David Stagg

Thanks very much. All in the same boat then. You have been v. helpful and now we know!!!

Mitzyboy

If you are a Spanish Tax resident then you will find that although your lump sum was tax free in the UK, it's won't be regarded in the same way in Spain. It will be regarded as income and therefore will be taxable.

Yes .... it is harsh ... but then if you've chosen to come and live in Spain, the best way is to take the lump sum before you move whilst you are still a UK tax payer.

Keithtoon

hola, calling Fred James..... Fingers crossed.

Mitzyboy

Mitzyboy got there before him

Keithtoon

Sorry Mitzy didnt see your post....but then do you have to declare it? I will pay my taxes on my income no probs doing that but pension pot seems a tad harsh.... Will buy property cash and pay taxes i have no problems doing that ...cheers keith

Mitzyboy

Well, no you wouldnt have to declare it, but if the tax authorities in Spain and the UK are talking to each other like it has been said that they are, then if you are found out I'm guessing you can expect some kind of fine / interest on top of the tax demand

I supposed it's a case of you DONT pay your money, you take your chances :-)
If it's a Government pension of course, then that isn't theoretically taxable at present (unless things have recently changed) in Spain, as Government pensions are taxed at source.

If you have both then presently you can declare on under your personal allowance in the UK, and your state pension under the Spanish allowance system in Spain. As said though, the lump sum is a problem :-)

shazzabob

my auntie lived ther but came home long away from main towns but a very nice place and very nice to look at but i really depend on what your ideas are and what you want peice and quite or the hustle abd bustle of town. go there to see first and have a look around spend a few days there.

lmj50

Gilly did you get my private message?

Rosemary

Gilly is unable to receive or send PM´s as she has insufficient posts.

Rosemary

lmj50

Ah damn ok thanks

Fred James

Lump sums taken when tax resident in Spain are liable to tax.

However, it is not as bad as it might appear at first as a considerable part of the lump sum can be tax free.

The calculation depends on each individual case, but the principle is fair.

The final value of your pension pot consists of money which you put in and the interest on that money over the life of the policy. You only pay tax on the percentage of the fund that is accounted for by the interest element, otherwise you would be paying tax on your own contributions.

Also, it is taxed at the savings rate rather than the income tax rate, which may be advantageous depending on the amounts involved.

Similarly, if you buy an annuity with the proceeds of the pension pot, you only pay tax on about a quarter of the income for the same reason.

Anyway, enough of taxes, can we please get back on topic and talk about Albox.

Keithtoon

Hola, thank you Fred, but i did get a tip on an earlier post
'take lump sum before you come to Spain'.
So big thank you to all! I will now think of something else to bore you all with lol........ Have a great weekend folks..... It is pretty chilly in hertford, Honest!