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Good Morning
My husband and I are looking to move to Southern Spain next year. I have been doing a lot of research and I am still confused about Spanish taxes.
We are retiring early (in our 50''s) and will be living off our savings and a small works pension. We will be mortgage free. Will we be required to pay tax?
Grateful for any advice or suggestions.
Thanks very much
Carol
We are British and have lived in Spain since December 2018 and just completed our first tax forms. You do them every year. We have not heard back yet about what we are due to pay so not sure how much it will be but we are in a similar position. Our company pensions are below the UK tax threshold but above the Spanish one which much lower. We also have the proceeds of our UK house sale in a UK bank. You had to declare all your assets outside Spain, income and Spanish assets.
Are you both British?
LINDYPOPS wrote on Sun May 31, 2020 9:25am:
We are British and have lived in Spain since December 2018 and just completed our first tax forms. You do them every year. We have not heard back yet about what we are due to pay so not sure how much it will be but we are in a similar position. Our company pensions are below the UK tax threshold ...
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...but above the Spanish one which much lower. We also have the proceeds of our UK house sale in a UK bank. You had to declare all your assets outside Spain, income and Spanish assets.
Are you both British?
Thanks for your response. Food for thought! Yes we are both British. We just want to understand everything before we commit. Thanks again!
Cal20 wrote on Fri May 29, 2020 9:26am:
Good Morning
My husband and I are looking to move to Southern Spain next year. I have been doing a lot of research and I am still confused about Spanish taxes.
Read more...
We are retiring early (in our 50''s) and will be living off our savings and a small works pension. We will be mortgage free. Will we be required to pay tax?
Grateful for any advice or suggestions.
Thanks very much
Carol
Good planning! You most definitely will probably pay the Hacienda (tax office) something. The personal allowance in the UK is really good but in Spain not so much. if you are over 65 (which you are not) then you get a better allowance. Yes you will need to submit a tax report each year (the year you start living there over 183 days) and you will need to hire an accountant to do it. My accountant does mine in about 24 hours so I don't need to wait and wonder. :) I always get the privilege of contributing. But then, I didnt pay into the Spanish system all my life so I don't mind so much. [Well I do but I accept that is life!]
Yes and you must report all assets over 50k euro in the Form 720 (that includes all the money you have in your UK bank accounts) and you must do that the first year you are a full time resident for tax purposes (over 183 days). You definitely need a good accountant in Spain which is probably completely foreign to most UK residents. Note: You do not pay tax on your assets unless they are over 700k euro.
From living, working and paying taxes in 3 countries I find there are pros and cons in each. In some countries you pay more on this or that and in others this and that. In Spain, living is not so expensive so it will probably weight out ok. Also, wine and beer is super cheap and they have alot of fiestas.
Welcome to Espana!
Kerri wrote on Mon Jun 1, 2020 5:04am:
Good planning! You most definitely will probably pay the Hacienda (tax office) something. The personal allowance in the UK is really good but in Spain not so much. if you are over 65 (which you are not) then you get a better allowance. Yes you will need to submit a tax rep...
Read more...
...ort each year (the year you start living there over 183 days) and you will need to hire an accountant to do it. My accountant does mine in about 24 hours so I don't need to wait and wonder. :) I always get the privilege of contributing. But then, I didnt pay into the Spanish system all my life so I don't mind so much. [Well I do but I accept that is life!]
Yes and you must report all assets over 50k euro in the Form 720 (that includes all the money you have in your UK bank accounts) and you must do that the first year you are a full time resident for tax purposes (over 183 days). You definitely need a good accountant in Spain which is probably completely foreign to most UK residents. Note: You do not pay tax on your assets unless they are over 700k euro.
From living, working and paying taxes in 3 countries I find there are pros and cons in each. In some countries you pay more on this or that and in others this and that. In Spain, living is not so expensive so it will probably weight out ok. Also, wine and beer is super cheap and they have alot of fiestas.
Welcome to Espana!
Thank you so much for your reply it is really helpful. Still a lot more to figure out before we make the final move!
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