Where Are You Better Off Being Tax Resident ? The UK Or Spain?

The Spanish tax system is very different from that in the UK and many other countries. Many people who have moved to Spain or are planning to do so inadvertently find it complex and

The Spanish tax system is very different from that in the UK and many other countries. Many people who have moved to Spain or are planning to do so inadvertently find it complex and potentially expensive from a tax perspective. In our experience, however, when you understand all the intricacies of the Spanish tax rules, it often makes more economic sense to be tax resident in Spain rather than in the UK.

Many people often do not realise just how much tax they could potentially save by taking advantage of Spanish tax compliant opportunities to protect their assets from the various Spanish taxes.

With the right advice it is often possible to significantly lower income and capital gains tax on your savings and investments. It may also be possible to reduce your wealth tax liability if your taxable wealth is above the threshold.

British expatriates who have retired in Spain may also have the opportunity to move their UK private pensions into QROPS (Qualifying Recognised Overseas Pension Schemes) and considerably improve their tax position.

When it comes to inheritance taxes, in some situations your heirs would pay less tax if you are resident in Spain rather than the UK, but this depends on many factors including the number of beneficiaries. Spanish assets are always liable to Spanish succession tax, but in many Spanish regions the tax could be reduced to virtually nil for your spouse and children if you are habitually resident in that region.

Just how much tax you would save as a Spanish resident depends on your assets and income, but it is certainly worth investigating. We would be happy to give you personalised advice and guide you through the most effective solutions.

The tax rates, scope and reliefs may change. Any statements concerning taxation are based upon our understanding of current taxation laws and practices which are subject to change. Tax information has been summarised; an individual must take personalised advice.