# CGT on sale of UK home



## StevanP (Sep 3, 2017)

Wanting to move to Spain from Uk and have been reading about CGT in Spain on sale of Uk property.
To complete the move I would need to sell my Uk property. With Brexit in mind and the need to obtain residence before 31st December 2020, does this mean that CGT will be charged in Spain on the sale of my Uk property and there is no way of delaying residence for tax purposes to avoid this ? Any advice would be appreciated as I may have misunderstood this


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## Pipeman (Apr 1, 2016)

Spend more than 90 days and less than 183 days in Spain this year and you can become resident without being fiscally tax resident for 2020. 

CGT for this year would not be charged and you'd not have to declare it for 2021.

I'm doing exactly this... I am currently selling my house and due to complete in April then a road trip around Europe for a couple of months and arrive in Spain on 6th July


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## StevanP (Sep 3, 2017)

Pipeman said:


> Spend more than 90 days and less than 183 days in Spain this year and you can become resident without being fiscally tax resident for 2020.
> 
> CGT for this year would not be charged and you'd not have to declare it for 2021.
> 
> I'm doing exactly this... I am currently selling my house and due to complete in April then a road trip around Europe for a couple of months and arrive in Spain on 6th July


That’s good to know. It’s just that something I read seemed to imply that I would be resident for tax purposes as soon as I apply for residence which would need to be in 2020 and this would apply to the whole of 2020. And therefore if I sold my Uk home in 2020 would be liable to Spanish CGT. Is this not correct ?


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## Pipeman (Apr 1, 2016)

Residency and tax (fiscal) residency are different beasts....

If you time it so you arrive with less than 183 days left in the year (I think I worked that as 3rd July, but I'm coming on the 6th July) then any implicit relationship by the Spanish authorities cannot be drawn.

I can see them taking an interest if you arrive in June and later decide to pop back to the UK for a few weeks at Christmas as absence of a temporary nature doesn't "stop the clock".


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## StevanP (Sep 3, 2017)

Thanks for the info, appreciated


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## xabiaxica (Jun 23, 2009)

Yes, residency & fiscal residency are two different things...

However, in order to maintain that residency you cannot be out of Spain for more than 6 months a year during the first 5 years.

Before Brexit, Brits could come & go at will, & no-one was any the wiser, so fiscal residency could be avoided in a way, even though the 6 months away rule was already in place.

However, once passports are checked every trip, it will be clear if someone is leaving for more than the permitted time, & the residency could be revoked.


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## baldilocks (Mar 7, 2010)

As soon as you move your 'home' here, you become fiscally resident.


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## Juan C (Sep 4, 2017)

baldilocks said:


> As soon as you move your 'home' here, you become fiscally resident.


Yes I agree 

That’s what Blevins Franks and a lot of other professionals say. 

The 183 days rule only applies if one does not move to Spain, or does not have their centre of financial activity in spain.


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## StevanP (Sep 3, 2017)

baldilocks said:


> As soon as you move your 'home' here, you become fiscally resident.


So this would imply that by selling in the U.K. now and moving to Spain before the end of this year I would be liable to CGT in Spain on the sale of the 
Uk home ? Seem to be getting conflicting messages


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## Juan C (Sep 4, 2017)

Stevan. I think whilst U.K. is still in the EU if you use the proceeds of the sale to buy a principle home in the EU within two years you avoid CGT.

To save me researching that maybe someone will confirm or otherwise


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## Barriej (Jul 23, 2012)

Juan C said:


> Stevan. I think whilst U.K. is still in the EU if you use the proceeds of the sale to buy a principle home inn the EU within two years you avoid CGT.
> 
> To save me researching that maybe someone will confirm or otherwise


You are correct. The financial advice given to us mentioned the same.
Although we don't have a property to sell so I didn't take much notice of that part off the conversation.

What I will say is, even though you may be moving after the 183 days, you will still have to provide financial information for the WHOLE of the year.

We will be moving in July and I retire at the end of May, but the Spanish accountant has said he will need all of my payslips from 2020 as well as the pension investment and details of any savings, loans, premium bonds etc. 
Even though I will have paid tax on the wages in the Uk any monies earned whilst in Spain during the remaining part of the year COULD be liable for Spanish tax. 

Because I knew of this I made my 25% pension transfer on the 31st Dec 2019 so it cannot be taken into the Spanish tax return that is due in 2021. So there will be no tax to pay.


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## StevanP (Sep 3, 2017)

My proposal is this : sell home in Uk for £310000 - repay mtge £110000= £200000 profit
Buy in Spain around £150000.

If anybody has any clue about what CGT liability I am likely to have, if any, I would be grateful. I guess I probably need to speak to a lawyer !


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## Barriej (Jul 23, 2012)

StevanP said:


> My proposal is this : sell home in Uk for £310000 - repay mtge £110000= £200000 profit
> Buy in Spain around £150000.
> 
> If anybody has any clue about what CGT liability I am likely to have, if any, I would be grateful. I guess I probably need to speak to a lawyer !


These people are one of the best to use. Ive only had a simple conversation with them and they said my affairs were not that complicated and a normal Spanish accountant would be adequate.

Blevins Franks.

Link below takes you to the CGT page. 

https://www.blevinsfranks.com/news/blevinsfranks/article/capital-gains-tax-spain


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## MataMata (Nov 30, 2008)

183 days is only one possible measure of fiscal residency, and not necessarily the primary one either.

Technically it's possible to be deemed tax resident without ever having set foot in the country!


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## baldilocks (Mar 7, 2010)

MataMata said:


> 183 days is only one possible measure of fiscal residency, and not necessarily the primary one either.
> 
> Technically it's possible to be deemed tax resident without ever having set foot in the country!


and because of the crazy UK tax year dates, you can be tax resident in both countries
.


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## 95995 (May 16, 2010)

StevanP said:


> My proposal is this : sell home in Uk for £310000 - repay mtge £110000= £200000 profit
> Buy in Spain around £150000.
> 
> If anybody has any clue about what CGT liability I am likely to have, if any, I would be grateful. I guess I probably need to speak to a lawyer !


But in that scenario surely the £200000 is just the amount you come away with after the sale and neither the profit nor the capital, unless you have never paid anything for your UK home nor had to maintain or renovate it


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## kaipa (Aug 3, 2013)

If you want to know the answer in uk you phone the taxman. Do same here ( or get Spanish speaker to do it). Coming on a forum will not give you a definitive answer. People do this because they tend to want to see an answer that supports their wishes. Bite the bullet and save yourself months of uncertainty.


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## 95995 (May 16, 2010)

kaipa said:


> If you want to know the answer in uk you phone the taxman. Do same here ( or get Spanish speaker to do it). Coming on a forum will not give you a definitive answer. People do this because they tend to want to see an answer that supports their wishes. Bite the bullet and save yourself months of uncertainty.


Probably still need to get your head around what constitutes capital gain though. Or include that in the question.


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## Juan C (Sep 4, 2017)

You may get a sensible response from HMRC, but having lived in spain for over 30 years and experienced the results of gestors calling their dedicated helpline with AEAT, and having a friend who is pretty senior in AEAT, I wish you luck with enquires there


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## Rich & Wendy (May 28, 2018)

StevanP - on the advice of posters on here, I spoke with a Blevis Frank's partner in Spain.
He told me categorically that moving over in the second half of this year and applying for residency will NOT attract CGT on the sale of UK home.
He was very specific about this.
I suggest you do the same, because no one on here seems to believe me, even though I was advised to speak with them by people on here.


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## xabiaxica (Jun 23, 2009)

Rich & Wendy said:


> StevanP - on the advice of posters on here, I spoke with a Blevis Frank's partner in Spain.
> He told me categorically that moving over in the second half of this year and applying for residency will NOT attract CGT on the sale of UK home.
> He was very specific about this.
> I suggest you do the same, because no one on here seems to believe me, even though I was advised to speak with them by people on here.


Most on here actually do agree with you...


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## StevanP (Sep 3, 2017)

Rich & Wendy said:


> StevanP - on the advice of posters on here, I spoke with a Blevis Frank's partner in Spain.
> He told me categorically that moving over in the second half of this year and applying for residency will NOT attract CGT on the sale of UK home.
> He was very specific about this.
> I suggest you do the same, because no one on here seems to believe me, even though I was advised to speak with them by people on here.


Thanks for this, I have called Blevins Franks in Spain and am waiting for them to get back to me. Thanks again


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## kaipa (Aug 3, 2013)

The only way to be sure is to phone the Spanish tax authority and get it from the horses mouth. Explain what you intend to do and they will advise you. It's free advice and will ultimately put an end to any doubts. But hey...no one wants to do this. I wonder why?


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