# UK/Spanish tax liablities



## davethed (Mar 3, 2008)

My wife and I are planning to retire in Spain in the near future and I am trying to gather as much information as possible regarding forthcoming UK/Spanish tax liablities before we go as I don’t want any nasty surprises when we get there.

We intend to take up residence in Spain and to initially rent a property while we are looking for a suitable location to purchase a property.

We plan to invested £190,000 in UK Income Bonds, the interest from this would be paid gross and would give us a monthly income of £800.00 this will be transferred to our Spanish bank account through a foreign currency exchange company to meet our monthly outgoing payments.

I presume that the interest from the UK Income Bonds will form part of our income and be subject to Spanish income tax but what I'm sure of, is the £190,000 invested subject to Spanish Wealth tax, any help please?

Also, a large part of our income will be paying rent on a property, is this subject to income tax relief?

Kind regards

Dave


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## Stravinsky (Aug 12, 2007)

davethed said:


> My wife and I are planning to retire in Spain in the near future and I am trying to gather as much information as possible regarding forthcoming UK/Spanish tax liablities before we go as I don’t want any nasty surprises when we get there.
> 
> We intend to take up residence in Spain and to initially rent a property while we are looking for a suitable location to purchase a property.
> 
> ...


As a joint income, on £800 a month you shouldn't have to pay any income tax here in Spain as it falls under the allowance which is roughly €13k.

Yes, the amount will be subject to wealth tax, but if that is the extent of your wealth then you will come under the wealth tax allowance figure and not pay anything. 

I dont think your rent is deductable, but a mortgage will as its a loan.


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## Stravinsky (Aug 12, 2007)

Stravinsky said:


> As a joint income, on £800 a month you shouldn't have to pay any income tax here in Spain as it falls under the allowance which is roughly €13k.
> 
> Yes, the amount will be subject to wealth tax, but if that is the extent of your wealth then you will come under the wealth tax allowance figure and not pay anything.
> 
> I dont think your rent is deductable, but a mortgage will as its a loan.



The allowance are about €108,000 for wealth tax and there is an additional €150k towards your main residence also ... thats each


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