# Urgent advice needed pls



## Teetta (May 8, 2021)

Hello everyone,

I'm new to the group but have been following numerous posts on tax residency in Spain for over a year now.

I urgently need some advice and would really appreciate any input from people who have been in a similar situation or who are knowledgeable in the matter.

A little background information: I'm a British citizen, while my husband and 5 year old son have dual citizenship (British & Italian). I have my Italian citizenship ceremony at the end of this month, but won't have an EU passport yet.

We have been planning our move to Spain since last year, finally sold our house in the UK this March 2021 and are currently renting until we can relocate. We have all our things in storage just waiting as restrictions have made it impossible to travel this year. We also own a property in Spain, so won't need to look for a place to stay there.

My questions are;
1. Since we sold our property in March 2021, will we be liable for CGT in Spain of we moved in June or better to move in July 2021?

2. When do I become tax resident in Spain? Am I considered tax resident from the first day I step in the country since we are travelling for relocation not holiday?

3. I currently work through my UK ltd company but will be registering as autonomo when I get to Spain. Do I need a visa to register as autonomo since I'm not an EU citizen? Can I keep using my UK Ltd company in Spain until I become autonomo?

4. Do you need to have residencia before becoming autonomo? I will need to set up myself as quickly as possible to carry on working remotely as that will be our only source of income

Sorry for the long post and many questions but I really need urgent advice and appreciate any inputs.

Thank you.


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## Megsmum (Sep 9, 2012)

Teetta said:


> Hello everyone,
> 
> I'm new to the group but have been following numerous posts on tax residency in Spain for over a year now.
> 
> ...


I've answered what I can above. Please note these are my experiences


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## Teetta (May 8, 2021)

Megsmum said:


> I've answered what I can above. Please note these are my experiences


Thanks for your prompt response Megsmum! I recognise your name from another post 😊

Yes, we will be moving as Italian citizens but since I won't have an EU passport yet, I'm not sure how this will affect my ability to continue working remotely before applying for residencia.


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## Rich & Wendy (May 28, 2018)

Delay your your move until July, then you will not be liable for CGT on your UK house sale.
You will become tax resident in Spain January 2022, and will first pay tax June 2023.
We moved over late last year acting on accountants advice, so we will first pay tax June 2022.


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## kalohi (May 6, 2012)

First of all, understand that you should always take professional advice when it comes to taxation. But here's a little guidance.

The webpage of the Agencia Tributaria (Spanish income tax agency) says the following:

_An individual is resident in Spanish territory when any one of the following circumstances apply:_

_They have stayed longer than 183 days in Spanish territory over the calendar year.In order to determine the permanence in Spanish territory, occasional absences are included, except if the taxpayer accredits their residency in another country.In the case of countries or territories labelled as tax havens, the Tax Administration can demand proof of stay in that tax haven over a period of 183 days within the calendar year._
_They situate the main base or centre of their activities or economic activities, directly or indirectly, in Spain._
_They have dependent not legally separated spouse and/or underage children who are usually resident in Spain.This latter situation accepts evidence to the contrary._
So if you moved to Spain in July you wouldn't meet the first condition, but you might meet the second or third condition. Once you become tax resident, you are tax resident for the entire year. 

You won't need a visa if you move here as the spouse of an EU citizen. First your husband (as the EU citizen) will need to register with the foreigner's office as an EU resident in Spain. To do so he will have to show that he has sufficient income and/or savings and also health insurance. Then you can apply for an EU family member card (TIE). That process can take months, and you won't be able to register as autonomo until the process finishes. 

It seems to me the easier route would be for you to get your Italian passport. Then both of you could become resident and you could become autonomo almost immediately.


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## MataMata (Nov 30, 2008)

I concur with the above.

I was in fact in the middle of composing a reply to the same effect when it was posted.


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## Teetta (May 8, 2021)

Rich & Wendy said:


> Delay your your move until July, then you will not be liable for CGT on your UK house sale.
> You will become tax resident in Spain January 2022, and will first pay tax June 2023.
> We moved over late last year acting on accountants advice, so we will first pay tax June 2022.


Thanks Richard & Wendy. I think I now understand how timing our move will work. It will have to be in July or later.


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## kaipa (Aug 3, 2013)

If you move to Spain this year then you would be liable for CGT tax as soon as you registered as resident. The only possible way would be to try and be here less than the 183 day rule in otherwords late July but I wouldn't risk it. To be safe you should wait until this tax year has passed. That means registering the beginning of January. You could still be in Spain for 90 days before that but you wouldn't be able to register as autonomo. I suppose it depends how big your CGT will be in Spain.


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## Teetta (May 8, 2021)

kalohi said:


> First of all, understand that you should always take professional advice when it comes to taxation. But here's a little guidance.
> 
> The webpage of the Agencia Tributaria (Spanish income tax agency) says the following:
> 
> ...


Thanks Kalohi. I understand the part about getting professional advice on tax issues and I have, but after receiving so many conflicting information I got more confused.

Your response is very informative. If I understand correctly, even if we move after June and my EU spouse registers with the foreigner's office and the padron, then I could be considered tax resident for 2021 in Spain?

Yes, it would be easier if I had my Italian passport but it takes months if not years to get one. It has taken over 4 years to get the citizenship. So, that option will be very difficult.

This is a bit tricky because the removal company needs the padron to move our things over. At least that's what they said. And I can't afford not to keep working as that's our only source of income, so was hoping to register as autonomo quickly.

Guess, I have a lot more planning to do.


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## kaipa (Aug 3, 2013)

I know that before Brexit you could set up as autonomo without actual residency but I imagine you cant now as you would need a Visa if you were a UK national. That said as the wife of an EU husband you should be able to get residency without the requirements of a Visa. In other words I think you will need to be resident first and if you become a resident you will be taxed for 2021. The only way to be 100 % sure you will not be taxed is to not register until Jan 2020. It's TRUE that you should seek advice but as many have already posted the basic rules are fairly clear and your lawyer is not the one who is fined and has to pay!


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## NickZ (Jun 26, 2009)

Remember you're an UK tax resident until you're not. Wander over the UK website on tax residency.






Tax on foreign income


Find out whether you need to pay UK tax on foreign income - residence and ‘non-dom’ status, tax returns, claiming relief if you’re taxed twice (including certificates of residence)




www.gov.uk





Spain can have it's own rules but if they conflict with the UK you need to go by the tax treaty. Which will tell you capital gains on property are first taxed in the country the real estate is in. It'll also help you figure out if you're a Spanish or UK resident.


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## Teetta (May 8, 2021)

NickZ said:


> Remember you're an UK tax resident until you're not. Wander over the UK website on tax residency.
> 
> 
> 
> ...


Thanks NickZ. Yes, I'm a UK tax resident but was exempt from CGT on the sale of the property as that's our primary residence.


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## Teetta (May 8, 2021)

kaipa said:


> If you move to Spain this year then you would be liable for CGT tax as soon as you registered as resident. The only possible way would be to try and be here less than the 183 day rule in otherwords late July but I wouldn't risk it. To be safe you should wait until this tax year has passed. That means registering the beginning of January. You could still be in Spain for 90 days before that but you wouldn't be able to register as autonomo. I suppose it depends how big your CGT will be in Spain.


Thanks Kaipa. Yes, we could come over for 90 days but wait to register as residents. The CGT in Spain will be enough to cover our bills for about a year, hence my reluctance to part with it if possible.


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## Teetta (May 8, 2021)

kaipa said:


> I know that before Brexit you could set up as autonomo without actual residency but I imagine you cant now as you would need a Visa if you were a UK national. That said as the wife of an EU husband you should be able to get residency without the requirements of a Visa. In other words I think you will need to be resident first and if you become a resident you will be taxed for 2021. The only way to be 100 % sure you will not be taxed is to not register until Jan 2020. It's TRUE that you should seek advice but as many have already posted the basic rules are fairly clear and your lawyer is not the one who is fined and has to pay!


I get it now. I can only register for autonomo after getting residency, which makes sense. To avoid CGT in Spain, I will have to push my residency until January 2022. Therefore, I can't set up as autonomo until 2022. This is going to be tricky.


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## Teetta (May 8, 2021)

I read somewhere that if the proceeds from the sale of the UK property is used for the purchase of the new property in Spain, then one could avoid paying the CGT in Spain?
I'm not sure how this will apply to my situation as we had some delays in the sale of our UK home and sold in March 2021 but bought the property in Spain December 2020.

The money from the sale of our UK home was used for the property in Spain as we had to take a loan and pay back after selling. I know this is a bit confusing but would appreciate if anyone knows more about this.

Thanks 😊


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## MataMata (Nov 30, 2008)

Liability for CGT in UK and Spain are not the same thing and I believe the rule here is that to escape it you must invest the _whole_ of the sale price of a property into a Spanish one. If you didn't do that then that's a bell which can't be unring.


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## Teetta (May 8, 2021)

MataMata said:


> Liability for CGT in UK and Spain are not the same thing and I believe the rule here is that to escape it you must invest the _whole_ of the sale price of a property into a Spanish one. If you didn't do that then that's a bell which can't be unring.


Thanks MataMata. I understand that the liability is different in both countries but it will be impossible to invest the _whole _the sale price as there are mortgage repayments to make from the sale.


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## kaipa (Aug 3, 2013)

The roll over in properties ( I think) to avoid CGT was only available to EU member states so dont think that will apply. The problem is that Spain is nothing like as generous as UK on many tax issues and moving from one tax system to another can often be punitive unless you have made careful planning. In the past many people could get away with transactions in the UK without Spain really being able to do alot. One of the big changes is that banks can be obliged to provide information to various overseas tax departments. When you leave the UK your bank will require you to provide a change of residency address. Many expats keep their accounts by using UK addresses but I was caught out by this last year when my bank questioned my residency as it had my Spanish telephone number. So while you wo t be chased by the UK if you sell your house any large deposits in your account could mean your bank providing that information with Spain.


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## Teetta (May 8, 2021)

kaipa said:


> The roll over in properties ( I think) to avoid CGT was only available to EU member states so dont think that will apply. The problem is that Spain is nothing like as generous as UK on many tax issues and moving from one tax system to another can often be punitive unless you have made careful planning. In the past many people could get away with transactions in the UK without Spain really being able to do alot. One of the big changes is that banks can be obliged to provide information to various overseas tax departments. When you leave the UK your bank will require you to provide a change of residency address. Many expats keep their accounts by using UK addresses but I was caught out by this last year when my bank questioned my residency as it had my Spanish telephone number. So while you wo t be chased by the UK if you sell your house any large deposits in your account could mean your bank providing that information with Spain.


Hmmm.... looks like I will have to just bite the 'CGT' bullet and plan my move with that in mind. I know what you mean, I received a letter from my bank last year asking to confirm tax residency which I found odd as I'm only tax resident in the UK. Maybe it's because I have a Spanish bank account. I will be changing my address on my UK bank accounts when I become resident in Spain, hopefully I won't have to close them.


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## Sicilianuk (May 7, 2021)

Hi everyone
Apologies for barging into this post, but need some advice please.
My situation is similar to Teetta's.
I am Italian and currently live in the UK
I am planning to move to Spain in about 2 months time
I currently have 2 properties, 1 is a BTL house and the other is my residential home.
I am in the process of selling the BTL and changing my residential into a BTL.
I will have sold the BTL by the end of May and the tenants will then move into my residential that I am currently changing into a BTL mortgage.
Upon the sale of my BTL I will be liable to pay CGT in the UK.
Approximately a month later (early July) I will be moving to Spain where I will use the BTL net income to live on.
As I am already paying cgt in the UK and will have sold the house before I move to Spain and before I gain Spanish residency, I take it that no CGT will be due in Spain as I will have sold it prior to becoming a Spanish resident?

Also, Rich & Wendy, you mention having used and accountant, would you mind telling me who they are, as I can def use some advice as it's proving daunting to make this move. 
Any other advice or help/pointers would be greatly appreciated. 

Thanks in advance.


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## Teetta (May 8, 2021)

Sicilianuk said:


> Hi everyone
> Apologies for barging into this post, but need some advice please.
> My situation is similar to Teetta's.
> I am Italian and currently live in the UK
> ...


Hello Sicilianuk,

I spoke with a Spanish tax expert yesterday regarding how best to organise my tax affairs and she confirmed what everyone else has said regarding the CGT.
She stated that if I move the same year the property was sold, I would be charged CGT in Spain. The only way to avoid this is to move in January 2022. I will have to work out a different move date, unfortunately.

Maybe someone else has more to add regarding your particular situation but that's what I've been told.


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## kaipa (Aug 3, 2013)

Teetta said:


> Hello Sicilianuk,
> 
> I spoke with a Spanish tax expert yesterday regarding how best to organise my tax affairs and she confirmed what everyone else has said regarding the CGT.
> She stated that if I move the same year the property was sold, I would be charged CGT in Spain. The only way to avoid this is to move in January 2022. I will have to work out a different move date, unfortunately.
> ...


I think that is the correct advice. You will get people saying that if you are in Spain for less than 183 days then you are not liable for tax so you can come late July etc but this will always be trumped by any evidence that you had effectively moved to Spain to live permanently ie. Signing on padron, applying for residencia etc. Remember your legal representative will always get you to sign a form saying any pursuant monies will be paid by you so it really isnt going to effect them.


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## Sicilianuk (May 7, 2021)

Wow... that's shocking...
And to think we are going to inject cash into the Spanish system, where tax has been paid in the UK, thus benefitting the Spanish economy and depriving the UK one of disposable cash . You'd think that they would be grateful of any monies coming in, as long as the cash provenance can be proved. 
Thanks both for the information def invaluable. 
Teetta, if you don't mind me asking, are you aware of the customs duties payable for your personal belongings?


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## Teetta (May 8, 2021)

Sicilianuk said:


> Wow... that's shocking...
> And to think we are going to inject cash into the Spanish system, where tax has been paid in the UK, thus benefitting the Spanish economy and depriving the UK one of disposable cash . You'd think that they would be grateful of any monies coming in, as long as the cash provenance can be proved.
> Thanks both for the information def invaluable.
> Teetta, if you don't mind me asking, are you aware of the customs duties payable for your personal belongings?


Yes, doesn't seem fair and I can't justify donating that amount of money to the taxman in Spain. That's why we are thinking of pushing our dates.

The removal company asked us to provide evidence of leaving the uk to permanently reside in Spain. This has to be provided by our local council that we pay council tax to.
Without this we will have to pay import tax and vat on our personal goods in order to clear customs.


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## kaipa (Aug 3, 2013)

Unfortunately one big problem is moving from one tax system to another. Spain is quite different from UK. It can be a shock for many people. As we now need to visas for moving this means more people will be subject to taxes. I was shocked to find that when divorcing in Spain tax is often paid!. Spouses can not move assets to each other so any disparity between is taxable. Inheritance tax can also mean there is double taxation in Spain. Ì


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## MataMata (Nov 30, 2008)

Yep, their country their rules I'm afraid.

The choice to come or not is yours to make.


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## kaipa (Aug 3, 2013)

Spain is fine for retired folk who have often stabilised their finances and liquidated assets. They are basically at a point in life when they are more inclined to spend than save. Younger folk ,especially with families , have to plan for longer futures so the emphasis is on saving. Problem is that for decades Spain has regarded tax as an inconvenience and therefore their attitude was often one of avoidance which was almost tacitly accepted by everyone. Now that Spain is being forced to adapt to a more rigorous system things are changing. The problem is for young people in the UK you plan your futures on the basis of uk tax. There are protected investment packages which are tax free. CGT on primary properties does not exist. Personal allowances etc
Generous inheritance tax ( disposable of assets prior to death) . In Spain these dont exist or ,if they do , they are at much reduced level. In the past most expats kept their UK affairs separate from their Spanish ones but that has changed. My advice is if you are young and have already begun planning your UK finances it is vitally important you get advice about what might occur if you move to Spain.


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## Teetta (May 8, 2021)

kaipa said:


> Spain is fine for retired folk who have often stabilised their finances and liquidated assets. They are basically at a point in life when they are more inclined to spend than save. Younger folk ,especially with families , have to plan for longer futures so the emphasis is on saving. Problem is that for decades Spain has regarded tax as an inconvenience and therefore their attitude was often one of avoidance which was almost tacitly accepted by everyone. Now that Spain is being forced to adapt to a more rigorous system things are changing. The problem is for young people in the UK you plan your futures on the basis of uk tax. There are protected investment packages which are tax free. CGT on primary properties does not exist. Personal allowances etc
> Generous inheritance tax ( disposable of assets prior to death) . In Spain these dont exist or ,if they do , they are at much reduced level. In the past most expats kept their UK affairs separate from their Spanish ones but that has changed. My advice is if you are young and have already begun planning your UK finances it is vitally important you get advice about what might occur if you move to Spain.


This is very true, thanks kaipa.


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## kaipa (Aug 3, 2013)

I think it is very important to untangle yourself from the opinion of those who are retired in Spain whose requirements are very different from yours. For example, I located to Spain with a young family 6 years ago. I was already fairly knowledgeable about Spain and could speak some Spanish etc. Now my child is 15 and I can see that the education route offered to him here in Spain is simply not flexible enough to equip him for the future. 4 hours a week are used for Valenciano and Biology has only 1!. His UK friends are ahead of him with Maths, chemistry etc. My son does well here in Spain and is fluent for his age group in Spanish. However, the schools struggle to deliver the syllabus as so many pupils in the class are foreigners who have no Spanish and have been brought here by parents pursuing dreams that are more weather shaped than work shaped. These kids are not at all motivated ( through no fault of their own) and basically unable to be taught. The result is son is suffering education wise and needs to return to UK to complete his secondary education. If he was older and perhaps at university I would remain here in Spain unfortunately I have little choice but to up sticks ( again)


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## Teetta (May 8, 2021)

kaipa said:


> I think it is very important to untangle yourself from the opinion of those who are retired in Spain whose requirements are very different from yours. For example, I located to Spain with a young family 6 years ago. I was already fairly knowledgeable about Spain and could speak some Spanish etc. Now my child is 15 and I can see that the education route offered to him here in Spain is simply not flexible enough to equip him for the future. 4 hours a week are used for Valenciano and Biology has only 1!. His UK friends are ahead of him with Maths, chemistry etc. My son does well here in Spain and is fluent for his age group in Spanish. However, the schools struggle to deliver the syllabus as so many pupils in the class are foreigners who have no Spanish and have been brought here by parents pursuing dreams that are more weather shaped than work shaped. These kids are not at all motivated ( through no fault of their own) and basically unable to be taught. The result is son is suffering education wise and needs to return to UK to complete his secondary education. If he was older and perhaps at university I would remain here in Spain unfortunately I have little choice but to up sticks ( again)


I can see how this could be a problem. 4 hours of language lessons vs 1 hour of core subjects like Biology doesn't seem balanced.
My son will be 6 in July and I feel bad making him go back a year in school due to our move but I figured it's better to do it now rather than later.


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## kaipa (Aug 3, 2013)

If you and partner are UK nationals and grew up with UK educational system and you have no cultural ties to Spain I very much think that you will at some point be thinking of giving your child a UK system. I know I am being quite judgemental but everyone I know who had no Spanish ties and had lived a long time in UK takes kids back or puts them in English schools in Spain ( at least in Secondary)
Some expats who might have left UK when young adults and worked abroad before having families are usually better suited to keeping the kids in adopted country's educational system and have no problem with it but they tend to be real expats who have cut UK ties almost completely.


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## xabiaxica (Jun 23, 2009)

Teetta said:


> I can see how this could be a problem. 4 hours of language lessons vs 1 hour of core subjects like Biology doesn't seem balanced.
> My son will be 6 in July and I feel bad making him go back a year in school due to our move but I figured it's better to do it now rather than later.


Valenciano is the local language, so is arguably more 'core' than other subjects. It's the language of the home for the locals, & also of all local goverment bodies, hospitals etc. That doesn't mean that castellano isn't spoken, but anyone growing up in this area needs valenciano if they wish to intregate with the locals.

Both my kids went through the Spanish educational system from age 4 & 7, studying in both castellano & valenciano - at the time about half of subjects in primary school were delivered in each language.

Once they moved to secondary school, the elder one opted to go through the valenciano line, & the younger through the castellano. In practice it made little difference & both consider castellano to be their 'first' language (before English). The elder speaks better valenciano than the younger, but the younger also has a high level. It's just an extra language to them, now at the age of 21 & 25.


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## kaipa (Aug 3, 2013)

If it was a case of my son being born here etc and starting primary etc then maybe the valenciano wouldn't be a big problem. Where I am though no one uses it and it is seen only as a tool for funcinario positions. What most need though is English one because of tourism and secondly it's a global business language so provides opportunities for more creative innovative careers.
As of next year it is compulsory even at bacherlerato level and given that you need to pass everything its obviously pointless my son enrolling in Bachelerato as he would never obtain the level having been opted out of Valenciano for this year.


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## xabiaxica (Jun 23, 2009)

kaipa said:


> If it was a case of my son being born here etc and starting primary etc then maybe the valenciano wouldn't be a big problem. Where I am though no one uses it and it is seen only as a tool for funcinario positions. What most need though is English one because of tourism and secondly it's a global business language so provides opportunities for more creative innovative careers.
> As of next year it is compulsory even at bacherlerato level and given that you need to pass everything its obviously pointless my son enrolling in Bachelerato as he would never obtain the level having been opted out of Valenciano for this year.


Every local person I know here uses it on a daily basis!


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## kaipa (Aug 3, 2013)

I live in torrevieja. It is never used here as we are actually near mucia


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## Teetta (May 8, 2021)

kaipa said:


> If you and partner are UK nationals and grew up with UK educational system and you have no cultural ties to Spain I very much think that you will at some point be thinking of giving your child a UK system. I know I am being quite judgemental but everyone I know who had no Spanish ties and had lived a long time in UK takes kids back or puts them in English schools in Spain ( at least in Secondary)
> Some expats who might have left UK when young adults and worked abroad before having families are usually better suited to keeping the kids in adopted country's educational system and have no problem with it but they tend to be real expats who have cut UK ties almost completely.


My partner and I are UK nationals but moved here as adults, so had most of our education elsewhere.
We do not have Spanish ties and would relocate elsewhere if we find the system not too favourable for us. But we are hoping since he's still little, he will be able to settle in the public school system and he already started having Spanish lessons. What will happen at Secondary level is another topic.


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## Teetta (May 8, 2021)

xabiaxica said:


> Valenciano is the local language, so is arguably more 'core' than other subjects. It's the language of the home for the locals, & also of all local goverment bodies, hospitals etc. That doesn't mean that castellano isn't spoken, but anyone growing up in this area needs valenciano if they wish to intregate with the locals.
> 
> Both my kids went through the Spanish educational system from age 4 & 7, studying in both castellano & valenciano - at the time about half of subjects in primary school were delivered in each language.
> 
> Once they moved to secondary school, the elder one opted to go through the valenciano line, & the younger through the castellano. In practice it made little difference & both consider castellano to be their 'first' language (before English). The elder speaks better valenciano than the younger, but the younger also has a high level. It's just an extra language to them, now at the age of 21 & 25.


I believe learning multiple languages is a very important skill to have in life, especially the language of the place you live.
But I think core subjects are Language (Valenciano or whichever applies to a region), Maths and Sciences.
I wouldn't be too happy if I spent 4 hours on English vs 1 hour on Sciences per week in Secondary school. I don't think it's balanced enough to prepare me to 'compete' on a global scale with my peers from other countries. Just my opinion though.


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## kaipa (Aug 3, 2013)

Unfortunately Spain is quite divided within itself with different regions being super protective of their particular regional identity. It is a bit like being in a country of countries at times. At the moment in Valencia Ximo Puig is the ruling head and very much in favour of strengthening the idea of regional identity hence the obligation to do Valenciano through the whole primary and secondary curriculum. Before you could choose to opt out which seemed much more in line with a modern democratic approach. However with political tensions running high in Spain everyone is staking out their claims. In otherwords, like Brexit this is an example of political groups fighting amongst themselves whilst allowing the outcomes to affect everyday peoples lives. Spain desperately needs to up its game when it comes to education and equipping its young. It has the highest level of youth unemployment in Europe but still seems to churning out large amounts of of graduates without global competitiveness


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