# Taxes in Spain



## mr_madonna007 (Sep 17, 2012)

Hello again

I made a post earlier today about taxes on UK savings.

Please don't explain about pensions - this is not what I'm asking about - this will be about saving only.

The scenario is this:

Say for example I have 100k.

I will transfer 40k to Spain, and keep 60k in the UK.

Now, with the new tax rates which are taking place in Spain, I know I have to declare this 60k in the UK.

The 40k I have transferred to Spain should last around 4 years living on 8 - 9K a year, as I'll have no mortgage, and will be easier to manage.

As this will be my only income - from my savings - nothing else, will I still have to declare a tax return form and pay tax?

AND when I get taxed on my Spanish bank account, will the new rate of tax be deducted from the interest I receive from my Spanish bank and NOT from my saving?

Just like in the UK - you only get taxed on the interest you get on your savings.

Is this the same in Spain?

It's hard to read that anything from 0 - 17,700 will be taxed at 24.75%.

It's very confusing. I've been reading all sorts of "Tax Laws on Savings" in Spain, but it's not very clear.

No one seems to be able to explain if it's only the interest you'll be taxed on - not your actual money. :faint::faint::faint:

I hope this all makes sense. Reading so much on "taxes" can drive you round the bend!! :blah::blah::blah::blah::blah:


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## snikpoh (Nov 19, 2007)

Yes, you only get taxed on the interest - but, first off, show me a bank that offers interest!

Don't forget the allowances before you need to pay tax.


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## CapnBilly (Jun 7, 2011)

You will pay tax on any interest you earn on your savings (both here and in the UK). Tax on interest, is as I posted earlier 21% upto €6000 and over that upto €24,000 at 25%. You will be able to offset your personal allowance of €5151 (if you are married there is an additional allowance, or you could be taxed seperatly if this is beneficial). Any interest you earn in a resident account in Spain will have the tax deducted automatically.

In the Uk, as I posted earlier you can have the interest paid gross using an R105, but if the organisations you deal with don't provide this facility, then they will deduct tax, and you will only be able to claim back over 12% from HMRC

Any tax you do pay in the UK will be deductable from the tax due in Spain under the double taxation agreement, but only upto the amount of tax due on your UK interest (see below)

You will have to submit a tax return if you earn over €1,600 interest , or you have a double taxation claim. Depending upon the interest you earn. you may get a refund of the tax deducted in Spain, BUT although you can claim DTA for tax on interest paid in the UK, you will not get a refund if you have overpaid.


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## mr_madonna007 (Sep 17, 2012)

CapnBilly said:


> You will pay tax on any interest you earn on your savings (both here and in the UK). Tax on interest, is as I posted earlier 21% upto €6000 and over that upto €24,000 at 25%. You will be able to offset your personal allowance of €5151 (if you are married there is an additional allowance, or you could be taxed seperatly if this is beneficial). Any interest you earn in a resident account in Spain will have the tax deducted automatically.
> 
> In the Uk, as I posted earlier you can have the interest paid gross using an R105, but if the organisations you deal with don't provide this facility, then they will deduct tax, and you will only be able to claim back over 12% from HMRC
> 
> ...


Finally - it now makes sense :clap2::clap2::clap2::clap2:

Thank you both for this information. I know I made an earlier post about UK savings, but it got confusing when everyone started talking about pensions - I lost track of it all.

I'm so glad it's the interest that will be taxed at the new rate - this is not explained on the information I read on company websites - probably a way of employing these people to do your taxes for you 

And it doesn't explain about your personal allowance which was even more confusing 

Trying to find simple information on tax seems difficult. I did find tax bands on saving amounts, but doesn't explain how it works in general i.e breakdown of how your saving will be taxed, personal allowances and so on.

Hopefully I will have all this sussed when I move there next year!


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