# MERGED....Declaration of Overseas assets to Spanish Tax Authority



## GallineraGirl

Hi, We're just getting together the information about our assets abroad for the new tax law. Does anyone know if there is an official exchange rate published by the Spanish Tax Office, pounds to euros, for the last tax year? Thanks.


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## snikpoh

GallineraGirl said:


> Hi, We're just getting together the information about our assets abroad for the new tax law. Does anyone know if there is an official exchange rate published by the Spanish Tax Office, pounds to euros, for the last tax year? Thanks.


You have to use the rate as of 31/12/12 - pound to euro 'mid-rate' was 1.2332


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## CapnBilly

snikpoh said:


> You have to use the rate as of 31/12/12 - pound to euro 'mid-rate' was 1.2332


That's as good a rate as any, but you get different rates depending upon where you look. For all my official calculations I always use the ECB official daily rate, so nobody can argue with it. You can download historical rates from 1999 onwards from here

http://www.ecb.int/stats/exchange/eurofxref/html/index.en.html


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## ezza

Also how is the value of property overseas calculated?


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## CapnBilly

ezza said:


> Also how is the value of property overseas calculated?


My understanding is that the value is based on the acquisition value converted at the exchange rate on the 31st December

_If a person / company owns / beneficial owner of a property abroad whose purchase price consists in a currency other than the euro and is required to file information return, what is the exchange rate that should be used to determine the value acquisition?
In the case of buildings, the purchase value, as in the other property and rights subject to declaration, must conform to the prevailing exchange rate on the date December 31 of the year to which the information declared._


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## GallineraGirl

snikpoh said:


> You have to use the rate as of 31/12/12 - pound to euro 'mid-rate' was 1.2332


Thank you for some useful replies in this thread. Another question: Do you have to use the exchange rate at the end of the year when you do your normal tax return or do you use an average rate for the year, or even use the rate you got yourself when bringing money into the country e.g. when converting a pension in pounds to euros monthly?


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## snikpoh

GallineraGirl said:


> Thank you for some useful replies in this thread. Another question: Do you have to use the exchange rate at the end of the year when you do your normal tax return or do you use an average rate for the year, or even use the rate you got yourself when bringing money into the country e.g. when converting a pension in pounds to euros monthly?


As a resident, when I do my tax return, all they need are the average balance and final balance in my Spanish accounts. These are provided by the banks. Consequently, there is no need to worry what exchange rate I got when the money was transferred. The interest that I get on any accounts I hold in UK is so small that my accountant has, in the past, told me that she will ignore them.

The only time I can see that being an issue, is if you hold a sterling account in Spain - how does that get reported for tax purposes?


I guess the problem now is that if one declares all assets in UK, then ANY interest earned on those accounts has to be declared now. As the UK issue tax reports in April, how can one use these to prove how much interest was earned in a calendar year - all very messy!


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## CapnBilly

snikpoh said:


> As a resident, when I do my tax return, all they need are the average balance and final balance in my Spanish accounts. These are provided by the banks. Consequently, there is no need to worry what exchange rate I got when the money was transferred. The interest that I get on any accounts I hold in UK is so small that my accountant has, in the past, told me that she will ignore them.


Don't quite understand this, as the final balance in your account is irrelevant with regard to your income. 




GallineraGirl said:


> Thank you for some useful replies in this thread. Another question: Do you have to use the exchange rate at the end of the year when you do your normal tax return or do you use an average rate for the year, or even use the rate you got yourself when bringing money into the country e.g. when converting a pension in pounds to euros monthly?


You can use an average rate, and I think Hacienda do publish one, but I have yet to find it on their website. You can always calculate your own, by adding up the rate for every day of the year and dividing by 365.

If you receive a sterling income that is converted and paid to you I.e a state pension, then I would use the rate that you received. If, like me you receive a sterling income, but manage your own exchange rate conversions, then I use the exchange rate on the day it is paid ( this is what I meant by official calculations earlier, so I use the ECB rate I linked to). I apply the same principal to interest received.

To a certain extent it doesn't matter what rate you use, and you just report an amount. However, if you get asked to provide justification, then you don't want to get into an argument with them, and this is why I use the ECB rate, as its an officially published rate. Whatever system you use, you need to keep a record that you can refer to. Having just been asked to provide some evidence to support an item on my last return, I know that you only get 10 working days to comply. In addition, any evidence you provide has to be officially translated into Castilian if its in another language.



snikpoh said:


> The only time I can see that being an issue, is if you hold a sterling account in Spain - how does that get reported for tax purposes?


Well, if its income then you need to convert it, using a method above. If its a year end balance under modelo 720, then you use the rate on the 31st December.



snikpoh said:


> I guess the problem now is that if one declares all assets in UK, then ANY interest earned on those accounts has to be declared now. As the UK issue tax reports in April, how can one use these to prove how much interest was earned in a calendar year - all very messy!


I know you know this, but interest earned in the UK has always had to be declared, it's just that they know you have an interest bearing asset if you report. With regard to the interest earned, it's not based on a calendar year, it's on the day of receipt, so the difference in tax years is irrelevant. So for example, if you were a non resident in 2011, and returned to Spain on the 1st January 2012, and on the 2nd received interest of £5,000 ( I wish) in respect of money you had on deposit during 2011, then that's the amount you declare. At the same time, the fact that at the end of 2012, more will have accrued is irrelevant and doesn't need reporting. The day of receipt is the key date. This is the same in all tax regimes.


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## snikpoh

CapnBilly said:


> Don't quite understand this, as the final balance in your account is irrelevant with regard to your income.
> 
> But it is still required for the tax return (or so my tax accountant says).
> 
> You can use an average rate, and I think Hacienda do publish one, but I have yet to find it on their website. You can always calculate your own, by adding up the rate for every day of the year and dividing by 365.
> 
> If you receive a sterling income that is converted and paid to you I.e a state pension, then I would use the rate that you received. If, like me you receive a sterling income, but manage your own exchange rate conversions, then I use the exchange rate on the day it is paid ( this is what I meant by official calculations earlier, so I use the ECB rate I linked to). I apply the same principal to interest received.
> 
> I still don't understand - you pay tax on the euros in your Spanish bank. Therefore exchange rates don't come into it surely? What am I missing here?
> 
> To a certain extent it doesn't matter what rate you use, and you just report an amount. However, if you get asked to provide justification, then you don't want to get into an argument with them, and this is why I use the ECB rate, as its an officially published rate. Whatever system you use, you need to keep a record that you can refer to. Having just been asked to provide some evidence to support an item on my last return, I know that you only get 10 working days to comply. In addition, any evidence you provide has to be officially translated into Castilian if its in another language.
> 
> Well, if its income then you need to convert it, using a method above. If its a year end balance under modelo 720, then you use the rate on the 31st December.
> 
> But this is not relevant as the poster was talking about doing tax returns and NOT asset reporting
> 
> I know you know this, but interest earned in the UK has always had to be declared, it's just that they know you have an interest bearing asset if you report. With regard to the interest earned, it's not based on a calendar year, it's on the day of receipt, so the difference in tax years is irrelevant. So for example, if you were a non resident in 2011, and returned to Spain on the 1st January 2012, and on the 2nd received interest of £5,000 ( I wish) in respect of money you had on deposit during 2011, then that's the amount you declare. At the same time, the fact that at the end of 2012, more will have accrued is irrelevant and doesn't need reporting. The day of receipt is the key date. This is the same in all tax regimes.
> My point here is where income (interest) is paid monthly or any way other than annually. Here I guess one has to work through bank statements and work it out from there - totally ignoring any tax certificate.


Still confused why rates are important unless we are talking about someone earning money outside of Spain.

On the point about bringing a pension in monthly and so what rate to declare. Surely the answer is not to bother. Simply declare the amount of euros entering your Spanish bank and total for the year. It's then irrelevant what this was in sterling!


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## Stravinsky

CapnBilly said:


> My understanding is that the value is based on the acquisition value converted at the exchange rate on the 31st December
> 
> _If a person / company owns / beneficial owner of a property abroad whose purchase price consists in a currency other than the euro and is required to file information return, what is the exchange rate that should be used to determine the value acquisition?
> In the case of buildings, the purchase value, as in the other property and rights subject to declaration, must conform to the prevailing exchange rate on the date December 31 of the year to which the information declared._


So if someone bought their house 30 or 40 years ago for £40k and its now worth £200k, they declare it at the acquisition value of £40k?


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## CapnBilly

Stravinsky said:


> So if someone bought their house 30 or 40 years ago for £40k and its now worth £200k, they declare it at the acquisition value of £40k?


Well now, thats a very good question. The simple answer is yes, The more complicated is, does it need to be declared. I don't have a property so it doesn't affect me, so I haven't really thought about it. However, reading the law it says under 54b 2d it clearly says you have to report the acquisition value, as I posted. However, in 54b 6d it says

_6. The information required under this article shall not be applicable in respect of the following properties or rights over immovable property situated abroad:
d) There shall be no obligation to report on any property or interest in real property when the securities referred to in paragraphs 2.d), 3 and 4 did not exceed jointly 50,000 euros. If this limit is exceeded assembly should learn all property and rights to property._

para 3 and 4 are about time share and usufructs etc, so just different types of property.

I must admit that doesn't make sense, so looking at 19/1991 where it explains how to value for wealth tax (which is the basis of quite a lot of the valuations in the new law) it says

_By the highest of the following three: the rateable value, the proven by the Administration for the purpose of other taxes or price, consideration or value of the acquisition._

There will be no cadastral value for a house in the UK (there;s a rateable value, but I think thats calculated on a different basis), there's no value by the Administration, so ergo, it must be the acquisition value.

Think you'd better see you gestoria again


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## CapnBilly

snikpoh said:


> Originally Posted by CapnBilly
> Don't quite understand this, as the final balance in your account is irrelevant with regard to your income.
> 
> But it is still required for the tax return (or so my tax accountant says).
> 
> *I'm not aware of anywhere in a personal tax return that you have to provide that information, unless its something to do with your property dealings. I personally have never provided it.*
> 
> You can use an average rate, and I think Hacienda do publish one, but I have yet to find it on their website. You can always calculate your own, by adding up the rate for every day of the year and dividing by 365.
> 
> If you receive a sterling income that is converted and paid to you I.e a state pension, then I would use the rate that you received. If, like me you receive a sterling income, but manage your own exchange rate conversions, then I use the exchange rate on the day it is paid ( this is what I meant by official calculations earlier, so I use the ECB rate I linked to). I apply the same principal to interest received.
> 
> still don't understand - you pay tax on the euros in your Spanish bank. Therefore exchange rates don't come into it surely? What am I missing here?
> 
> *I think the original poster was asking about the rate because they have sterling income, even though it may be paid in euros i.e a state pension from the UK. I personally recive a sterling income, but I only convert about two thirds of it for day to day living, so the rest remains in sterling. for tax purposes I convert it all notionally at the ECB rate. *
> 
> To a certain extent it doesn't matter what rate you use, and you just report an amount. However, if you get asked to provide justification, then you don't want to get into an argument with them, and this is why I use the ECB rate, as its an officially published rate. Whatever system you use, you need to keep a record that you can refer to. Having just been asked to provide some evidence to support an item on my last return, I know that you only get 10 working days to comply. In addition, any evidence you provide has to be officially translated into Castilian if its in another language.
> 
> Well, if its income then you need to convert it, using a method above. If its a year end balance under modelo 720, then you use the rate on the 31st December.
> 
> But this is not relevant as the poster was talking about doing tax returns and NOT asset reporting
> 
> *This was in answer to your question,
> 
> The only time I can see that being an issue, is if you hold a sterling account in Spain - how does that get reported for tax purposes?*_
> 
> I know you know this, but interest earned in the UK has always had to be declared, it's just that they know you have an interest bearing asset if you report. With regard to the interest earned, it's not based on a calendar year, it's on the day of receipt, so the difference in tax years is irrelevant. So for example, if you were a non resident in 2011, and returned to Spain on the 1st January 2012, and on the 2nd received interest of £5,000 ( I wish) in respect of money you had on deposit during 2011, then that's the amount you declare. At the same time, the fact that at the end of 2012, more will have accrued is irrelevant and doesn't need reporting. The day of receipt is the key date. This is the same in all tax regimes.
> 
> My point here is where income (interest) is paid monthly or any way other than annually. Here I guess one has to work through bank statements and work it out from there - totally ignoring any tax certificate
> 
> *Spot on. The tax certificate just confuse the issue*
> 
> _


_




snikpoh said:



Still confused why rates are important unless we are talking about someone earning money outside of Spain.

Click to expand...

*That what I though the OP was asking about, unless I am mistaken *



snikpoh said:



On the point about bringing a pension in monthly and so what rate to declare. Surely the answer is not to bother. Simply declare the amount of euros entering your Spanish bank and total for the year. It's then irrelevant what this was in sterling!

Click to expand...

*As I thought I explained I manage my own exchange, as do a lot people, so for example, before Christmas I bought enough euros to last me 6 months, using my own capital. Those euros are in my account on deposit, they are not income. Since then I have received 3 pensio payments, all of which are still in sterling*_


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## CapnBilly

CapnBilly said:


> Well now, thats a very good question. The simple answer is yes, The more complicated is, does it need to be declared.
> 
> Think you'd better see your gestoria again


Checked with my gestoria, and she confirms that my analysis was correct, the reporting requirement is based on the acquisition value, so that's about £40,806.


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## Stravinsky

CapnBilly said:


> Checked with my gestoria, and she confirms that my analysis was correct, the reporting requirement is based on the acquisition value, so that's about £40,806.


Why does that not surprise me .... how ridiculous is that then!


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## CapnBilly

Stravinsky said:


> Why does that not surprise me .... how ridiculous is that then!


It just doesn't make sense to me. I could understand if you had to report the acquisition value, but the reporting requirement was based on the current value. 
But what do I know, I'm just a simple fellow, who's just trying to live in peace, and comply with the laws of the land where I live. They just seem determined to make it difficult. 

I posted earlier about having to provide evidence to support last years tax return, and I have to have my P60 translated into Spanish. !!!!. It's just numbers, with the a few words, that are pretty clear, not a essay.


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## Stravinsky

CapnBilly said:


> It just doesn't make sense to me. I could understand if you had to report the acquisition value, but the reporting requirement was based on the current value.
> But what do I know, I'm just a simple fellow, who's just trying to live in peace, and comply with the laws of the land where I live. They just seem determined to make it difficult.
> 
> I posted earlier about having to provide evidence to support last years tax return, and I have to have my P60 translated into Spanish. !!!!. It's just numbers, with the a few words, that are pretty clear, not a essay.


I bet you they tell you that you have to get it notarised, costing a fortune of your heavily taxed income!


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## stevelin

Still rather confused about if I need to declare I have a local government pension which I have not yet taken ( as still to young) do I have to declare this as I can take a lump sum on retirement as well as a monthly pension ?


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## Stravinsky

stevelin said:


> Still rather confused about if I need to declare I have a local government pension which I have not yet taken ( as still to young) do I have to declare this as I can take a lump sum on retirement as well as a monthly pension ?


Government pensions dont need to be declared in Spain under the dual taxation treaty. If I were staying a tax resident, I would not be declaring ours


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## Stravinsky

stevelin said:


> Still rather confused about if I need to declare I have a local government pension which I have not yet taken ( as still to young) do I have to declare this as I can take a lump sum on retirement as well as a monthly pension ?


Actually just checking, thats paid by Capita Hartshead?

As we have a state and Govt pension, the govt pension is taxed in the UK taking account of the UK allowances, and the State pension comes here to be taxed using the Spanish allowances.


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## stevelin

Thanks Stravinsky
Yes I agree about not declaring for yearly tax but should I be declaring the pension "pot" under this 50,000 + declaration


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## Stravinsky

stevelin said:


> Thanks Stravinsky
> Yes I agree about not declaring for yearly tax but should I be declaring the pension "pot" under this 50,000 + declaration



Well ... thats a good question. I can tell you that my tax gestor here in Spain says no, because its not something I actually have access to or am drawing from. He said the same about insurance policies, because of course they only have a value if you peg it. However on that last point he is trying to get clarification


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## CapnBilly

Stravinsky said:


> Well ... thats a good question. I can tell you that my tax gestor here in Spain says no, because its not something I actually have access to or am drawing from. He said the same about insurance policies, because of course they only have a value if you peg it. However on that last point he is trying to get clarification


I don't believe you have to declare pensions that are not in payment. As far as life insurance, i understand you don't have to declare unless, the policy is written such that there is a beneficiary, rather than your estate. I thought i'd read this, but i can't see it now.

The law states you have to report the surrender value, but of course, there isn't one for a life policy.


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## Stravinsky

CapnBilly said:


> I don't believe you have to declare pensions that are not in payment. As far as life insurance, i understand you don't have to declare unless, the policy is written such that there is a beneficiary, rather than your estate. I thought i'd read this, but i can't see it now.
> 
> The law states you have to report the surrender value, but of course, there isn't one for a life policy.


Thats what I understood too, but the gestor was waiting for clarification from the tax man!


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## gcumming

Nice to see that, having read the thread, many other people seem as confused as I am. My wife has enough in her name (house sale) that she will definitely have to declare, but I'm not sure if I will have to - I have bit of private pensions in UK and Ireland, and contributions to a university scheme in Ireland. All told, that might be near the limit, but frankly how would you value a defined benefit scheme. Has anyone had positive confirmation from anyone official that pensions not currently being drawn upon are exempt from the new foreign assets declaration?

Soounds like the law was introduced in a hurry without any clear thinking of how to actually apply it...... clearly as usual the people caught out will be 'ordinary' savers, not the ultr-rich who have most of the assets, and have an expensive solicitor to figure it all out.


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## gcumming

Ah - actually found something that could pass as information on the agencia tributaria website. Shame I have only 9 months of Spanish and can't make much sense of it:

Agencia Tributaria - Obligación de declarar

One in particular looks pertinent:

1. ¿Existe obligación de declarar los planes de pensiones contratados en el extranjero? 

No existe obligación de información sobre los planes de pensiones (de las aportaciones a los mismos) en tanto no se produzca la incidencia que da lugar al cobro de la pensión en modo de renta temporal o vitalicia.

El artí**** 42 ter del Reglamento General aprobado por el RD 1065/2007, de 27 de julio, remite a la Ley del Impuesto sobre el Patrimonio para la valoración de determinadas rentas. En concreto esta remisión existe para el caso de las rentas temporales y vitalicias.

Artí**** 17 de la Ley del Impuesto sobre el Patrimonio en su apartado Dos establece que las rentas temporales o vitalicias constituidas como consecuencia de la entrega de un capital en dinero, bienes muebles o inmuebles, deberán computarse por su valor de capitalización (en la fecha del devengo del impuesto), aplicando las mismas reglas que para la constitución de pensiones se establecen en el Impuesto sobre Transmisiones Patrimoniales y Actos Jurídicos Documentados. El artí**** 10.2.f de la Ley de ITPyAJD valora las “la base imponible de las pensiones” capitalizándolas.

To me the first bit reads as though there is definitely no obligation to report a pension plan you are not drawing upon. But one you are drawing on? I got lost after the first paragraph, even with (or despite?) the help of Google Translat


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## 90199

Does anyone have a link for the financial requirements that require the said declaration to be submitted?


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## CapnBilly

Hepa said:


> Does anyone have a link for the financial requirements that require the said declaration to be submitted?


http://www.boe.es/diario_boe/txt.php?id=BOE-A-2012-14452


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## gcumming

I think that the gist is that if you have >€50k in any of three groups of investments, you need to declare. Basically these three groups are cash in accounts, investments and property. There's a short and almost comprehensible outline at the link below, and more detail in the link to FAQs I posted yesterday:

Agencia Tributaria - Preguntas frecuentes: Modelo 720


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## stevelin

Found this info as well if you click on question they give the answer 
Agencia Tributaria - Obligación de declarar


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## Toodunnsk

*Exchange rate*

Re our normal tax returns, our tax abogado, told us the hacienda dictate what exchange rate they use. In our case we have always been taxed on more euros than we have actually received which doesn't seem very fair. Anyone else know if this is correct procedure or not?


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## CapnBilly

Toodunnsk said:


> Re our normal tax returns, our tax abogado, told us the hacienda dictate what exchange rate they use. In our case we have always been taxed on more euros than we have actually received which doesn't seem very fair. Anyone else know if this is correct procedure or not?


Abogados tend to use the average rate for the year that the Hacienda publish. If you provide them with the sterling information, then they will just use this to work out the euro equivalent. However, there is no reason why you cannot provide them with the euro amount, using either the rate you actually receive, e.g if you receive a pension already converted, or, if you don't convert straightaway, the rate on the day you actually receive the income. As far as Hacienda are concerned they just see your income in euros. If they ask you to provide any evidence of the income, then you would need to provide that. All three methods ( average, actual or rate of the day) would be acceptable. I personally use the ECB published rate of the day. You can download the historical rates from 1999 here http://www.ecb.int/stats/exchange/eurofxref/html/index.en.html


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## tikievans

*Declaration of Overseas assets to Spanish Tax Authority*

Hi, we are all aware that we now have to declare our assets outside of Spain in 3 categories (money, property, investments) if in any of the categories the sum total of the value exceeds €50,000. 

I have just returned from my tax advisor (Spanish I may add) and she insists that we do not have to declare our flat in England because when we bought it (1997) the value was only €40,000. There is no place on the form (she says) to estimate its current value, the only info required is the value at purchase. 

Have other people had the same advice? I am very nervous at not declaring it as if the Spanish authorities find out about the flat at a later date and the advice was incorrect (ie the value at 31st Dec 2012 should have been quoted) they can fine me the full value of the asset plus some. HELP!


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## snikpoh

tikievans said:


> Hi, we are all aware that we now have to declare our assets outside of Spain in 3 categories (money, property, investments) if in any of the categories the sum total of the value exceeds €50,000.
> 
> I have just returned from my tax advisor (Spanish I may add) and she insists that we do not have to declare our flat in England because when we bought it (1997) the value was only €40,000. There is no place on the form (she says) to estimate its current value, the only info required is the value at purchase.
> 
> Have other people had the same advice? I am very nervous at not declaring it as if the Spanish authorities find out about the flat at a later date and the advice was incorrect (ie the value at 31st Dec 2012 should have been quoted) they can fine me the full value of the asset plus some. HELP!


There are other threads running on this topic.

However, she is correct. Daft as it may sound, what the authorities are asking for is PURCHASE PRICE - no matter how long ago!

How would you value the flat - it's only worth what someone ends up paying you for it. One could argue that one could use the 'rateable value' but even that is likely to be out of date.


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## tikievans

Thanks for that it will help me sleep at night.


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## 90199

We have been advised to the contrary, it is part of the total wealth, I will have to declare an interest in a house where the purchase price was 3820 GBP in 1973.

I wonder who is correct. My friend at the tax office says the form and declarations are Muy Muy complicado......................Ah well bureaucracy at its best!!


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## tikievans

Hepa said:


> We have been advised to the contrary, it is part of the total wealth, I will have to declare an interest in a house where the purchase price was 3820 GBP in 1973.
> 
> I wonder who is correct. My friend at the tax office says the form and declarations are Muy Muy complicado......................Ah well bureaucracy at its best!!


Back to sleepless nights!


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## Turtles

And what's the latest thinking on whether we should declare private pensions that we won't be claiming for another 20 years?


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## snikpoh

Hepa said:


> We have been advised to the contrary, it is part of the total wealth, I will have to declare an interest in a house where the purchase price was 3820 GBP in 1973.
> 
> I wonder who is correct. My friend at the tax office says the form and declarations are Muy Muy complicado......................Ah well bureaucracy at its best!!


If you read the hacienda website and subsequent FAQ's, it's clearly stated that you declare the 'purchase price' - my abogado/assesor confirms my translation.

However, I don't see that it will matter given that there are (currently) no consequences of making this declaration.

... and, yes, they are complicated to understand and interpret ...


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## Overandout

I would suggest that you don't rely on the advice of only one "expert".

I have recently been told by a supposed financial advisor that my wife and I don't have to declare our bank acount because when divided between the two named acount holders our individual shares don't exceed 50k€. 

I know that this is wrong and have challenged that advice, but if I didn't know I may have just accepted this as being correct, and you can guarantee that the advisor will not accept any responsibility of erroneous advice given when the doodoo hits the fan later....


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## gus-lopez

Overandout said:


> I would suggest that you don't rely on the advice of only one "expert".
> 
> I have recently been told by a supposed financial advisor that my wife and I don't have to declare our bank acount because when divided between the two named acount holders our individual shares don't exceed 50k€.
> 
> I know that this is wrong and have challenged that advice, but if I didn't know I may have just accepted this as being correct, and you can guarantee that the advisor will not accept any responsibility of erroneous advice given when the doodoo hits the fan later....


Just in case you weren't sure the advisors, assesor, accountants have NO responsibility whatsoever even if they are criminally negligent. They are classed as working for you & you are expected to check that they have acted correctly.
Any non-payment of tax on their behalf for you is your responsibility & would have to be made p by you along with fines for late payment etc. Any action against the wrongdoer would actually have to be initiated by you , as unbelievable as it might seem !


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## gus-lopez

snikpoh said:


> If you read the hacienda website and subsequent FAQ's, it's clearly stated that you declare the 'purchase price' - my abogado/assesor confirms my translation.
> 
> However, I don't see that it will matter given that there are (currently) no consequences of making this declaration.
> 
> ... and, yes, they are complicated to understand and interpret ...


The consequences are purchased for 3820 in 1973, sell for 400k in 2013 . 
Spanish multiplication factor of lets say 2.2 = 400k -8404=391,596 x tax at 53% (?) = not much left when a UK citizen wouldn't pay anything !! & a large contribution to the pockets of the corrupt. 
Spanish tax policies are not set up for the gains that can be made on UK properties & the system is geared for the negligible amounts declared by spanish sellers & the UK system isn't geared up to allow the spanish resident seller to cart it off in a bin liner.

The consequences of making the declaration are actually horrendous if you make it incorrectly.


----------



## samthemainman

I moved to Spain in August 2012 and obtained residency by October. I'm paid by my company in the UK who let me live in Spain (lucky me- so far). Last year I was tax resident in the UK bit the 2013-14 tax year will be in Spain combined with a self assessment for the UK. The question is - I inherited my late mothers house worth around £150K which I currently rent out. Do I declare it this year or next? The house was built in the 1960s and bought new by my dad for about £5K.


----------



## snikpoh

samthemainman said:


> I moved to Spain in August 2012 and obtained residency by October. I'm paid by my company in the UK who let me live in Spain (lucky me- so far). Last year I was tax resident in the UK bit the 2013-14 tax year will be in Spain combined with a self assessment for the UK. The question is - I inherited my late mothers house worth around £150K which I currently rent out. Do I declare it this year or next? The house was built in the 1960s and bought new by my dad for about £5K.


Firstly, the value of the property for you is £150k because that's when it passed to you. What someone else paid for it before you is irrelevant.

I would think that if you have rental income this year, then it will be on next year's income tax form. Similarly, if you inherited the house this year, then it will be on next years asset declaration otherwise, it will be in this years form covering 2012.


----------



## snikpoh

gus-lopez said:


> The consequences are purchased for 3820 in 1973, sell for 400k in 2013 .
> Spanish multiplication factor of lets say 2.2 = 400k -8404=391,596 x tax at 53% (?) = not much left when a UK citizen wouldn't pay anything !! & a large contribution to the pockets of the corrupt.
> Spanish tax policies are not set up for the gains that can be made on UK properties & the system is geared for the negligible amounts declared by spanish sellers & the UK system isn't geared up to allow the spanish resident seller to cart it off in a bin liner.
> 
> The consequences of making the declaration are actually horrendous if you make it incorrectly.


Do they not have tapered relief like in UK? Also, surely one can take into account that it was (or may have been) your main property before you moved to Spain.

I think you're scaremongering (not sure of your agenda) without taking everything into account.

[IMHO]


----------



## gus-lopez

snikpoh said:


> Do they not have tapered relief like in UK? Also, surely one can take into account that it was (or may have been) your main property before you moved to Spain.
> 
> I think you're scaremongering (not sure of your agenda) without taking everything into account.
> 
> [IMHO]


What do you think the 2,2 is ? No ,Spanish tax rates are not set up for the huge gains possible on UK property. 
Whether or not it was your 'main' property before you came to Spain is irrelvant. The Hacienda assumes that ALL foreigners own property in there own countries & it is up to you to prove them incorrect, not for them to prove they are. 

The example I gave would be exactly the same for anyone owning a single property that was there main home here in Spain. If you bought for 50k & sold for 200k the CGT is 150k less expenses. Even if you elect to roll it over by purchasing another property it will always be there , waiting to be paid ,in the background for as long as you live. They are draconian amounts which makes you understand why the majority of spaniards do not move, change cars etc.
I am certainly not scaremongering.


----------



## paul44

Personally I think this is only the start and once a residents total wealth is known wham they'll be hit by some tax still to be thought out for the future. I wouldn't trust the gov one bit as there skint! on the flip side I don't trust any gov there all robbers in sheeps clothing as seen here in Ireland.

Me and the ball and chain were looking forward to moving full time to Spain but that's now off the agenda it will be long visits not exceeding 183 days for us in future

Think Spain are going to score an own goal on this one but then again they seem to score them quite often!!!!!


----------



## Toodunnsk

*exchange rate*

I normally do a spreadsheet showing the amount in sterling, the amount we receive into our bank here in euros and provide the pension information from my husband´s company showing in writing what they send. I only realised last year that they hadn´t used the euro figure I gave them and when I queried it they told me the hacienda dictated the exchange rate. May have to change my abogado then if this is not correct.


----------



## Guest

Toodunnsk said:


> I normally do a spreadsheet showing the amount in sterling, the amount we receive into our bank here in euros and provide the pension information from my husband´s company showing in writing what they send. I only realised last year that they hadn´t used the euro figure I gave them and when I queried it they told me the hacienda dictated the exchange rate. May have to change my abogado then if this is not correct.


The hacienda have always dictated the rate. They use one rate for the whole year.


----------



## Stravinsky

*


paul44;1086070[B said:



]Personally I think this is only the start and once a residents total wealth is known wham they'll be hit by some tax still to be thought out for the future.

Click to expand...

*


paul44;1086070[B said:


> [/B] I wouldn't trust the gov one bit as there skint! on the flip side I don't trust any gov there all robbers in sheeps clothing as seen here in Ireland.
> 
> Me and the ball and chain were looking forward to moving full time to Spain but that's now off the agenda it will be long visits not exceeding 183 days for us in future
> 
> *Think Spain are going to score an own goal on this one but then again they seem to score them quite often!!!!!*


Thats why I'm voting with my feet


----------



## Guest

paul44 said:


> Personally I think this is only the start and once a residents total wealth is known wham they'll be hit by some tax still to be thought out for the future. I wouldn't trust the gov one bit as there skint! on the flip side I don't trust any gov there all robbers in sheeps clothing as seen here in Ireland.
> 
> Me and the ball and chain were looking forward to moving full time to Spain but that's now off the agenda it will be long visits not exceeding 183 days for us in future
> 
> Think Spain are going to score an own goal on this one but then again they seem to score them quite often!!!!!


The law as it stands is no different now than it has ever been. If you live in Spain and you pay your taxes here, then you have an obligation to be taxed on your world wide assets. That is exactly the same in the UK whoever pays tax. There are circumstances to take into account. Some residents are taxed in the UK, such as ex military personnel, or civil servants, but with dual taxation, your gestoria can take that into account. There is no need to fear the system, you just need to be honest in your dealings.


----------



## mrypg9

I went to a Seminar organised to explain this new requirement this week. It became clear that many immigrants do not understand the difference between assets and income derived from assets so there was needless panic amongst some. One woman asked about her bus pass....

The sharp-suited gentleman giving the talk confirmed that this new requirement was essentially a complicated cross-referencing exercise, aimed at catching wealthy Spanish individuals and companies who had avoided declaring assets held offshore or tucked away somewhere. It is no way aimed specifically at British immigrants or immigrants of any nationality. He confirmed that it was belatedly lining Spain up with other EU states. The UK requires all tax residents, regardless of nationality, to declare all assets held whether in the UK or overseas.

I see no need for immediate panic and that's not just because I no longer have assets over £50k. I did when I left the UK seven years ago but I have enjoyed spending it here and in Prague on fancy cars, renting fancy houses and dining out. Fortunately I have a reasonable income so I won't starve. But my partner has assets from the sale of properties in the UK invested in the UK and also offshore so will be required to report them and, after taking the best advice available, will so do.
Her surname begins with W so we are confidently expecting that by the time Hacienda gets to the end of the alphabet one of two things will have transpired: we'll both be dead or will have spent it all.
Even if they have some other mode of tackling this huge task of cross-referencing with existing tax declaration information other than alphabetically, we have a feeling that since my partner has been waiting two years for her health card, it will take quite a while before any reporting error made by any 'expert' we will employ is noticed....


----------



## jimenato

mrypg9 said:


> ...The UK requires all tax residents, regardless of nationality, to declare all assets held whether in the UK or overseas...


That surprises me. All the Brits who own holiday homes on the Costas have to tell the UK taxman?


----------



## Guest

jimenato said:


> That surprises me. All the Brits who own holiday homes on the Costas have to tell the UK taxman?


Absolutely!


----------



## 90199

Tejeda said:


> Absolutely!


You sure? I only had to declare overseas assets if I was obtaining income from them.


----------



## Guest

Hepa said:


> You sure? I only had to declare overseas assets if I was obtaining income from them.


If you intend to live there, possibly not. However, if it is an investment, then you will need to declare it.


----------



## 90199

Tejeda said:


> If you intend to live there, possibly not. However, if it is an investment, then you will need to declare it.


But only if or when the investment matures, if it remains static or loses there is no point declaring. The taxman only wants winners, losers do not really interest him.


----------



## mrypg9

jimenato said:


> That surprises me. All the Brits who own holiday homes on the Costas have to tell the UK taxman?


Yes. Doesn't it state on your tax return that you must declare all assets whether in the UK or overseas *plus* any income derived from them?

Mine did. You will only be liable for tax if you receive income, of course.


----------



## mrypg9

Hepa said:


> You sure? I only had to declare overseas assets if I was obtaining income from them.


The new requirement is for you to declare your total assets whether in Spain or the UK REGARDLESS of whether you receive income from them, if their value exceeds 50k euros..

But as Tejeda has pointed out, if you do receive income from an asset wherever such asset is located you should have declared it to Hacienda anyway. So I can't for the life of me see why anyone should see this as a 'threat'.


----------



## 90199

I was talking about a declaration to the HMRC.

I have been told by the Tax people here that I only need to declare rental income, where a rental contract is signed, they were not interested in my properties here, because they are aware of them anyway.


----------



## Guest

Hepa said:


> I was talking about a declaration to the HMRC.
> 
> I have been told by the Tax people here that I only need to declare rental income, where a rental contract is signed, they were not interested in my properties here, because they are aware of them anyway.


I think we are all agreed, paying tax and sorting through all the regulations is a pain in the ..........


----------



## Guest

Tejeda said:


> I think we are all agreed, paying tax and sorting through all the regulations is a pain in the ..........


Neck!


----------



## patrick2976

One method of 'ring fencing' securities (bonds and equities) is to place them in a Spanish compliant offshore portfolio bond. No tax payable on gains whilst they remain in the tax wrapper and a very favourable tax position on withdrawal. Of course you are declaring your assets at 31 Dec 2012 on this years modelo 720 but it's a good idea for the future.....


----------



## jimenato

mrypg9 said:


> ...The UK requires all tax residents, regardless of nationality, to declare all assets held whether in the UK or overseas...


Nope - sorry don't believe it. My car, bicycle, sailing dinghy? Something's wrong here.:confused2:


----------



## gus-lopez

jimenato said:


> Nope - sorry don't believe it. My car, bicycle, sailing dinghy? Something's wrong here.:confused2:


Not the car but the others depending on value could be liable to cgt.

HM Revenue & Customs: Is your asset liable to Capital Gains Tax?

& definitely any foreign property, land ,etc.


----------



## mrypg9

Not everything you own is an 'asset'. 

I have an extensive library of volumes relating to European history and politics over the last two hundred years plus a large collection of major works of English and European literature. To me, it's beyond price value although it represents £000s of expenditure.
HMRC don't see it as an 'asset'.

I'm concerned that my son doesn't consign it all to the flames when Sandra and I have shuffled our mortal coils. He is a Philistine.

That reminds me of a favourite joke:

A woman was up before the judge for being drunk and disorderly in a synogogue. The judge rebuked her for her conduct in such a place, saying she was a Philistine.

'I was before I got married', she replied, 'But now I'm a Phyllis Goldberg'.

Today has started badly for me so a little humour might lighten my mood....


----------



## Stravinsky

mrypg9 said:


> The new requirement is for you to declare your total assets whether in Spain or the UK REGARDLESS of whether you receive income from them, if their value exceeds 50k euros..
> 
> But as Tejeda has pointed out, if you do receive income from an asset wherever such asset is located you should have declared it to Hacienda anyway. *So I can't for the life of me see why anyone should see this as a 'threat'.*


Well, for those that don't own that much in the UK or haven't invested in their future in the UK then I can see the point.

However ...... for those that have any substantial assets in the UK and have spent many years amassing them (and already having paid tax on them) you might be able to understand that the Spanish taxman asking for minute details of those assets might seem a little worrying to some.

I have _never _shirked from declaring anything to the Spanish authorities, and have _always_ stayed on the right side of the law. If they had asked me for values of assets outside the UK then I would have given them.

However I will _not_ disclose every minute detail down the the policy numbers of investments, IBAN of bank accounts and all else, to be recorded on a system which is not known to be that secure. I have never had to do that in the UK, and I will not do that here. I concur with a general view around that these details will be taken down and used against you in the future


----------



## 90199

We have been Gestor Hunting.

The first was of the female gender, and when we presented her with our asset declaration problem and the printed copy of the advice sheet, her eyes went like those of a frightened rabbit, the poor girl had no knowledge of these new laws whatsoever. She suggested we go elsewhere and readily provided us with the location of her competitors.

The second a male, partly unshaven with two days growth, when presented with the question, are you aware of the action need to be taken by foreigners in respect of modelo 720, He replied, "Yes of course, there is more information coming out at 11. A.M. tomorrow,"

Blooming Eck !! you could have knocked me over with a feather, here on El Hierro a Gestor that seems to know what he is talking about.

We are going to see him again on Friday. I am amazed, I thought a trip to Tenerife would have to be navigated.


----------



## xabiaxica

Hepa said:


> We have been Gestor Hunting.
> 
> The first was of the female gender, and when we presented her with our asset declaration problem and the printed copy of the advice sheet, her eyes went like those of a frightened rabbit, the poor girl had no knowledge of these new laws whatsoever. She suggested we go elsewhere and readily provided us with the location of her competitors.
> 
> The second a male, partly unshaven with two days growth, when presented with the question, are you aware of the action need to be taken by foreigners in respect of modelo 720, He replied, "Yes of course, there is more information coming out at 11. A.M. tomorrow,"
> 
> Blooming Eck !! you could have knocked me over with a feather, here on El Hierro a Gestor that seems to know what he is talking about.
> 
> We are going to see him again on Friday. I am amazed, I thought a trip to Tenerife would have to be navigated.


maybe it's the way you asked........ it's not just foreigners who have to report assets abroad - it's everyone

I actually got a letter in the post from my gestor about it - but since I haven't any foreign assets (or any assets much ) I didn't really read it carefully

I'll take a closer look tomorrow & report if there's anything we've missed here


----------



## 90199

xabiachica said:


> maybe it's the way you asked........ it's not just foreigners who have to report assets abroad - it's everyone
> 
> I actually got a letter in the post from my gestor about it - but since I haven't any foreign assets (or any assets much ) I didn't really read it carefully
> 
> I'll take a closer look tomorrow & report if there's anything we've missed here



No, the first one was presented with the advice sheet and she had no knowledge whatsoever, the second chap had the information already on his desk.

I have had a complicated existence, I have an interest in two properties abroad plus an investment portfolio.

I know of locals with assets in other places, I'll bet a pound to a penny that they have never been declared.

I think I shall liquidate my assets, wonder if I could drink them before the proximate declaration in 2014


----------



## RobMcL

Hepa said:


> He replied, "Yes of course, there is more information coming out at 11. A.M. tomorrow,"



Nice way to buy time... That's what I reply at work whenever I'm asked for something I don't know about! ;-)

Am I right in thinking anyone spending less than 183 days in Spain per year are therefore not resident and therefore have no obligation on declarations? I know the French are trying to clamp down and tighten the tax net on people spending even less time in the country...


----------



## Stravinsky

RobMcL said:


> Nice way to buy time... That's what I reply at work whenever I'm asked for something I don't know about! ;-)
> 
> *Am I right in thinking anyone spending less than 183 days in Spain per year are therefore not resident and therefore have no obligation on declarations?* I know the French are trying to clamp down and tighten the tax net on people spending even less time in the country...


You are correct in that assumption, the year running to 31 December


----------



## 90199

We have just been to the Gestoria, he seems to know what he is about, having had to deal with a large amount of Venezuelan immigrants. 

My interests in two properties in England, of which the total joint purchase price does not exceed 50,000€ do *NOT* have to be declared.

Well, I questioned him on this, however he further stated, that neither did my English bank accounts also being under 50,000€

It is just my portfolio of investments that need declaring, and he is sorting the paperwork for that.


----------



## Overandout

Hepa said:


> We have just been to the Gestoria, he seems to know what he is about, having had to deal with a large amount of Venezuelan immigrants.


That's a suprise, the few Venezuelans that I know have had any assets worth 50k expropriated bt the late comandante.....


----------



## gus-lopez

I knew there was a reason for it ! 

Cyprus eurozone bailout prompts anger as savers hand over possible 10% levy | World news | guardian.co.uk

BBC News - Why Cyprus's rescue matters to us

Cyprus bail-out risks UK troops’ savings - Telegraph


----------



## Kalekas

Cynic that I am, my first thought was 'Smart lad ... he's given himself 24 hours to read up on the issue'


----------



## Kalekas

*Modelo 720*



Hepa said:


> We have been Gestor Hunting.
> 
> The first was of the female gender, and when we presented her with our asset declaration problem and the printed copy of the advice sheet, her eyes went like those of a frightened rabbit, the poor girl had no knowledge of these new laws whatsoever. She suggested we go elsewhere and readily provided us with the location of her competitors.
> 
> The second a male, partly unshaven with two days growth, when presented with the question, are you aware of the action need to be taken by foreigners in respect of modelo 720, He replied, "Yes of course, there is more information coming out at 11. A.M. tomorrow,"
> 
> Blooming Eck !! you could have knocked me over with a feather, here on El Hierro a Gestor that seems to know what he is talking about.
> 
> We are going to see him again on Friday. I am amazed, I thought a trip to Tenerife would have to be navigated.


Cynic that I am, my first thought was 'Smart lad ... he's given himself 24 hours to read up on the issue'


----------



## Stravinsky

I have to share this from another forum, posted by someone whos views I respect. I post it because it should send out a severe warning to all of us that own property in the UK and only makes me feel happier about my decision to become non tax resident in Spain. It only serves to enforce worries about why the detail required for these declarations

"_Apparently UK property owned by Spanish tax residents is liable for the "imputed rental income tax" that applies to Spanish property owned by non residents or by residents who own second homes. The "second home" can be outside Spain and still be liable for this tax.

I doubt that many expat tax residents are aware of this and of course as you now have to declare the ownership of these properties there could be an interesting demand for unpaid tax.

In Spain the tax is based on the catastral value. The information I found from a Madrid based advisor is that income is calculated as 1.1% of the value which is deemed to be 50% of the acquisition price (which is what you have to declare on the new asset declaration) This income is added to your normal income and taxed at whatever rate applies depending on your total income.

It would take a few seconds for the Hacienda computers to do a cross check on whether tax has been paid previously on the property you have now declared.

It just gets worse and worse._"


----------



## paul44

Like I mentioned in a post a few days ago this is not just an information gathering exercise it might be short term but believe me sometime in the future anyone who has a few bob will get hit with a new tax.So be very careful what if anything you tell them!


----------



## Stravinsky

Exactly. The view I have taken is once you have declared, theres no going back. They then know what you have. People can tell you that they are only targeting Spanish nationals, but I dont believe it. Everyone will be caught up. After all, did the Cypriots just target Cypriots when they tabled this new tax (which they now seem to be having second thoughts about)


----------



## paul44

I was going to move to Spain lock stock and barrel but there is no way now that I would even consider it everything I own has been properly taxed and I am not going to give anyone any help in trying to burden me with anything else.

So for me now it's just a long break of a few months split over the year 

Regarding the Cypriots maybe they deliberately pitched the numbers low to spook everyone in other country's to put pressure on the EU? if they did its a master stroke and has certainly worked!!!!!


----------



## mrypg9

paul44 said:


> Like I mentioned in a post a few days ago this is not just an information gathering exercise it might be short term but believe me sometime in the future anyone who has a few bob will get hit with a new tax.So be very careful what if anything you tell them!


This is a register of assets over 50k euros. It is applicable to all tax residents of Spain, immigrants and Spanish nationals.
If you are tax resident in Spain and receive income from overseas assets you should already have declared this.
The bank robbery in Cyprus will not apply to foreign banks with branches in Cyprus. It certainly won't apply to assets outside of Cyprus owned by Cypriots or foreign nationals.
Any 'new tax' will be applied using the information Hacienda have already got. This new register will reveal only hithertofore undeclared assets.
I cannot imagine what tax mechanism could be devised which could enable the Spanish -or any government - to help themselves to assets which are outside their jurisdiction. How could the Spanish Government get its sticky fingers on deposits in a UK bank? If anyone could it would be HMG.

Which goes to show that your assets really are not safe in your own country.


----------



## paul44

mrypg9 said:


> This is a register of assets over 50k euros. It is applicable to all tax residents of Spain, immigrants and Spanish nationals.
> If you are tax resident in Spain and receive income from overseas assets you should already have declared this.
> The bank robbery in Cyprus will not apply to foreign banks with branches in Cyprus. It certainly won't apply to assets outside of Cyprus owned by Cypriots or foreign nationals.
> Any 'new tax' will be applied using the information Hacienda have already got. This new register will reveal only hithertofore undeclared assets.
> I cannot imagine what tax mechanism could be devised which could enable the Spanish -or any government - to help themselves to assets which are outside their jurisdiction. How could the Spanish Government get its sticky fingers on deposits in a UK bank? If anyone could it would be HMG.
> 
> Which goes to show that your assets really are not safe in your own country.


Agreed and that's why I would have no intention of giving them a helping hand you can quite truthfully declare tax paid assets but in the future they will devise a tax to strip you yearly of some of it I don't trust them one bit

Anyway everyone to there own,after this new requirement came out I have decided that I won't now live full time in Spain it's not worth the potential hassal of what could come down the line. Obviously folks already in Spain have too.


----------



## mrypg9

paul44 said:


> Agreed and that's why I would have no intention of giving them a helping hand you can quite truthfully declare tax paid assets but in the future they will devise a tax to strip you yearly of some of it I don't trust them one bit
> 
> Anyway everyone to there own,after this new requirement came out I have decided that I won't now live full time in Spain it's not worth the potential hassal of what could come down the line. Obviously folks already in Spain have too.


That's their choice. But this new requirement will make no appreciable difference to anyone who has already declared their assets to Hacienda as if the Spanish Government wishes to increase taxes on income, whether earned or unearned, it has already the mechanism for so doing. But you seem to think that is a decision already taken...

As for 'what could come down the line'.....you could be run down by a bus tomorrow. 
I very much doubt that this new requirement -which of course applies to ALL tax residents not just immigrants - will result in a lemming-like exodus. I know of no immigrants who plan to leave Spain because of this new requirement and at a Seminar I attended, with about fifty British immigrants present, not one declared they were intending to move back to the UK.
Those who can will move assets in Spain to allegedly 'safe' havens such as offshore accounts which is a sensible precaution. We have no large assets in Spain - since leaving the UK we have placed our investments in offshore accounts,not out of fear of some unforeseen future event but because we have moved from between three countries so it's more convenient. We pay all our taxes now as we have always done.

We have no property in Spain or the UK as we sold all properties and business premises we owned. We have absolutely no intention of leaving Spain because of what 'might' happen - how do you know what might or might not happen in the UK? Our combined debt is almost as high as Spain's.

As someone wisely pointed out earlier, there is no 'safe' country anymore. Taxes can be raised and new ones imposed anywhere in the world.


----------



## 90199

Stravinsky said:


> Exactly. The view I have taken is once you have declared, theres no going back. They then know what you have. People can tell you that they are only targeting Spanish nationals, but I dont believe it. Everyone will be caught up. After all, did the Cypriots just target Cypriots when they tabled this new tax (which they now seem to be having second thoughts about)


Not quite Strav, They knew what you had on Dec 31st 2012, make the declaration then set about trying to drink your wealth, or do what they do here, they call a big family meeting and divide the fortune amongst the offspring.


----------



## gus-lopez

mrypg9 said:


> T
> I very much doubt that this new requirement -which of course applies to ALL tax residents not just immigrants - will result in a lemming-like exodus. I know of no immigrants who plan to leave Spain because of this new requirement and at a Seminar I attended, with about fifty British immigrants present, not one declared they were intending to move back to the UK.
> 
> 
> .



What about Strav ?

I know of one locally here & a local forum that I go on , admittedly troubled by the illegal property situation, they'd like to bail out in some fashion.


----------



## Stravinsky

Hepa said:


> Not quite Strav, They knew what you had on Dec 31st 2012, make the declaration then set about trying to drink your wealth, or do what they do here, they call a big family meeting and divide the fortune amongst the offspring.


Actually ... no they dont. I havent made a tax declaration for 2012 because I dont need to. I haven't been here for the required period. So I am lodging a non residents return and making the necessary preparations for extraction 

I have a plan. It will work. It just needed constructive thought and a little red wine


----------



## Stravinsky

gus-lopez said:


> What about Strav ?
> 
> I know of one locally here & a local forum that I go on , admittedly troubled by the illegal property situation, they'd like to bail out in some fashion.



I know of a number of people who are reconsidering their position


----------



## mrypg9

gus-lopez said:


> What about Strav ?
> 
> I know of one locally here & a local forum that I go on , admittedly troubled by the illegal property situation, they'd like to bail out in some fashion.


Strav is the only person I've come across who is intending to go and he ain't gone yet...
Some people may wonder whether the trouble and expense they will have to go to to avoid a supposed tax which currently exists only in their minds is worth it all.
After all, tax on sale of house, low sale price, assuming you can sell.
As I said, this tax in no way increases the ability of Hacienda to impose new taxes - they already have that power if they so wish.

There still seems to be a perception amongst some immigrants that this tax is aimed at them...Well, like the bank theft as was in Cyprus, it applies to everyone with overseas assets regardless of nationality.

We should all calm down a bit....

Power to the people and Parliament of Cyprus. Just goes to show: lay your hands on people's PRIVATE PROPERTY at your peril.
Don't anybody read any 'socialism' into this...this is an instinctive reaction against a threat to property.

Governments Europe-wide should take notice.


----------



## CapnBilly

mrypg9 said:


> Strav is the only person I've come across who is intending to go and he ain't gone yet...
> Some people may wonder whether the trouble and expense they will have to go to to avoid a supposed tax which currently exists only in their minds is worth it all.
> After all, tax on sale of house, low sale price, assuming you can sell.
> As I said, this tax in no way increases the ability of Hacienda to impose new taxes - they already have that power if they so wish.
> 
> There still seems to be a perception amongst some immigrants that this tax is aimed at them...Well, like the bank theft as was in Cyprus, it applies to everyone with overseas assets regardless of nationality.
> 
> We should all calm down a bit....
> 
> .


I agree Mary.

I posted most of this on another site the other day.


I always remember when I first moved here, and someone I met had started a small business. He told me that he went to the gestor with all his books, in order to submit his return. He asked the gestor "how much tax will I have to pay", and he was asked "how much do you want to pay". We all know thats fairly common. Advice to ignore assets outside the UK for tax purposes (including absence of advice) is (or was) the norm.

I think its clear that as well as an information gathering exercise, it is also a tax gathering exercise from those people who haven't been paying the tax they should. At the end of the day, whichever way you look at it, and irrespective of what we do personally, the bottom line is ignoring overseas assets for tax purposes, or underdeclaring income just boils down to tax evasion, which is tacitly accepted by the state (or was). 

For me, that sums up why we are where we are. 

As for raising more taxes, once they have the information, well, that's always a possibility, and is the same in any other country. However, if they wanted to do that, they could do it without the information, by just reducing the allowances on wealth tax back the original €108,000 (or whatever it was) or lower. I would have thought this would raise far more money than a tax on expat overseas assets.

I think it terms of the bigger picture, this declaration, plus the law limiting the amount for cash transactions, is probably the start of trying to cut down the black economy. I think there's a lot of other things they could and should do as well, but overall, I would say cutting back the black economy in any country must be the right thing to do. Then again, I would say that because (as far as I know), I have declared and paid all the tax I should. If everyone did the same then actually, we might be able to pay a bit less.

Don't forget, tax evasion is not only theft from that state, its theft from other tax payers.

I was talking to my son the other day who works in Madrid. He has a very good job, and earns over 6 figures. He was telling me that the tax increases last year cost him about €500 a month. I said, "ooh that a lot". He said, "well. I earn a lot, so its only fair that I pay more". I felt very proud. We must have done something right.


----------



## Turtles

Apart from the annoyance caused by having to waste your time on this, how does it make you feel when you finally sit down to get it sorted out and you see the following?










Every single time I visit a Spanish public sector website I get that. How dense (or cruel) are they that they don't sort this out? With the level of personal financial detail that I have to submit for Modelo 720 I am feeling really uneasy.


----------



## Stravinsky

mrypg9 said:


> Strav is the only person I've come across who is intending to go and he ain't gone yet...
> Some people may wonder whether the trouble and expense they will have to go to to avoid a supposed tax which currently exists only in their minds is worth it all.
> After all, tax on sale of house, low sale price, assuming you can sell.
> As I said, this tax in no way increases the ability of Hacienda to impose new taxes - they already have that power if they so wish.
> 
> There still seems to be a perception amongst some immigrants that this tax is aimed at them...Well, like the bank theft as was in Cyprus, it applies to everyone with overseas assets regardless of nationality.
> 
> *We should all calm down a bit....*
> 
> Power to the people and Parliament of Cyprus. Just goes to show: lay your hands on people's PRIVATE PROPERTY at your peril.
> Don't anybody read any 'socialism' into this...this is an instinctive reaction against a threat to property.
> 
> Governments Europe-wide should take notice.


I'm perfectly calm Mary thank you.

I treat my finances the same way that I treated my business. I take all things into consideration and make a decision based on the big picture and consequences

I consider the large UK tax free lump sum pension amount that I will be getting this year that WONT be taxed by the Spanish tax man

I consider the tax free endowment policies that I have maturing this year that WONT be taxed by the Spanish taxman

I'm considering the £700 a week I will be able to rent my Spanish property for next year in the summer months, grossing around £10k if I dont sell.

I consider the fact that an unsecure system in Spain wont have all my very personal details, and that there will be no risk of future new taxes, should they happen

So is it worth it all Mary? What do you think?

Even tax gestors are uneasy with all this ... but what do they know?


----------



## Stravinsky

CapnBilly said:


> and irrespective of what we do personally, the bottom line is *ignoring overseas assets for tax purposes, or underdeclaring income just boils down to tax evasion, *which is tacitly accepted by the state (or was).


I quite strongly object to being lumped in as a tax evader, which has never ever been our objective here.

Even now, I went to our town hall this morning to check no charges are against our place to find that there are outstanding IBI bills from 2007 that we never received, so now that gets paid.

The fact that the Hacienda are not particularly proactive in making people aware of taxes, and gestors dont seem to know about some taxes relating to expats, doesn't make one a knowing tax evader. If it wasnt for the forums and ex pat circles, I wonder how many would actually know about the asset declaration deadline.

I don't know ONE person around here that was aware for instance that their UK home was subject to tax as a second home. Yes, that means that there is a lot of uncollected tax. However the new reporting system isnt going to find them at the moment because the declaration figure is the purchase price and many of them will be under the €50 figure for long owned properties. Next year the value of course would quadruple or more, showing on paper a huge leap in capital gain.


----------



## CapnBilly

Stravinsky said:


> I quite strongly object to being lumped in as a tax evader, which has never ever been our objective here.
> 
> Even now, I went to our town hall this morning to check no charges are against our place to find that there are outstanding IBI bills from 2007 that we never received, so now that gets paid.
> 
> The fact that the Hacienda are not particularly proactive in making people aware of taxes, and gestors dont seem to know about some taxes relating to expats, doesn't make one a knowing tax evader. If it wasnt for the forums and ex pat circles, I wonder how many would actually know about the asset declaration deadline.
> 
> I don't know ONE person around here that was aware for instance that their UK home was subject to tax as a second home. Yes, that means that there is a lot of uncollected tax. However the new reporting system isnt going to find them at the moment because the declaration figure is the purchase price and many of them will be under the &#128;50 figure for long owned properties. Next year the value of course would quadruple or more, showing on paper a huge leap in capital gain.


Stravinsky, I was not implying that you were a tax evader. I'm sorry if it read that way. My post was following on from another post I made about advisors and gestors advising people to ignore overseas assets, or worse still, as in the case of the UK second home tax, not even advising people properly. I said that I had never seen that mentioned anywhere, until the post you quoted. If you pay an advisor to advise you, then you should be able to rely on that advice. Tax evasion is defined by HMRC and I guess the Hacienda as "Tax evasion is where there is a deliberate attempt not to pay the tax due". I don't believe the second home tax falls into that category, if you have only just discovered the existence.

My post about tax evasion was relating to my view of the bigger picture, and some of the measures being taken , and not just relating to expats. I agree about the Hacienda not being proactive about advising expats, but I still maintain that if you're paying someone for advice, then they should be upto speed.


----------



## Stravinsky

Sorry for misunderstanding 

I guess I'm a little defensive at the moment because I know from experience when someone announces that they are leaving Spain all kinds of assumptions are made and they are often accused of failure etc etc. Not the case here obviously 

Going to the Town Hall this morning and being handed a bill for €1595 payable in 10 days has probably not helped my mood


----------



## mrypg9

Stravinsky said:


> Sorry for misunderstanding
> 
> I guess I'm a little defensive at the moment because I know from experience when someone announces that they are leaving Spain all kinds of assumptions are made and they are often accused of failure etc etc. Not the case here obviously
> 
> Going to the Town Hall this morning and being handed a bill for €1595 payable in 10 days has probably not helped my mood


Understandable..

Like the Captain, I wasn't referring to you. I have never met you, sad to say, but from your posts I've drawn the conclusion that you are by nature calm and level-headed.

It's just that a lot of people are running around like headless chickens which I don't think is necessary at this point...but who can tell..

Captain Billy...I thought your post was excellent. When we were in business we approached tax matters as does your son: you pay what you should. There aren't very many people who have that attitude these days, sad to say.

I'm still impressed by the way in which the Parliament and people of Cyprus defended their property.. Just goes to show that you don't mess with the bourgeoisie
It also shows something I've said when arguing with those on the far left: people have a great deal more to lose than their chains these days.


----------



## gus-lopez

Just thinking about it & in fact it is a lot more people than that. On another forum there are a few more who are basically selling up & departing. There are some who are now not going to relocate.
Personally if it affected me I wouldn't be here either. I certainly wouldn't be declaring using something that keeps throwing up security concerns every time you want to connect.


----------



## Stravinsky

Thank you Gus


----------



## gus-lopez

It is actually atrocious. Every government site is the same. Who wants to spend ages clicking on exemptions each time you need access ? Sometimes when the warning comes up it will not even ALLOW exemptions. So what do you do ? 
Digital signature ? Don't make me laugh.


----------



## Javea

*Rental Income*



snikpoh said:


> Firstly, the value of the property for you is £150k because that's when it passed to you. What someone else paid for it before you is irrelevant.
> 
> I would think that if you have rental income this year, then it will be on next year's income tax form. Similarly, if you inherited the house this year, then it will be on next years asset declaration otherwise, it will be in this years form covering 2012.


Rental income is declared in the UK as are royalties and pension if ou were a civil servant. Check it out with your gestor.


----------



## CapnBilly

Javea said:


> Rental income is declared in the UK as are royalties


....and are also both taxable in Spain, although you can offset any tax paid in the UK.


----------



## Editor

*Expats in Spain reminded of new tax reporting deadline*

Tax experts in Spain are reminding expats that under new rules they must inform the Spanish tax authorities of any assets they have outside the country including property and pensions. Expats have until the end of this month to report the information under new provisions in the General Tax Law which have been introduced as [...]

Click to read the full news article: Expats in Spain reminded of new tax reporting deadline...
Please come back to discuss the story here in this thread.


----------



## expatmat

It may be useful to clarify who this applies to i.e. tax residents or residencia holders and when the qualifier was (i.e. end of Dec 31 2012 or now).


----------



## xabiaxica

expatmat said:


> It may be useful to clarify who this applies to i.e. tax residents or residencia holders and when the qualifier was (i.e. end of Dec 31 2012 or now).


it applies to tax residents - I'm not sure but presumably those tax resident year ending Dec 31 2012 - since the tax year starts 1st Jan you wouldn't yet know for sure if you're tax resident for 2013 ...............

so anyone who spent 183+ days in Spain between Jan 1st 2012 & Dec 31st 2012


----------



## paul44

*More On Reporting Assets Worth More Than 50K*

Came across this interesting tit bit and as I mentioned in a different thread somewhere down the line there will be a new tax seems I'm not the only one who thinks that to be true.

Expats are the target of a new law on worldwide asset declaration « Spanish Property InsightSpanish Property Insight


could Spain be shooting themselves in the foot? I'm already one of those people who now have no intention of living full time in Spain just not worth it given the unknowns for the future


----------



## mrypg9

paul44 said:


> Came across this interesting tit bit and as I mentioned in a different thread somewhere down the line there will be a new tax seems I'm not the only one who thinks that to be true.
> 
> Expats are the target of a new law on worldwide asset declaration « Spanish Property InsightSpanish Property Insight
> 
> 
> could Spain be shooting themselves in the foot? I'm already one of those people who now have no intention of living full time in Spain just not worth it given the unknowns for the future


No,expats aka as immigrants are NOT the target. What tendentious rubbish!
The new requirement applies to ALL residents of Spain.
Why do these tacky little immigrant property companies try to create a 'them and us' situation?
Anyone who is resident in Spain and honest will already have declared any revenue obtained from these assets.
Bottom line: we immigrants came to Spain of our own free will. We use Spanish roads and other inf rastructure.
If we don't like the Spanish rules we are equally free to ****** off back to Tunbridge Wells or wherever.
The requirement is aimed at wealthy Spanish individuals and corporations.


----------



## mrypg9

The thought occurs to me that if Spain has to rely on mainly elderly and not exactly plutocratic British immigrants to keep it afloat,then times must be bad.:


----------



## 90199

Interesting article, more fiction than fact, no one yet knows why we have had to declare such assets.

By the time the authorities get round to imposing restrictions on such assets, I shall have instructed my financials advisor to re invest them to under €50,000 and any cash left over will be invested in none declarable assets.


----------



## paul44

mrypg9 said:


> No,expats aka as immigrants are NOT the target. What tendentious rubbish!
> The new requirement applies to ALL residents of Spain.
> Why do these tacky little immigrant property companies try to create a 'them and us' situation?
> Anyone who is resident in Spain and honest will already have declared any revenue obtained from these assets.
> Bottom line: we immigrants came to Spain of our own free will. We use Spanish roads and other inf rastructure.
> If we don't like the Spanish rules we are equally free to ****** off back to Tunbridge Wells or wherever.
> The requirement is aimed at wealthy Spanish individuals and corporations.


I wish I could share your optimistic view but unfortunately I think there is going to be another agenda sometime in the future.Even folks who are honest and above board as I am I might add will have a shock to the system and I'm not just talking about revenues from the assets, the assets themselves will become cash cows its not the revenues I would be worried about! the low figure of 50k is designed specifically to snare a bigger proportion of people, we have yearly property tax and we will also have a wealth tax the longer Spain's problems persist

I sound like the grim reaper!


----------



## baldilocks

Doesn't apply to me. I don't have anything worth anywhere near €50k


----------



## mrypg9

paul44 said:


> I wish I could share your optimistic view but unfortunately I think there is going to be another agenda sometime in the future.Even folks who are honest and above board as I am I might add will have a shock to the system and I'm not just talking about revenues from the assets, the assets themselves will become cash cows its not the revenues I would be worried about! the low figure of 50k is designed specifically to snare a bigger proportion of people, we have yearly property tax and we will also have a wealth tax the longer Spain's problems persist
> 
> I sound like the grim reaper!


But with respect,that is missing the point. Anyone tax resident in Spain is already required to furnish such information in the form of income derived from assets. I cannot think of an asset which does not provide income that could be taxed. I suppose one could have a house which is either empty or occupied by family members who pay no rent but it's hard to imagine what kind of tax Spanish Hacienda could impose on that kind of asset.
Most immigrants with assets over 50k€ will in any case have them invested and not in bank accounts - we certainly have.

We attended a Seminar whose purpose was to explain this new requirement. It became clear that some elderly immigrants were unnecessarily frightened - some didn't seem to grasp the difference between capital and revenue.

I asked the presenter whether this were merely a cross-referencing exercise. He agreed.

I cannot imagine how Hacienda could track down a non-revenue-producing asset in the UK if one chose not to reveal its existence. 
If the asset produces an income,it should already have been declared to Hacienda,as I said earlier.

Such reports are imo irresponsible and cause needless worry and concern.

We shall be reporting our assets in the UK and offshore as required and not losing sleep over it.


----------



## mrypg9

I wouldn't let this deter you from coming to Spain. Aafter all, if you think this could result in new taxes, then nowhere, even the UK, is safe, especially with the current bunch of incompetents in charge of the economy.


----------



## 90199

mrypg9 said:


> I wouldn't let this deter you from coming to Spain. Aafter all, if you think this could result in new taxes, then nowhere, even the UK, is safe, especially with the current bunch of incompetents in charge of the economy.


Or the next bunch that are even more incompetent, Bring back Harold from Huddersfield


----------



## WilliamS2013

Why are people so worried about the change? Surely if you have an asset worth over 50k you are likely already paying some kind of income tax on earnings from it correct? The Hacienda aren't actually going to lay some claim to that 50k are they?


----------



## 90199

WilliamS2013 said:


> Why are people so worried about the change? Surely if you have an asset worth over 50k you are likely already paying some kind of income tax on earnings from it correct? The Hacienda aren't actually going to lay some claim to that 50k are they?


Not necessarily, many investments you only pay tax if they mature with a profit, such as property, unit trusts, bonds etc. Premium bonds do not attract U.K. tax on the winnings. Fine wines and antiques only attract taxes on the profits from a sale.


----------



## mrypg9

WilliamS2013 said:


> Why are people so worried about the change? Surely if you have an asset worth over 50k you are likely already paying some kind of income tax on earnings from it correct? The Hacienda aren't actually going to lay some claim to that 50k are they?


Quite.


----------



## Lonely

Hepa said:


> will be invested in none declarable assets.


like what?


----------



## 90199

Lonely said:


> like what?


Well one simple example,

Property is only declarable if abroad and then only if the purchase price is over 50,000€.

There are others, but I employ an advisor to assist me in such decisions and if you have a shedload of dosh to invest, perhaps you should do the same.


----------



## WilliamS2013

WilliamS2013 said:


> Why are people so worried about the change? Surely if you have an asset worth over 50k you are likely already paying some kind of income tax on earnings from it correct? The Hacienda aren't actually going to lay some claim to that 50k are they?


Are you liking this comment because I am being really naive or because I raised a good point?


----------



## JaneyO

WilliamS2013 said:


> Why are people so worried about the change? Surely if you have an asset worth over 50k you are likely already paying some kind of income tax on earnings from it correct? The Hacienda aren't actually going to lay some claim to that 50k are they?


I think that is exactly what people are worried about!


----------



## Megsmum

wont have more than 50k so not worried still coming.. the ******s will get you where ever you are


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## mrypg9

JaneyO said:


> I think that is exactly what people are worried about!


How and by what mechanism can the SPanish tax authorities lay hands on tangible assets owned in the UK by British citizens?
Think it through.
Hacienda have enough trouble getting their hands on tax due from Spanish citizens living in Spain.

Stop worrying and get on with your lives...


----------



## gus-lopez

mrypg9 said:


> How and by what mechanism can the SPanish tax authorities lay hands on tangible assets owned in the UK by British citizens?
> Think it through.
> Hacienda have enough trouble getting their hands on tax due from Spanish citizens living in Spain.
> 
> Stop worrying and get on with your lives...


Quite simple. Under the new 'asset reporting' you have to supply full details, bank, address, Iban, Bic ,etc. This allows them , assuming that an offence, oversight, evasion, etc; has been committed, or assumed to have been committed, to embargo the account under Spanish law by applying for a European Court Order & enforcing it in the UK or whatever country the asset is in.

WillimS2013 does raise a good point in that even with an innocent oversight or lack of knowledge of an asset , there is no room for error. If it is not declared & found out not only will it be lost but you could end up paying an additional 50+% in fins etc. There is no appeal procedure. You are assumed to be a criminal. The fines are punitive & draconian.


----------



## samthemainman

Question on this - if I moved to Spain only last August, do I declare my inherited late mother's house this year or next year as I wasn't tax resident for last year under the 183 day rule?


----------



## IanB

mrypg9 said:


> How and by what mechanism can the SPanish tax authorities lay hands on tangible assets owned in the UK by British citizens?
> Think it through.
> Hacienda have enough trouble getting their hands on tax due from Spanish citizens living in Spain.
> 
> Stop worrying and get on with your lives...


May I just say that the worry is very real. It has been reported but not headline stuff that the tax authorities of numerous countries are are now party to an international treaty or treaties which allow the full interchange of information about assets and income overseas from the country of domicile. The reasoning behind these treaties was and has been given as giving the tax authorities of the country of domicile the full rights to take taxation from income and assets which in themselves reside overseas or offshore. Only this very weekend I had a serious discussion with a now retired barrister whose specialty was contract law. His statement on these issues was that he avoided the law of domicile as much as he could as this was the most difficult and complex area. His opinion was that it was a clear intention of the authorities to wipe out tax avoidance (where it suits), seize whatever they wanted across borders and the real losers in the end would be the little guy as always in these matters. To be honest we are having some difficulty in coming to terms with the potential for financial disaster with our planned move to Spain. By the way Spain is a full signatory to these arrangements. 

Much more is going on behind the scenes than we can imagine it would seem. For example the Isle of Man has just been dragged into the net by HMRC and "arrangements" put into place as have some of the Channel Islands.


----------



## mrypg9

gus-lopez said:


> Quite simple. Under the new 'asset reporting' you have to supply full details, bank, address, Iban, Bic ,etc. This allows them , assuming that an offence, oversight, evasion, etc; has been committed, or assumed to have been committed, to embargo the account under Spanish law by applying for a European Court Order & enforcing it in the UK or whatever country the asset is in.
> 
> WillimS2013 does raise a good point in that even with an innocent oversight or lack of knowledge of an asset , there is no room for error. If it is not declared & found out not only will it be lost but you could end up paying an additional 50+% in fins etc. There is no appeal procedure. You are assumed to be a criminal. The fines are punitive & draconian.


Assuming your assets are so vast that it' worthwhile for Hacienda to spend time and money on such a tortuous, long drawn-out process, that is.

I notice no-one has addressed my point about the fact that revenue-producing overseas assets should have been declared anyway and non-revenue producing assets over €50k would be virtually untraceable. What would anyone want to keep an asset of that amount in a non-revenue producing state for anyway?

Of course, immigrants who are resident in Spain and rent out their Uk properties but fail to declare such income either to HMRC or Hacienda might be a trifle concerned.
And rightly so.


----------



## Turtles

I am very concerned about this for a number of reasons. In no particular order: I can't vote in Spain - history shows that societies in economic trouble ALWAYS go after the foreigners, they want me to enter highly detailed information into a website that Google tells me is dangerous, parts of the form make no sense to us (I have advanced degrees in economics and finance and my Spanish wife is an economist), the rules were drawn up in a hurry and not explained, the penalties are ridiculous.


----------



## IanB

Of course, I am on your side over this mrypg9, and of course all income and assets should be decalred as you say. But since the Cyprus nonsense and the treaties now existing (new but in place at the time of the Cyprus crisis) has undermined everyone's trust in the systems. Any of the big evaders and avoiders will still be sharp enough to continue in their ways and to justify the efforts being put into this "interchange of information" it will be the soft targets like all of us little people who will be the losers. The figures quoted are politicians figures and could be lowered to 8500 euros or 85 euros tomorrow, who knows? Todays Costa Blanca News has Hollande and the Spanish Prime Minister stating that savings are "safe" now and Cyprus was a one off. The figures are sacred. As with all political statements, it is wise to exercise caution and assume that the exact opposite has already been planned.

We will just about reach the threshold if we sell the house and the business but add in the pensions (cash value) we saved and sacrificed for in earlier days as we are requird to do and we are stuffed. Also notable is the requirement to lump together our joint assets because we are married and in a stable relationship to bring us into the bracket. We cannot separate them it would seem from advice so far.


----------



## JaneyO

samthemainman said:


> Question on this - if I moved to Spain only last August, do I declare my inherited late mother's house this year or next year as I wasn't tax resident for last year under the 183 day rule?


 If you were not tax resident in Spain in the year ending 31/12/2012 I think you will have to declare it on next year's form which has to be done before the end of March 2013 not April a it is this year. You might want some way of proving you were not tax resident in 2012 though in case they start asking questions!


----------



## JaneyO

IanB said:


> Of course, I am on your side over this mrypg9, and of course all income and assets should be decalred as you say. But since the Cyprus nonsense and the treaties now existing (new but in place at the time of the Cyprus crisis) has undermined everyone's trust in the systems. Any of the big evaders and avoiders will still be sharp enough to continue in their ways and to justify the efforts being put into this "interchange of information" it will be the soft targets like all of us little people who will be the losers. The figures quoted are politicians figures and could be lowered to 8500 euros or 85 euros tomorrow, who knows? Todays Costa Blanca News has Hollande and the Spanish Prime Minister stating that savings are "safe" now and Cyprus was a one off. The figures are sacred. As with all political statements, it is wise to exercise caution and assume that the exact opposite has already been planned.
> 
> We will just about reach the threshold if we sell the house and the business but add in the pensions (cash value) we saved and sacrificed for in earlier days as we are requird to do and we are stuffed. Also notable is the requirement to lump together our joint assets because we are married and in a stable relationship to bring us into the bracket. We cannot separate them it would seem from advice so far.


I asked the gestor about this issue the other day, ie is it a joint return for married couples, he was very definite that it is an individual return. Who knows where the truth lies?


----------



## snikpoh

JaneyO said:


> I asked the gestor about this issue the other day, ie is it a joint return for married couples, he was very definite that it is an individual return. Who knows where the truth lies?


You are correct - it is an individual return BUT if the assets are held jointly, then the entire sum must be reported by EACH individual!

Sounds pretty dumb especially as there seems no way of declaring the percentages.


----------



## baldilocks

It's so nice to be poor!


----------



## 90199

mrypg9 said:


> I notice no-one has addressed my point about the fact that revenue-producing overseas assets should have been declared anyway and non-revenue producing assets over €50k would be virtually untraceable. What would anyone want to keep an asset of that amount in a non-revenue producing state for anyway?


Perhaps they do not have a choice, joint ownership of property with relatives or divorced partners for example.

Also bonds, unit trusts, other equities that do not produce immediate revenue until surrendered or sold, there are numerous.


----------



## Lonely

Hepa said:


> Well one simple example,
> 
> Property is only declarable if abroad and then only if the purchase price is over 50,000€.
> 
> There are others, but I employ an advisor to assist me in such decisions and if you have a shedload of dosh to invest, perhaps you should do the same.


:clap2: I am actually studying to become one here but I am not familiar with Spanish taxes yet.

So, local property under 50K doesn't need to be declared in Spain, interesting...is that value based on catastal / cadastral....whatever is called the land registry?

Thanks


----------



## Stravinsky

Lonely said:


> :clap2: I am actually studying to become one here but I am not familiar with Spanish taxes yet.
> 
> So, local property under 50K doesn't need to be declared in Spain, interesting...is that value based on catastal / cadastral....whatever is called the land registry?
> 
> Thanks



Your UK property? No it doesnt .... the value (last I heard) unbelievably is based on the purchase price of the property, i.e. what you bought it for.


----------



## expatmat

In 2 years time, we'll all be screaming "unfair" when Spain introduces windfall taxes on our estates. That and the bank account levy on the horizon.

Spain's asset declaration is like supplying the friendly neighborhood burglar with an inventory of what's in your house. Just for reference's sake of course!


----------



## 90199

Lonely said:


> :clap2: I am actually studying to become one here but I am not familiar with Spanish taxes yet.
> 
> So, local property under 50K doesn't need to be declared in Spain, interesting...is that value based on catastal / cadastral....whatever is called the land registry?
> 
> Thanks


No you have that wrong, property in Spain does not have to be declared on the overseas asset declaration. Property outside Spanish Territories, which was purchased for under 50,000€ does not have to be declared no matter what the present valuation is.


----------



## mrypg9

expatmat said:


> In 2 years time, we'll all be screaming "unfair" when Spain introduces windfall taxes on our estates. That and the bank account levy on the horizon.
> 
> Spain's asset declaration is like supplying the friendly neighborhood burglar with an inventory of what's in your house. Just for reference's sake of course!


What happened in Cyprus was related to bank deposits. Nothing else.

So...if you are worried about what might happen in Spain the remedy is simple: keep only a few €000 in your Spanish account and move all assets offshore.

Or stay in or return to the UK where your assets may also be subjected to being grabbed by a desperate government.
Or you could be run over,drown or be murdered...anywhere.


----------



## 90199

mrypg9 said:


> What happened in Cyprus was related to bank deposits. Nothing else.
> 
> So...if you are worried about what might happen in Spain the remedy is simple: keep only a few €000 in your Spanish account and move all assets offshore.
> 
> Or stay in or return to the UK where your assets may also be subjected to being grabbed by a desperate government.
> Or you could be run over,drown or be murdered...anywhere.


Why not drink the darned assets


----------



## baldilocks

mrypg9 said:


> Or stay in or return to the UK where your assets may also be subjected to being grabbed by a desperate government.


or a thieving bank/insurance company, Henry


----------



## chris&vicky

I assume this has something to do with identifying those liable for Wealth Tax. I do not consider myself to be wealthy but currently live in the south east of England where a modest house can be worth over £300,000. I plan to rent mine and move to Spain and really can't afford the added burden of a Wealth Tax. I have a private pension pot with around £350,000 plus some other savings. Surely this is not going to make me liable for tax? I have always been prudent to save for a pension and buy a house, maybe I should have just spent everything and lived off the state?


----------



## expatmat

chris&vicky said:


> I assume this has something to do with identifying those liable for Wealth Tax. I do not consider myself to be wealthy but currently live in the south east of England where a modest house can be worth over £300,000. I plan to rent mine and move to Spain and really can't afford the added burden of a Wealth Tax. I have a private pension pot with around £350,000 plus some other savings. Surely this is not going to make me liable for tax? I have always been prudent to save for a pension and buy a house, maybe I should have just spent everything and lived off the state?


Based on these figures, you're under the _current_ wealth tax threshold in Spain anyway.

The point is what happens next. It's pretty obvious the asset declaration exercise isn't about housekeeping and is clearing the path for future fiscal policy. 

Those with liquid assets need to transfer everything but their living expenses to jurisdictions with limited TIEAs with Spain. Those with fixed assets need to sit and hope or GTFO.


----------



## chris&vicky

expatmat said:


> Those with liquid assets need to transfer everything but their living expenses to jurisdictions with limited TIEAs with Spain. Those with fixed assets need to sit and hope or GTFO.


Like where?


----------



## Stravinsky

mrypg9 said:


> What happened in Cyprus was related to bank deposits. Nothing else.
> 
> So...if you are worried about what might happen in Spain the remedy is simple: keep only a few €000 in your Spanish account and move all assets offshore.
> 
> Or stay in or return to the UK where your assets may also be subjected to being grabbed by a desperate government.
> Or you could be run over,drown or be murdered...anywhere.


You keep saying that Mary! 

Many people don't keep any money in Spain. They keep it in the UK. They are happy to pay the taxes that they anticipated when they moved here and didnt see the need to "move offshore". They pay their taxes here and they do things by the book. Its not their fault that the Spanish Government are doing what they are doing, but whatever you say ... its going to have an effect. Ive seen a number of people just on the forums saying that they are re considering their plans. Ive heard a number of people in the area here saying the same. And thats only in my little world 

So its all well and good saying if you don't like it then sod off to the UK, but some people cant.

That property link that you put down the other day .... did you actually read it and see that some of the comments were by a Spanish Financial expert.

OK, its your opinion that this wont affect expats and I appreciate that ..... but at the end of the day you cant get away from the fact that they are farming our personal financial details in another country, and to many peoples minds there can be only one reason for that in the long term. Yes, it affects Spanish Nationals as you rightly say, and I hope you are right that it will only be Spanish nationals .... but the people who will ultimately own most assets outside of Spain will more often than not be those that came here from other countries and they will not want to risk their assets being whittled away by a desperate Spanish Government in years to come.


----------



## gus-lopez

mrypg9 said:


> Assuming your assets are so vast that it' worthwhile for Hacienda to spend time and money on such a tortuous, long drawn-out process, that is.


One inadvertently undeclared 50k account is worth 75 k to the Hacienda.

this is made up of A) 10k euro fine
B)The 50k account is treated as a capital gain in that tax year & is subject to tax at 52% = 26k euros.
C) the fine for non-declaration is 150% of the tax = 39K 

So every non declared asset , for whatever reason, is worth half as much again to the Hacienda. These are the minimum penalties. Imagine if you , or even worse the assessor you are paying to do the job, inadvertently failed to declare a 3 or 400,000 pension pot. You could be bankrupted !! 

Best way is ; 
Err on the side of caution. Declare everything. Can't be wrong 

then can you ? If you are thinking of doing something declare that as well. 

Better to declare something that doesn't exist, but might , rather than 

things that do exist but might not be included. Remember the penalty is for
" non-declaration" not " Declaration of things that don't exist ! "
Throw some confusion in, as well as sleeping soundly, knowing that you have 

not left anything out.


Quote:

" I notice no-one has addressed my point about the fact that revenue-producing overseas assets should have been declared anyway and non-revenue producing assets over €50k would be virtually untraceable. What would anyone want to keep an asset of that amount in a non-revenue producing state for anyway? "

Quite correct that the income should have been reported , & rightly so. Apart from a general outline of where it comes from that is all they need to know. Certainly not full bank acct. details numbers , etc. 

To answer the last part of the above paragraph, I do & always have done. In the UK , & still do, & here in Spain. I do not agree with unearned interest nor any form of income that is not obtained by working. Took a while for the bank manager to get his head around that one ! 
I know it is ridiculous, stupid even & has obviously cost me & my family large amounts of money but I've always worked on the principle that if you need money you work & if you need even more you work longer. That's why I don't agree with any benefits.


----------



## 90199

chris&vicky said:


> I assume this has something to do with identifying those liable for Wealth Tax. I do not consider myself to be wealthy but currently live in the south east of England where a modest house can be worth over £300,000. I plan to rent mine and move to Spain and really can't afford the added burden of a Wealth Tax. I have a private pension pot with around £350,000 plus some other savings. Surely this is not going to make me liable for tax? I have always been prudent to save for a pension and buy a house, maybe I should have just spent everything and lived off the state?


It is not what your house is worth now, but what you originally paid for it. 

I have an interest in a detached property in the U.K. which I bought for the equivalent of 4000€ in 1973, must be worth at least 100,000 Pounds now, but I do not have to declare it because the purchase price was under 50,000€.

More legislation that has not been very well planned or researched.


----------



## Lonely

Hepa said:


> No you have that wrong, property in Spain does not have to be declared on the overseas asset declaration. Property outside Spanish Territories, which was purchased for under 50,000€ does not have to be declared no matter what the present valuation is.


ah okay...so the next question is: how in this world the Spanish Gov. will know transaction prices all over the world.


----------



## Lonely

Hepa said:


> It is not what your house is worth now, but what you originally paid for it.
> 
> I have an interest in a detached property in the U.K. which I bought for the equivalent of 4000€ in 1973, must be worth at least 100,000 Pounds now, but I do not have to declare it because the purchase price was under 50,000€.
> 
> More legislation that has not been very well planned or researched.


unfreakingbelievable.


----------



## Stravinsky

Hepa said:


> It is not what your house is worth now, but what you originally paid for it.
> 
> I have an interest in a detached property in the U.K. which I bought for the equivalent of 4000€ in 1973, must be worth at least 100,000 Pounds now, but I do not have to declare it because the purchase price was under 50,000€.
> 
> More legislation that has not been very well planned or researched.


Yes, but you WILL have to declare it next year because its value will have risen substantially over the initial valuation placed on it. I wonder how the Spanish authorities will come to terms with a valuation increase of £96k, and how will you be able to value it accurately anyway!


----------



## Stravinsky

Lonely said:


> ah okay...so the next question is: how in this world the Spanish Gov. will know transaction prices all over the world.


They dont

How can you put an accurate valuation on a house anywhere, when its worth only what someone will pay for it. As I just said, how will they deal with the increases in value over the original valuation given


----------



## jimenato

It might be that the house only has to be declared if it was over 50k when you bought it I have just been told (today) by a gestor/asesor who got it direct from hacienda that the value to be declared is the current value of the house.


----------



## chris&vicky

Hepa said:


> It is not what your house is worth now, but what you originally paid for it.
> 
> I have an interest in a detached property in the U.K. which I bought for the equivalent of 4000€ in 1973, must be worth at least 100,000 Pounds now, but I do not have to declare it because the purchase price was under 50,000€.
> 
> More legislation that has not been very well planned or researched.


Not very fair. Mine is probably worth less now than what I paid for it!


----------



## Stravinsky

jimenato said:


> It might be that the house only has to be declared if it was over 50k when you bought it I have just been told (today) by a gestor/asesor who got it direct from hacienda that the value to be declared is the current value of the house.


Its a complete balls up because one person says one thing, and another says something different. My gestor had a written document from the Hacienda which stated acquisition value!!!


----------



## expatmat

Lonely said:


> ah okay...so the next question is: how in this world the Spanish Gov. will know transaction prices all over the world.


They won't but that's like saying "how will the Spanish govt know what assets I have?" 
99% of what they know will be willingly volunteered by scared expats


----------



## expatmat

This law is not going to work. How is Spain going to get away with jailing that expat who failed to declare 1 rental property or 1 pension in the UK (based on the criminal conviction level of 120k euros)? 

Seriously, how will this work in practice as I can assure you there will be more than 1 expat who "forgets"?


----------



## JaneyO

baldilocks said:


> It's so nice to be poor!


Good for you-and if you're not poor already I am sure the Hacienda will be able to arrange it in due course!


----------



## 90199

Lonely said:


> ah okay...so the next question is: how in this world the Spanish Gov. will know transaction prices all over the world.


Cannot comment on world records, but in the U.K. there are many sites like the one below, all you need is a postal code.

House prices, Land Registry property prices paid - Zoopla


----------



## mrypg9

expatmat said:


> Based on these figures, you're under the _current_ wealth tax threshold in Spain anyway.
> 
> The point is what happens next. It's pretty obvious the asset declaration exercise isn't about housekeeping and is clearing the path for future fiscal policy.
> 
> Those with liquid assets need to transfer everything but their living expenses to jurisdictions with limited TIEAs with Spain. Those with fixed assets need to sit and hope or GTFO.


Why is it obvious?

Everyone seems to be forgetting that you should alrea dy have declared taxa.ble assets.


----------



## mrypg9

expatmat said:


> In 2 years time, we'll all be screaming "unfair" when Spain introduces windfall taxes on our estates. That and the bank account levy on the horizon.
> 
> Spain's asset declaration is like supplying the friendly neighborhood burglar with an inventory of what's in your house. Just for reference's sake of course!


Again,this is wild supposition for which there is no evidence.

I.'ll bet Spaniards aren't running around like headless chickens..and yes, many middle-class Spaniards do have overseas assets.


----------



## Turtles

mrypg9 said:


> Everyone seems to be forgetting that you should alrea dy have declared taxa.ble assets.


I have already declared income from abroad. My account numbers and balances are my own personal business - until now.


----------



## expatmat

mrypg9 said:


> Why is it obvious?


Boy, we have a lot of work to do.


----------



## Stravinsky

mrypg9 said:


> Again,this is wild supposition for which there is no evidence.
> 
> I.'ll bet Spaniards aren't running around like headless chickens..and yes, many middle-class Spaniards do have overseas assets.


Well you ignored my last post 
Wheres your evidence that this isnt a tax collating exercise then? 

Many middle class Spanish might well have assets abroad, but its going to be the expat that is more likely to have more value assets abroad


----------



## mrypg9

Stravinsky said:


> Well you ignored my last post
> Wheres your evidence that this isnt a tax collating exercise then?


Because you will have already declared your taxable assets. You haven't explained the mechanism that could enable Hacienda to place a levy on UK assets - or offshore assets. To do so would require legal permission from a UK Court and the UK Government would strenuously oppose any such application from a foreign tax authority.
How exactly would the money be collected if such a levy were imposed on property or investments held in funds if you had very little money on deposit in Spanish or Uk banks?
UK Fund Managers cannot be compelled to supply details of asset holders by a foreign tax authority. Offshore Fund Managers certainly can't.
We have funds well over the reporting amount in UK and offshore investments and we're not losing a wink of sleep over it all, Strav. 
Mind you, OH's name begins with W


----------



## Stravinsky

mrypg9 said:


> Because you will have already declared your taxable assets. You haven't explained the mechanism that could enable Hacienda to place a levy on UK assets - or offshore assets. To do so would require legal permission from a UK Court and the UK Government would strenuously oppose any such application from a foreign tax authority.
> How exactly would the money be collected if such a levy were imposed on property or investments held in funds if you had very little money on deposit in Spanish or Uk banks?
> UK Fund Managers cannot be compelled to supply details of asset holders by a foreign tax authority. Offshore Fund Managers certainly can't.
> We have funds well over the reporting amount in UK and offshore investments and we're not losing a wink of sleep over it all, Strav.
> Mind you, OH's name begins with W


I dont think I have suggested they will remove money from my accounts in the UK, but as a Spanish property owner they have the ability to levy a tax against me in Spain for any foreign assets, remove it from my bank account here, and place charge against my property. They have the ability to choose what rate, and to introduce new taxes they deem necessary. 

Uk fund managers arent being compelled to supply details of investments .... we, the asset holders are, at threat of huge fines if we don't provide all details. These fines of course will be levied in Spain and therefore foreign (or Spanish) property owners are right up there.

I'm glad you are not losing sleep, I really am .... but I perceive that you are putting a lot of trust in an "organisation" that has the ability to do what they feel is necessary in the face of extreme financial crisis. I truly hope its based on more than advice received at a conference that you attended, because financial experts, and gestors are all quite alarmed at the prospect of what has happened


----------



## chris&vicky

Stravinsky said:


> I dont think I have suggested they will remove money from my accounts in the UK, but as a Spanish property owner they have the ability to levy a tax against me in Spain for any foreign assets, remove it from my bank account here, and place charge against my property. They have the ability to choose what rate, and to introduce new taxes they deem necessary.
> 
> Uk fund managers arent being compelled to supply details of investments .... we, the asset holders are, at threat of huge fines if we don't provide all details. These fines of course will be levied in Spain and therefore foreign (or Spanish) property owners are right up there.
> 
> I'm glad you are not losing sleep, I really am .... but I perceive that you are putting a lot of trust in an "organisation" that has the ability to do what they feel is necessary in the face of extreme financial crisis. I truly hope its based on more than advice received at a conference that you attended, because financial experts, and gestors are all quite alarmed at the prospect of what has happened


Hey chill out !


----------



## Stravinsky

chris&vicky said:


> Hey chill out !


Hey, I'm having a discussion with someone I enjoy having a discussion with
I _am_ chilled out, but_ you_ wouldnt know that


----------



## expatmat

If you're not losing sleep about this you either have no assets of worth, live by the seat of your pants or don't have a clue as to what's really going on (or d - all of the above!!) This Spanish Domesday project is the precursor for a wealth transfer on an epic scale.


----------



## Stravinsky

expatmat said:


> If you're not losing sleep about this you either have no assets of worth, live by the seat of your pants or don't have a clue as to what's really going on (or d - all of the above!!) This Spanish Domesday project is the precursor for a wealth transfer on an epic scale.


Careful now, or you'll be told to chill out


----------



## expatmat

Stravinsky said:


> Careful now, or you'll be told to chill out


I just be taking some more or them medZzz


----------



## skip o

My family has been working towards a retirement in Spain for a year and a half now. The actions of Spain and Cyprus have put the brakes on it though.

I have seen people mention that the UK could do the money grab like Cyprus, but I can guarantee that the US won't do such a thing in my lifetime. No wealth tax will happen either.


----------



## expatmat

skip o said:


> My family has been working towards a retirement in Spain for a year and a half now. The actions of Spain and Cyprus have put the brakes on it though.
> 
> I have seen people mention that the UK could do the money grab like Cyprus, but I can guarantee that the US won't do such a thing in my lifetime. No wealth tax will happen either.


Dude the US is one of only 2 countries in the world that taxes according to citizenship not residence. It's the most [email protected]@@ed tax system in the world (or maybe the 2nd if you include the other one which was Burundi or Angola or somewhere like that)


----------



## baldilocks

Stravinsky said:


> I _am_ chilled out, but_ you_ wouldnt know that


Chilled? I am bl**dy freezing, but you wouldn't know that either, so that's why I'm telling you!


----------



## mrypg9

expatmat said:


> If you're not losing sleep about this you either have no assets of worth, live by the seat of your pants or don't have a clue as to what's really going on (or d - all of the above!!) This Spanish Domesday project is the precursor for a wealth transfer on an epic scale.


We have assets well into six figures. Neither you nor I 'have a clue as to what's really going on'. Your view is as much supposition as mine but mine is based on objective evaluation of what has happened, what could happen and what MIGHT happen.

Fact: Hacienda already have the information needed to impose a further levy on assets,should they so wish, if one has been honest in reporting. Getting hold of further information such as account details could easily be done....assuming the UK Government was willing to override data protection law and allow its citizens' domestic assets to be the plaything of a foreign tax authority,an unlikely scenario.
Fact: the asset grab in Cyprus applied to accounts held in Cyprus by residents of Cyprus. It did not apply to all bank holdings and not at all to other assets.
Fact: this new reporting requirement applies to all: Spaniards,Brits, Dutch, German, Russian...and I'm betting there are more wealthy Russians than Brits. The Spanish Government could be tied up for years,decades even in international litigation if it attempted to grab these assets in any way.

Your view is merely an opinion,as is mine,but mine is based on more solid ground than yours which to me seems mere scare-mongering,a form of mental masochism. 

There is another fact: if your view is correct then you have grounds for trepidation as there is no country in the world where your assets are safe from a wealth tax,certainly not the UK.....such assets would in fact be less safe if you are a UK citizen.

Our comfortable life in Spain is based on assets built up over years by prudent and calculated risk-taking.e


----------



## mrypg9

To add to the above: if you have scant liquidity in a Spanish or UK bank....how could this wealth tax be applied?

Are you suggesting that a foreign government could liquidate assets such as property or shares,gilts,bank deposits etc. held by a national of another state in that or any other state?
Have you considered the reaction of the markets and the effect on bond yields if any state decided on such a course of action?
These things don't happen in isolation. They would provoke an international crisis of confidence.
Try looking at the bigger picture. The old adage that 'travel broadens the mind' is clearly not universally applicable


----------



## expatmat

ok rant over


----------



## Turtles

mrypg9 said:


> Are you suggesting that a foreign government could liquidate assets such as property or shares,gilts,bank deposits etc. held by a national of another state in that or any other state?


You keep missing the point that they don't need to. The Spanish government could just present you with a tax bill. To pay it then YOU would need to liquidate your foreign assets. As is the case with demands for inheritance tax here, no account would be taken of the illiquidity of the assets.


----------



## mrypg9

expatmat said:


> ok rant over


Who's 'ranting'? You defintion of rant is a tad strange

Maybe Baroness Carmen von Thyssen-Bornemisza,who is resident in Spain and who holds multi-million euro and dollar accounts in the British Virgin Island tax haven. Her hithertofore secret assets have now been revealed,along with those of other wealthy Russian,Bulgarian and other tax dodgers resident in Spain.

If the Spanish authorities want to grab assets, i think the likes of you and I will be very low on their priority list.


----------



## mrypg9

Turtles said:


> You keep missing the point that they don't need to. The Spanish government could just present you with a tax bill. To pay it then YOU would need to liquidate your foreign assets. As is the case with demands for inheritance tax here, no account would be taken of the illiquidity of the assets.


Think that through. You refuse to pay...and you wouldn't be the only one. What do they do then? Jail you?
Get real. Liquidate your assets....what if they can't be so easily rendered into cash?

You haven't considered the other points I've made,such as international reaction. 
Such cross-border asset grabs can't be done as simply as you imagine.

All this is based on supposition and if the result is to deter would- be immigrants from coming to Spain, it is sad. Most of us will continue to enjoy our life in Spain.
I am currently in the UK, having attended a Conference here. It is bitterly cold,wet and windy,flurries of snow yesterday and I am looking forward to flying home later today.
Speculation and needless scaremongering won't spoil my life,especially now summer is approaching.

Strav, I hope you will continue posting in exile....


----------



## jimenato

All the Spanish government needs to do to get its money is attach a lien to your Spanish property. They do it frequently and also with cars. 

Of course if you don't own a Spanish property...


----------



## Pesky Wesky

1. The Spanish government has little interest in jailing people over tax fraud. What they want is the money, so they will fine people as much as possible.
2. The technology to chase people up on this may exist, but I doubt if they have the man power. The law may be passed, but to what extent will they (legally) be able to follow up on it?
3. Some of us don't have this kind of money in the UK, but it's not because we are "living by the seat of our pants" as one poster put it.


----------



## mrypg9

Pesky Wesky said:


> 1. The Spanish government has little interest in jailing people over tax fraud. What they want is the money, so they will fine people as much as possible.
> 2. The technology to chase people up on this may exist, but I doubt if they have the man power. The law may be passed, but to what extent will they (legally) be able to follow up on it?
> 3. Some of us don't have this kind of money in the UK, but it's not because we are "living by the seat of our pants" as one poster put it.


Agreed. OH hs sizeable but not multi- millionaire level UK and offshore assets. Neither of us has Spanish property and we don't keep much cash in our Spanish accounts.

You have grasped the main points in few words- unlike me- which is that it's easy to pass laws, much much harder to enforce them.


----------



## baldilocks

mrypg9 said:


> If the Spanish authorities want to grab assets, i think the likes of you and I will be very low on their priority list.


On the contrary, as always, it will be those who can least afford it who will be penalised first simply because they offer the path of least resistance and and can least afford to fight or put such assets beyond the reach of the authorities. It will merely echo the disastrous Spanish fiscal policies of the 15th, 16th and 17th centuries where all the tax burden was borne by the poor because the rich had arranged provisions through their cronie in government to ensure that they were excused taxes. (sounds awfully like Britain inthe 21st century.)


----------



## mrypg9

baldilocks said:


> On the contrary, as always, it will be those who can least afford it who will be penalised first simply because they offer the path of least resistance and and can least afford to fight or put such assets beyond the reach of the authorities. It will merely echo the disastrous Spanish fiscal policies of the 15th, 16th and 17th centuries where all the tax burden was borne by the poor because the rich had arranged provisions through their cronie in government to ensure that they were excused taxes. (sounds awfully like Britain inthe 21st century.)


Worms turn....


----------



## baldilocks

mrypg9 said:


> Worms turn....


I know and they cause terrible indigestion!


----------



## Stravinsky

mrypg9 said:


> We have assets well into six figures. Neither you nor I 'have a clue as to what's really going on'. Your view is as much supposition as mine but mine is based on objective evaluation of what has happened, what could happen and what MIGHT happen.


Exactly Mary, we _do_ agree then!!!

The difference in the direction to take though is that making the declaration is irrevocable. They then have the details to act with should they so wish. By _not _making the declaration then there is no margin for future taxation in Spain.

As I've said, the ONLY way I can see to be safe and protect the hard earned capital of a working life is to limit time in Spain to avoid being a tax resident.

I know its different (at the moment), but I watched an interview with a poor expat in Cyprus who had trusted the system and moved all his life savings to Cyprus, only to see it raided by the government there. It was such a shame for him, and seemingly with no warning. 

At the end of the day I think we can all agree that the whole thing is badly thought out


----------



## mrypg9

Stravinsky said:


> Exactly Mary, we _do_ agree then!!!
> 
> The difference in the direction to take though is that making the declaration is irrevocable. They then have the details to act with should they so wish. By _not _making the declaration then there is no margin for future taxation in Spain.
> 
> As I've said, the ONLY way I can see to be safe and protect the hard earned capital of a working life is to limit time in Spain to avoid being a tax resident.
> 
> I know its different (at the moment), but I watched an interview with a poor expat in Cyprus who had trusted the system and moved all his life savings to Cyprus, only to see it raided by the government there. It was such a shame for him, and seemingly with no warning.
> 
> At the end of the day I think we can all agree that the whole thing is badly thought out



Indeed! And yes, wealth and stealth taxes can be imposed anywhere and anytime.

Imo what happened in Cyprus was indefensible. Surely the levy could have been restricted to a Number One haircut on the funds of the Russian and other speculators?

Blanket sequestration is imo morally indefensible.

Bank deposits per se do not reflect an individual's true wealth.


----------



## IanB

Wow you guys are quick on your feet. However despite the apparent difficulty in seizing assets abroad from the place of residence, e.g. tax resident in Spain with assets say in the UK, there now exist these bilateral and multi national treaties and agreements of full co-operation between the tax authorities of signatory nations. Your affairs are already well known to HMRC in the UK (are not your Building society accounts, bank accounts and private pension plans already taxed at source). That renders UK expats and the expats of all other signatory nations, living where ever, the most vulnerable and easy soft targets to raise money from very quickly. An example, son in Oz is going through divorce. Whilst he declared all his pension assets here in the UK, the authorities in Oz already had those details to hand and used them to check that his declarations were truthful. Oz is yet to sign up and implement in full yet the details of his affairs had been released under the terms of those agreements.

As we have said it will be the little guy in the street who pays in the end for all of this, it won't be the real tax evaders.


----------



## Stravinsky

IanB said:


> Wow you guys are quick on your feet. However despite the apparent difficulty in seizing assets abroad from the place of residence, e.g. tax resident in Spain with assets say in the UK, there now exist these bilateral and multi national treaties and agreements of full co-operation between the tax authorities of signatory nations. Your affairs are already well known to HMRC in the UK *(are not your Building society accounts, bank accounts and private pension plans already taxed at source). *That renders UK expats and the expats of all other signatory nations, living where ever, the most vulnerable and easy soft targets to raise money from very quickly. An example, son in Oz is going through divorce. Whilst he declared all his pension assets here in the UK, the authorities in Oz already had those details to hand and used them to check that his declarations were truthful. Oz is yet to sign up and implement in full yet the details of his affairs had been released under the terms of those agreements.
> 
> As we have said it will be the little guy in the street who pays in the end for all of this, it won't be the real tax evaders.


I'd agree with most of what you say ... but no, private pensions, bank and building society accounts are not taxed at source if the correct procedures are followed. They should have been declared in Spain, however some fall under the taxable income figure required to put a Spanish return in up to now and I'm guessing have therefore not been declared anywhere.

Big investment and bank figures dont necessarily mean big incomes in this day and age unfortunately. In real terms our "pot" is worth less now than it was when we moved here even including income we have taken out


----------



## IanB

Yes Strav. I would agree in principle and there are differing figures of declaration, but two points which may have been overlooked. Firstly all pensions in the UK are taxable as income subject to tax allowances including state pension. Tax cannot be deducted from the state pension because of the way the regulations are worded and DWP do not have the means anyway to make the deductions at the moment. However under self assessment all private pensions are taxed at source at the current rate of 20% and it is only when the return is filed will the final calculation take place and you either receive a bill or a refund. So my point is really they already know about your affairs in detail and are obliged under the treaty to share that or any other information with say the Spanish Hacienda.

Second point is the declaration of CEV (cash equivalent value) of pension funds as a capital asset/savings. I questioned my own providers and was told by a compliance manager that yes they had in place all the necessary procedures to calculate and provide signatory nations with the information that they may request without further reference to me or anyone else. I did not sign my original contract with them with those clauses in it (infringing the Data Protection Act 1998) nor have I granted my EXPRESS permission under that Act. For tax purposes that has already been over ridden.

So as you have said previously its all in the lap of the gods really and at the whim of the nation you choose to reside in. Like I said this situation is on the "con" side of the balance sheet not the "pro" side of our planned move to Spain and my OH as an accountant is very nervous of it all. Badly planned badly thought out badly implemented legislation which not only Spain on these tax issues.


----------



## Stravinsky

IanB said:


> Yes Strav. I would agree in principle and there are differing figures of declaration, but two points which may have been overlooked. Firstly all pensions in the UK are taxable as income subject to tax allowances including state pension. Tax cannot be deducted from the state pension because of the way the regulations are worded and DWP do not have the means anyway to make the deductions at the moment. However under self assessment all private pensions are taxed at source at the current rate of 20% and it is only when the return is filed will the final calculation take place and you either receive a bill or a refund. So my point is really they already know about your affairs in detail and are obliged under the treaty to share that or any other information with say the Spanish Hacienda.


Hmm, interesting

Well, as we know *Government pensions* are always taxed in the UK and although the theory is to declare it here as well, most gestors will tell you not to bother
*State Pensions *can be zerod in the UK and taxed here
*Private Pensions*, I was always told that the same applied as for state pensions ... but if what you say is true then if I was going to stay tax resident in Spain that would suit me down to the ground, as I would have state, private and government and could use both allowances again


----------



## JaneyO

expatmat said:


> They won't but that's like saying "how will the Spanish govt know what assets I have?"
> 99% of what they know will be willingly volunteered by scared expats


Scared is the word, because of the horrendous penalties. I've just made an appointment with the gestor to do this declaration and I am having panic attacks! Given all the conflicting information 'direct from the Hacienda' how can I even be sure my gestor will fill the form in correctly, I'm not in a position to check what he's done. Guess he won't be paying the fines if it is wrong. Then there's 'scared' about so much detail about personal affairs being 'out there' if I was a hacker I would be rubbing my hands together in glee. Think I will move the assets into different accounts or investments so if the hackers go looking they won't find anything left! Then there's'scared' about what will ultimately happen like a windfall tax. I don't have that much over the limit but when you've planned your retirement on the basis of what you have - and have earned- you don't want the rug pulled out from under. I think it's the feeling of helplessness that is so stressful, yes I know if you can't do anything about it why worry but that's easier said than done. The financial advisor told me to just do it and then forget it, the gestor thought I would be mad to do it! Think I might take the advice above and just drink the assets!


----------



## skip o

expatmat said:


> Dude the US is one of only 2 countries in the world that taxes according to citizenship not residence. It's the most [email protected]@@ed tax system in the world (or maybe the 2nd if you include the other one which was Burundi or Angola or somewhere like that)


As someone who started off living below the poverty level, and is now able to retire at age 40, I can assure you that taxes in the US are too low, if anything. I am looking for a country to retire where my family will inject a lot of money into their economy. But I can't do it if there is the potential for cash grabs, haircuts and ever-increasing wealth taxes. It is looking like we may just stay in the US, where none of that will ever happen because the US populace is ridiculously anti-tax.

Now, the US health system is the most [email protected]@@ed in the world, but that is another story.


----------



## baldilocks

skip o said:


> As someone who started off living below the poverty level, and is now able to retire at age 40, I can assure you that taxes in the US are too low, if anything. I am looking for a country to retire where my family will inject a lot of money into their economy. But I can't do it if there is the potential for cash grabs, haircuts and ever-increasing wealth taxes. It is looking like we may just stay in the US, where none of that will ever happen because the US populace is ridiculously anti-tax.
> 
> Now, the US health system is the most [email protected]@@ed in the world, but that is another story.


To improve the US health system you have to increase taxes and stop the Republicans supporting the US arms industry by trying to make war everywhere and get rid of the CIA who are the biggest troublemakers in the world


----------



## gus-lopez

baldilocks said:


> On the contrary, as always, it will be those who can least afford it who will be penalised first simply because they offer the path of least resistance and and can least afford to fight or put such assets beyond the reach of the authorities. It will merely echo the disastrous Spanish fiscal policies of the 15th, 16th and 17th centuries where all the tax burden was borne by the poor because the rich had arranged provisions through their cronie in government to ensure that they were excused taxes. (sounds awfully like Britain inthe 21st century.)


& exactly what they have done & are doing with the 'Ley de La Costa? . Picking on the little ones , whether they be foreigners or Spaniards whilst leaving most of the big fish alone.


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## gus-lopez

Came across this earlier. Surprised Strav or Xabiachica hadn't posted it . 
At least it shows that some Spaniards are as concerned about it as the foreigners !

BESEIGED EXPATS fighting Spain’s draconian new asset declaration law have found allies in Costa Blanca town halls.
04 April 2013 @ 17:49

Local politicians fear their expat residents will be driven away by the controversial legislation and new immigrants choose other countries for a new home in the sun – hitting the fragile economies along the coast.

And town halls are worried that the legislation, which demands the declaration of overseas assets worth more than 50,000€, is ill conceived and has already spread “havoc and panic” in their communities.

Passed by Royal Decree last November, the rules require Spaniards and expats classed as fiscal residents to make a declaration by 30th April or face prohibitive penalties that could exceed the value of any undisclosed holdings.

Expats facing being caught up in Madrid’s trawl through the country have already branded the law “the new Spanish Inquisition” and believe the declaration is a forerunner for new taxes or levies in a “money grab” by the recession hit state.

Enter a White Knight. Oscar Anton is Deputy Mayor of Javea and its councillor for Finance. Supported by other town halls he is calling on Madrid to rethink its new law.

The leader of Xabia Democratica – a political party supported by a large number of expats in the Marina Alta town – he has organised two meeting with finance experts, the second was last night (Thursday) to help explain the declaration rules.

TARGET

However, Mr Anton believes the asset declaration exercise is missing its intended target – Spanish citizens moving money abroad to avoid taxes – and instead hitting foreign residents keen to abide by the rules.
“People living here and paying taxes must declare assets over 50,000€. Why? Because the government is not thinking of the expats but the Spaniards sending money out of Spain,” he said.

“Madrid wants to know how much is going to Switzerland or Germany or wherever. But what has happened? In this area and mainly in places where there are large numbers of expats facing this situation of having to declare everything. They are already paying their income taxes.

“I want to present a motion explaining to Madrid that they don’t realise what they have done to the expat – the spirit of the law was for the Spanish not foreign residents.”

Mr Anton said the declaration did not mean new taxation but added: “Everyone is in a panic because of the economic situation (in Spain) and this kind of thing does not help.”

He said he would underline the importance of expats to local economies and how much money they brought into the country.

QUESTION

“I want to say to Madrid that we are not happy about the law and the government must limit things because in future people will not choose Spain to make a new home because the state will be asking you a lot of questions,” said the politician.

“People are coming here to retire and relax or to work – they pay their taxes, we do not want more taxes from them because they spend their money in our shops, restaurants and bars and for our services. It is wrong to get to these people.”

Meanwhile the fight back by worried expats against the directive continues to gather pace with a ‘manifesto’ being prepared to show the extent of fears in the foreign community.

A petition is also being urgently being prepared for Brussels raising important questions with the European Parliament regarding legitimacy of the declaration process under European Union law and complaints have also sent to the European Commission – with the possibility of a challenge in the European court of Justice.

Part of the draft manifesto states: “We are now becoming increasingly concerned that we are being targeted under the terms of recent anti-fraud and asset declaration laws being forced to reveal in great detail sensitive personal information and data tom others including authorities with no guarantees that this information will not be used in a tax or asset grab to follow from the declaration or to conduct detailed reassessments of past tax returns.

“We are further concerned about the disproportionate penalties for even minor reporting errors, when these derive from information provided under different reporting systems and are passed via third parties in a form few of us understand.”

Source: RTN


----------



## Pesky Wesky

baldilocks said:


> On the contrary, as always, it will be those who can least afford it who will be penalised first simply because they offer the path of least resistance and and can least afford to fight or put such assets beyond the reach of the authorities.


Have to agree with this. You only have to look around you to see that's true.


----------



## JaneyO

gus-lopez said:


> Came across this earlier. Surprised Strav or Xabiachica hadn't posted it .
> At least it shows that some Spaniards are as concerned about it as the foreigners !
> 
> BESEIGED EXPATS fighting Spain’s draconian new asset declaration law have found allies in Costa Blanca town halls.
> 04 April 2013 @ 17:49
> 
> Local politicians fear their expat residents will be driven away by the controversial legislation and new immigrants choose other countries for a new home in the sun – hitting the fragile economies along the coast.
> 
> And town halls are worried that the legislation, which demands the declaration of overseas assets worth more than 50,000€, is ill conceived and has already spread “havoc and panic” in their communities.
> 
> Passed by Royal Decree last November, the rules require Spaniards and expats classed as fiscal residents to make a declaration by 30th April or face prohibitive penalties that could exceed the value of any undisclosed holdings.
> 
> Expats facing being caught up in Madrid’s trawl through the country have already branded the law “the new Spanish Inquisition” and believe the declaration is a forerunner for new taxes or levies in a “money grab” by the recession hit state.
> 
> Enter a White Knight. Oscar Anton is Deputy Mayor of Javea and its councillor for Finance. Supported by other town halls he is calling on Madrid to rethink its new law.
> 
> The leader of Xabia Democratica – a political party supported by a large number of expats in the Marina Alta town – he has organised two meeting with finance experts, the second was last night (Thursday) to help explain the declaration rules.
> 
> TARGET
> 
> However, Mr Anton believes the asset declaration exercise is missing its intended target – Spanish citizens moving money abroad to avoid taxes – and instead hitting foreign residents keen to abide by the rules.
> “People living here and paying taxes must declare assets over 50,000€. Why? Because the government is not thinking of the expats but the Spaniards sending money out of Spain,” he said.
> 
> “Madrid wants to know how much is going to Switzerland or Germany or wherever. But what has happened? In this area and mainly in places where there are large numbers of expats facing this situation of having to declare everything. They are already paying their income taxes.
> 
> “I want to present a motion explaining to Madrid that they don’t realise what they have done to the expat – the spirit of the law was for the Spanish not foreign residents.”
> 
> Mr Anton said the declaration did not mean new taxation but added: “Everyone is in a panic because of the economic situation (in Spain) and this kind of thing does not help.”
> 
> He said he would underline the importance of expats to local economies and how much money they brought into the country.
> 
> QUESTION
> 
> “I want to say to Madrid that we are not happy about the law and the government must limit things because in future people will not choose Spain to make a new home because the state will be asking you a lot of questions,” said the politician.
> 
> “People are coming here to retire and relax or to work – they pay their taxes, we do not want more taxes from them because they spend their money in our shops, restaurants and bars and for our services. It is wrong to get to these people.”
> 
> Meanwhile the fight back by worried expats against the directive continues to gather pace with a ‘manifesto’ being prepared to show the extent of fears in the foreign community.
> 
> A petition is also being urgently being prepared for Brussels raising important questions with the European Parliament regarding legitimacy of the declaration process under European Union law and complaints have also sent to the European Commission – with the possibility of a challenge in the European court of Justice.
> 
> Part of the draft manifesto states: “We are now becoming increasingly concerned that we are being targeted under the terms of recent anti-fraud and asset declaration laws being forced to reveal in great detail sensitive personal information and data tom others including authorities with no guarantees that this information will not be used in a tax or asset grab to follow from the declaration or to conduct detailed reassessments of past tax returns.
> 
> “We are further concerned about the disproportionate penalties for even minor reporting errors, when these derive from information provided under different reporting systems and are passed via third parties in a form few of us understand.”
> 
> Source: RTN


Well good for them, about time somebody put up a fight. Sadly it's a bit late, as the deadline is 30th April this year, not next. Maybe it will help by damage limitation in future. How do we join the campaign if that's what it's going to be- I for one will sign up!


----------



## IanB

Stravinsky said:


> Hmm, interesting
> 
> Well, as we know *Government pensions* are always taxed in the UK and although the theory is to declare it here as well, most gestors will tell you not to bother
> *State Pensions *can be zerod in the UK and taxed here
> *Private Pensions*, I was always told that the same applied as for state pensions ... but if what you say is true then if I was going to stay tax resident in Spain that would suit me down to the ground, as I would have state, private and government and could use both allowances again


This is interesting Strav. What you say is correct but I know all of our private pensions and bank interest here is taxed at source at 20%. When we enter our self assessment return there is usually a refund. By the way I took my private plans a couple of years early and only came onto State pension this year, continuing some work in the business in between. ( Glad I did with annuities going the way they have).

However your comments on tax residency in Spain are a little surprising. I looked at all the figures available, tax rates, allowances etc. etc. and we came to the conclusion that we would on INCOME pay significantly more tax in Spain. This would be offset by lower taxation elsewhere and slightly lower cost of living for general expenses leaving us about 10% - 15% better off, a healthier climate and lifestyle which would assist with my health problems. This assumes that I could get the disability allowance on the lower scale as well although there seem to be no guidelines on how this might be achieved. Our amateur findings were reinforced by professional advice.

Then we have this asset reporting issue on top which suggests to many that a potential raid on all assets and savings may well be a probability. Our concern is that our assets will be over the threshold and the CEV of the pension funds will also be taken as assets/savings/capital to be thrown into the pot. It all seems be a bit like the HMRC assessors when investigating estates here counting the shirt buttons of the deceased to get the estate into inheritance tax territory if you understand what I am trying to get at.

regards


----------



## mrypg9

JaneyO said:


> Scared is the word, because of the horrendous penalties. I've just made an appointment with the gestor to do this declaration and I am having panic attacks! Given all the conflicting information 'direct from the Hacienda' how can I even be sure my gestor will fill the form in correctly, I'm not in a position to check what he's done. Guess he won't be paying the fines if it is wrong. Then there's 'scared' about so much detail about personal affairs being 'out there' if I was a hacker I would be rubbing my hands together in glee. Think I will move the assets into different accounts or investments so if the hackers go looking they won't find anything left! Then there's'scared' about what will ultimately happen like a windfall tax. I don't have that much over the limit but when you've planned your retirement on the basis of what you have - and have earned- you don't want the rug pulled out from under. I think it's the feeling of helplessness that is so stressful, yes I know if you can't do anything about it why worry but that's easier said than done. The financial advisor told me to just do it and then forget it, the gestor thought I would be mad to do it! Think I might take the advice above and just drink the assets!


I think it is sad that the way this new measure has been reported has caused you to feel that way. Imo it is totally unnecessary. I don't think we have lost a moment's sleep over it and neither shall we. It's interesting that 'old-timers' like Pesky have a more relaxed approach to it all, no doubt from long experience of Spanish laws and bureaucracy. I've only been in Spain for five years but between us OH and I have lived in or spent long periods of time in seven very different countries. We therefore have had considerable experience of 'abroad' and although that doesn't make us the fount of all knowledge it has taught us quite a lot about how systems work. Generally, the more 'assimilated' you are, the more you tend not to press the panic button. Note I said 'Generally'. 

I think many immigrants feel insecure and unsafe if they spreak no Spanish and have little contact with Spain outside their immigrant communities. I'm guessing that it's mainly those immigrants who are worrying about this and not people like Xavia and Pesky.

Of course I'm not putting you in that or indeed any category - I don't know you - and for all I know you could have been resident in Spain for years and speak fluent Spanish.

I'm just sorry you feel as you do because I don't and I really think there's no need.
We shall report as required, truthfully fill in our tax reports and enjoy life.

Incidentally....what about immigrants who arrive on May 1st? What are their obligations?

We have a lot 'over the limit'. Ourvery pleasant lifestyle is based on that too.


----------



## baldilocks

Mary - so good, you said it twice!!


----------



## mrypg9

baldilocks said:


> Mary - so good, you said it twice!!


Sorry, Mods please delete.
Got back from UK late last night..


----------



## Stravinsky

mrypg9;1116733[B said:


> Generally, the more 'assimilated' you are, the more you tend not to press the panic button. Note I said 'Generally'.
> 
> I think many immigrants feel insecure and unsafe if they spreak no Spanish and have little contact with Spain outside their immigrant communities. I'm guessing that it's mainly those immigrants who are worrying about this and not people like Xavia and Pesky.
> [/B]


Well that doesnt describe me, and neither have I pressed a panic button.
Ive simply looked at the situation, taken advice from people who really know the system, and applied the risk factor to me.

Incidentally Mary the financial worlds are far different now to what we have experienced over past years. the banking crisis saw to that and previous "systems" may no longer apply 

And maybe, just maybe, some people of those who aren't cconcerned simply dont have anything to worry about because they dont have anything to lose.


----------



## JaneyO

Stravinsky said:


> Well that doesnt describe me, and neither have I pressed a panic button.
> Ive simply looked at the situation, taken advice from people who really know the system, and applied the risk factor to me.
> 
> Incidentally Mary the financial worlds are far different now to what we have experienced over past years. the banking crisis saw to that and previous "systems" may no longer apply
> 
> And maybe, just maybe, some people of those who aren't cconcerned simply dont have anything to worry about because they dont have anything to lose.


Thanks for the words of comfort, hope you are right and in 12 months time we'll all be wondering what the fuss was about. (Though they may well have thought of some other money making scheme to exercise us by then!) No, I don't live in an expat 'community' there are very few Brits around here, and, yes I do speak Spanish, up to a point. My son in law is Spanish and he was completely horrified about what we are being asked to do, he was convinced it was a scam until he looked it up online!


----------



## baldilocks

Stravinsky said:


> And maybe, just maybe, some people of those who aren't cconcerned simply dont have anything to worry about because they dont have anything to lose.


That's me. As I said before - I'm glad I'm poor. We have lost too much in that past and have inherited nothing. All we have is what we've built up since our financial disasters (yes, even been bankrupt!) and most of that is tied up in our modest house in Spain.


----------



## Stravinsky

JaneyO said:


> T*hanks for the words of comfort, hope you are right and in 12 months time we'll all be wondering what the fuss was about.* (Though they may well have thought of some other money making scheme to exercise us by then!) No, I don't live in an expat 'community' there are very few Brits around here, and, yes I do speak Spanish, up to a point. My son in law is Spanish and he was completely horrified about what we are being asked to do, he was convinced it was a scam until he looked it up online!


I think you misunderstood my post.

Although I also hope that no one gets stung by this the advice and thoughts of many others are to the contrary

Whichever, I'm doing what is best for me and my circumstances


----------



## chris&vicky

Stravinsky said:


> I think you misunderstood my post.
> 
> Although I also hope that no one gets stung by this the advice and thoughts of many others are to the contrary
> 
> Whichever, I'm doing what is best for me and my circumstances


Stop worrying about your money, live your life!


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## Stravinsky

chris&vicky said:


> Stop worrying about your money, live your life!


Oh good ... firstly chill out and now stop worrying about your money

As you know absolutely nothing about my situation and why I am doing what I am doing I would ask you to mind your own business and stop trying to make smart comments which dont really contribute to our discussion.

Thank you


----------



## chris&vicky

Stravinsky said:


> Oh good ... firstly chill out and now stop worrying about your money
> 
> As you know absolutely nothing about my situation and why I am doing what I am doing I would ask you to mind your own business and stop trying to make smart comments which dont really contribute to our discussion.
> 
> Thank you


You are posting on a public noticeboard? I am just worried about your health. You will worry yourself sick. It's really not worth it. Enjoy the sunshine, or move back to the snow in the UK.


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## Stravinsky

chris&vicky said:


> You are posting on a public noticeboard? I am just worried about your health. You will worry yourself sick. It's really not worth it. Enjoy the sunshine, or move back to the snow in the UK.


Please dont try and troll me, I've seen it too many times and I am not affected

Just so you are clear
I'm not at all worried, I have the facilities to do what I want, when I want and I really dont need your advice thanks.

Yes, its a public noticeboard where we are discussing a particular subject. It's not about me, its about the subject so please allow the thread to continue without pointless comment

Thank you


----------



## chris&vicky

Stravinsky said:


> Please dont try and troll me, I've seen it too many times and I am not affected
> 
> Just so you are clear
> I'm not at all worried, I have the facilities to do what I want, when I want and I really dont need your advice thanks.
> 
> Yes, its a public noticeboard where we are discussing a particular subject. It's not about me, its about the subject so please allow the thread to continue without pointless comment
> 
> Thank you


Ok no problem


----------



## mrypg9

Stravinsky said:


> Well that doesnt describe me, and neither have I pressed a panic button.
> Ive simply looked at the situation, taken advice from people who really know the system, and applied the risk factor to me.
> 
> Incidentally Mary the financial worlds are far different now to what we have experienced over past years. the banking crisis saw to that and previous "systems" may no longer apply
> 
> And maybe, just maybe, some people of those who aren't cconcerned simply dont have anything to worry about because they dont have anything to lose.


No, I don't think you are panicking, Strav. Like you, we've taken advice, thought about it and come to different conclusions.
Only time will tell who is right.

Interesting point about banking systems. My dil who has a very senior executive post with RBS -I don't hold it against her, but I do let her know that she is now a public servant - told me that RBS and presumably other institutions have in place systems to enable a smooth transition for any country which leaves the eurozone and reverts to its former or some other currency. These systems have been in place for quite a while.

Not that she's an expert in international tax laws although she works with people who are...but she thought it highly unlikely that the UK would allow a foreign Government to interfere in any way with assets held in the UK by UK non -dom nationals. If such were the case, the international financial system would end in anarchy and chaos since in theory any government world-wide could have a lien on residents' overseas assets which would trigger a huge crisis of confidence as no-one could be sure of the inviolability of their overseas holdings. The existing tax and reporting arrangements were put in place by international agreement and bear no relation to anything Hacienda could contemplate doing.


----------



## GallineraGirl

*More help needed with the new Asset Law.*

We have been told that we have to declare the value of our pensions for the new law ( except for state pensions). If you have a personal pension, you know what the value of the annuity was that you have had invested to provide you with the pension but if you have an occupational final salary pension you are not told what the amount invested, on your behalf is, to provide your pension. We have heard that there is a formula that can be used by gestors to calculate a value for your pension 'pot' using your current age and what you receive in pension payments. Our Gestor has no knowledge of this. Can anyone tell us what this formula is, or where to find it, so that we can complete our asset declaration as, at present, we do not know whether our pensions are worth over 50,000€.

Also, what is the situation regarding government pensions e.g. Teacher,, Police etc. which can only be taxed in England and include a lump sum when paid. Should these be declared as an asset? And what if you will have a pension in the future but are not taking it yet. Should that be declared as an asset too?

Any help in answering these questions would be gratefully received and may prevent further sleepless nights.


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## IanB

mrypg9 said:


> No, I don't think you are panicking, Strav. Like you, we've taken advice, thought about it and come to different conclusions.
> Only time will tell who is right.
> 
> Interesting point about banking systems. My dil who has a very senior executive post with RBS -I don't hold it against her, but I do let her know that she is now a public servant - told me that RBS and presumably other institutions have in place systems to enable a smooth transition for any country which leaves the eurozone and reverts to its former or some other currency. These systems have been in place for quite a while.
> 
> Not that she's an expert in international tax laws although she works with people who are...but she thought it highly unlikely that the UK would allow a foreign Government to interfere in any way with assets held in the UK by UK non -dom nationals. If such were the case, the international financial system would end in anarchy and chaos since in theory any government world-wide could have a lien on residents' overseas assets which would trigger a huge crisis of confidence as no-one could be sure of the inviolability of their overseas holdings. The existing tax and reporting arrangements were put in place by international agreement and bear no relation to anything Hacienda could contemplate doing.


Oh No they don't have plans for a "sterling zone" do they? LOL. Heaven help us with the likes of RBS et al involved.

However on the last paragraph, I think many would disagree with that comment about the UK government allowing or not allowing assets and the like to be raided by other countries. The news is rife with what the EU has told the UK to do and not to do on many many subjects (the toadies to Brussels will just do as they are told). Cameron has already spouted to the world that he is on a mission to stamp out tax evasion campaigning on behalf of many nations H'mmmmmm. These treaties make it one hell of a lot easier to attack anyone, (soft targets first). Today a UK official has admitted for example that they don't know how many migrants from Romania and Bulgaria are lining up to come here and because of the EU directives we are powerless to stop them ( not at all true). In fact most EU countries except the UK and Republic of Ireland have already imposed conditions and quotas in some form or other. A couple of weeks ago the EU had apparently instructed our NHS that they MUST treat all citizens who arrive for any illness totally free of charge from DAY ONE! Our own doctor is really mad about the instructions she has received from the Department all under the guise of EU instruction. On these two counts alone just look at the hoops we have go through to legitimise our residency in Spain. It has all been discussed at length on these very boards.

On the issue of confidence in the international monetary system. Does anyone believe anything they say or have any confidence at all in its principles ethics or its fundamental ability to tell even remotely the truth? Those days are very long gone. This very day 3 senior bankers ( HBoS) have been accused really of gross negligence (i.e in my book cheating and lying) and a Parliamentary Committee has asked the regulators to ban these three crooks from ever working in the financial sector again. LIBOR scandals, PPI scandals Icelandic scandals.Wow bankers really have a long way to go to restore any trust in their bent dealings again. We have never learned the lessons of history when Joseph Kennedy and a few of his mates treated the system as their own private casino and ruined hundreds of thousands of people's lives in the early part of last century and the odious Thatcher embroils this fine nation of ours in yet another legacy of economic weakness exacerbated by every single political leader since. There has only been one good decision to come out this latest lot since 1979 and that was to keep Britain out of the euro.

rant rant rant rant this really gets me going.

regards


----------



## paul44

Christ I didn't expect my original post to generate so much discussion! but then again perhaps that's good I have weighed up what I know and being a particularly careful person who always suspects the worst won't be plotting up full time in Spain as I had planned. I also suspect there will be loads more like me thinking along the same lines .


----------



## chris&vicky

paul44 said:


> Christ I didn't expect my original post to generate so much discussion! but then again perhaps that's good I have weighed up what I know and being a particularly careful person who always suspects the worst won't be plotting up full time in Spain as I had planned. I also suspect there will be loads more like me thinking along the same lines .


Well I think it is a shame that you have been put off by all the scaremongering and all the doom-mongers. Maybe you should independently examine the facts over time.


----------



## IanB

Hi Paul,

We are very much in the same boat as yourself now. We were all set on a programme to get ourselves to Spain permanently despite a number of difficulties and obstacles. This should have come to fruition second quarter next year. My OH is an accountant anyway so we have spent a lot of time examining the figures in great detail and all the circumstances surrounding taxation, bureaucracy, health care in particular and as I said despite very patchy information and responses we were still hell bent on making the dream work. I have even started studying Spanish for the second time around. However after seeking proper professional advice including the consular service the position is so fluid that we have put our holiday plans on hold for this year and will book if at all at the very last minute. It was even said by the professionals that under no circumstances should I risk with the problems I have coming to Spain and hoping that I would be able to join the Health care service over there. Its not going to happen apparently and would probably take at least 8 months to wade though the procedures with the very real possibility of being refused the necessary "residencia". I therefore need additional private insurance which with heart failure and arthritis is going to cost about £188 per week for the holiday and any permanent type move some £400 per month. This is for the minimum cover suggested by the consulate. I have a relation out there who is longstanding (over 16 years now) and his enthusiasm for Spain is seriously infectious and always has been, yet even he is suggesting caution at the moment and to give breathing space with a lot of serious thought before committing.

There are here on this forum conflicting views and that is good as they can all be plugged into your proposed model for getting the move under way or not as the case may prove. With the potential for probable financial disaster leaving no room for a return the scales this week for us have slammed firmly down on the don't do it side. I have even got the medics to agree a clearance so I am travelling and moving with their full approval, (Doc is a Spanish speaker so I now have to at least make the effort to address her in Spanish LOL). No-one could be more disappointed than we are right at this moment but they say hope springs eternal so we will wait and see how things begin to pan out.

regards
Ian


----------



## mrypg9

IanB said:


> Hi Paul,
> 
> We are very much in the same boat as yourself now. We were all set on a programme to get ourselves to Spain permanently despite a number of difficulties and obstacles. This should have come to fruition second quarter next year. My OH is an accountant anyway so we have spent a lot of time examining the figures in great detail and all the circumstances surrounding taxation, bureaucracy, health care in particular and as I said despite very patchy information and responses we were still hell bent on making the dream work. I have even started studying Spanish for the second time around. However after seeking proper professional advice including the consular service the position is so fluid that we have put our holiday plans on hold for this year and will book if at all at the very last minute. It was even said by the professionals that under no circumstances should I risk with the problems I have coming to Spain and hoping that I would be able to join the Health care service over there. Its not going to happen apparently and would probably take at least 8 months to wade though the procedures with the very real possibility of being refused the necessary "residencia". I therefore need additional private insurance which with heart failure and arthritis is going to cost about £188 per week for the holiday and any permanent type move some £400 per month. This is for the minimum cover suggested by the consulate. I have a relation out there who is longstanding (over 16 years now) and his enthusiasm for Spain is seriously infectious and always has been, yet even he is suggesting caution at the moment and to give breathing space with a lot of serious thought before committing.
> 
> There are here on this forum conflicting views and that is good as they can all be plugged into your proposed model for getting the move under way or not as the case may prove. With the potential for probable financial disaster leaving no room for a return the scales this week for us have slammed firmly down on the don't do it side. I have even got the medics to agree a clearance so I am travelling and moving with their full approval, (Doc is a Spanish speaker so I now have to at least make the effort to address her in Spanish LOL). No-one could be more disappointed than we are right at this moment but they say hope springs eternal so we will wait and see how things begin to pan out.
> 
> regards
> Ian


But Ian, if you are of retirement age, it shouldn't take so long to transfer your health care from the NHS to the Spanish system. It took an hour of waiting at the Seg. Soc. office before I was gven my number. I made an appointment with my local GP the next week.
Of course things may have changed with the new requirements. 

I too have arthritis and recently discovered heart problems - I'm off to the hospital next week to see the cardiologist. The care I have been given here has been faultless. It was only through a routine check-up that my blocked artery problem and other such problems were discovered. I thought I was 100% fit and healthy, apart from the odd touch of arthritis now and then!

I can only repeat that it would be very sad for someone who really wishes to live in Spain and has the means to do so to be deterred by a lot of 'What ifs?'


----------



## paul44

I think caution is the byword here as I haven't moved I have no worries and that's how it is going to be, it's a real shame because I would have certainly liked to have moved full time but simply don't trust the system not to use the collected info in the future to screw more dosh out of what has been already taxed properly.

I'll just take long holidays and I'm out for a month in 3 weeks and I have several other visits planned this year but nothing that is going to make me have to register
with anyone.

Ah well better safe than sorry and I really do hope it turns out to be something and nothing but who can tell these days!!!!


----------



## mrypg9

Chris and Vicky.....sorry, I can't resist asking...

Your names aren't by any chance Huhne and Price......

Nah, didn't think so!

Have a nice weekend,all of you,

Mary


----------



## chris&vicky

mrypg9 said:


> Chris and Vicky.....sorry, I can't resist asking...
> 
> Your names aren't by any chance Huhne and Price......
> 
> Nah, didn't think so!
> 
> Have a nice weekend,all of you,
> 
> Mary


How did you guess that?


----------



## Pesky Wesky

mrypg9 said:


> I think it is sad that the way this new measure has been reported has caused you to feel that way. Imo it is totally unnecessary. I don't think we have lost a moment's sleep over it and neither shall we. It's interesting that 'old-timers' like Pesky have a more relaxed approach to it all, no doubt from long experience of Spanish laws and bureaucracy.


The reason I'm so relaxed as you put it is because, as I said before, I have no money anywhere else but Spain.  Actually that doesn't make me feel very relaxed atm, but although I don't feel that the money I have is entirely safe here, I don't think taking money out of the country is good for me nor the economics of the country.
It has to be said I don't have a lot anyway, partly because I've never earned a lot and partly because neither OH nor I are interested in investing and playing the markets. We purposely put money into areas that are not damaging, and that means we don't make as much as we we could, but that's our decision. And of course that means that we have what we deem to be "enough".
I have to say, I'm glad I'm just good old middle class, and I mean middle not upper middle. Enough to live on and not enough to worry about. Leaves my limited brain capacity room to think about other things 
BTW, IMHO, I can't see how this new legislation can be applied...


----------



## Stravinsky

chris&vicky said:


> Well I think it is a shame that you have been put off by all the scaremongering and all the doom-mongers. Maybe you should independently examine the facts over time.


Like I did you mean 



Pesky Wesky said:


> The reason I'm so relaxed as you put it is because, as I said before, I have no money anywhere else but Spain.  Actually that doesn't make me feel very relaxed atm, but although I don't feel that the money I have is entirely safe here, I don't think taking money out of the country is good for me nor the economics of the country.
> It has to be said I don't have a lot anyway, partly because I've never earned a lot and partly because neither OH nor I are interested in investing and playing the markets. We purposely put money into areas that are not damaging, and that means we don't make as much as we we could, but that's our decision. And of course that means that we have what we deem to be "enough".
> I have to say, I'm glad I'm just good old middle class, and I mean middle not upper middle. Enough to live on and not enough to worry about. Leaves my limited brain capacity room to think about other things
> BTW, IMHO, I can't see how this new legislation can be applied...


I agree with what you say
People make choices. People will still come to Spain despite what may or may not happen. The point is that its a personal choice based on the research they do and as long as the research is factually based then thats good.

I also agree that forums are places for personal opinions but I dont think it should be described as scaremongering ..... As you intimate though, diffierent people will have different views based on their asset values.

Who knows, it may be another year 2000 computer crash scenario, i.e it never happens, but I dont think people should dismiss it so easily.

Thats my final word on the subject because although all I was engaging in was healthy debate, some have obviously come to the conclusion for some reason that it is making me ill, which couldnt be further than the truth  I hope it all works out well for everyone in the long run :fingerscrossed:


----------



## Pesky Wesky

Stravinsky said:


> Like I did you mean
> 
> 
> 
> I agree with what you say
> People make choices. People will still come to Spain despite what may or may not happen. The point is that its a personal choice based on the research they do and as long as the research is factually based then thats good.
> 
> I also agree that forums are places for personal opinions but I dont think it should be described as scaremongering ..... As you intimate though, diffierent people will have different views based on their asset values.
> 
> Who knows, it may be another year 2000 computer crash scenario, i.e it never happens, but I dont think people should dismiss it so easily.
> 
> Thats my final word on the subject because although all I was engaging in was healthy debate, some have obviously come to the conclusion for some reason that it is making me ill, which couldnt be further than the truth  I hope it all works out well for everyone in the long run :fingerscrossed:


Stravinsky,
you rarely get so involved in a debate. You have a lot of information on the subject and have your own personal views. If I were you, I'd simply ignore the posts that are misreading your comments and carry on enjoying yourself.


----------



## IanB

mrypg9 said:


> But Ian, if you are of retirement age, it shouldn't take so long to transfer your health care from the NHS to the Spanish system. It took an hour of waiting at the Seg. Soc. office before I was gven my number. I made an appointment with my local GP the next week.
> Of course things may have changed with the new requirements.
> 
> I too have arthritis and recently discovered heart problems - I'm off to the hospital next week to see the cardiologist. The care I have been given here has been faultless. It was only through a routine check-up that my blocked artery problem and other such problems were discovered. I thought I was 100% fit and healthy, apart from the odd touch of arthritis now and then!
> 
> I can only repeat that it would be very sad for someone who really wishes to live in Spain and has the means to do so to be deterred by a lot of 'What ifs?'


Thank you for your comments and the comments of others. Yes we are of retirement age with all the business to dissolve properly and a house to sell here and all of our serious savings in our private pensions. I have studied all of the S1 material, talked to DWP which included the annual capitation fee paid to Spain (£3500 per annum each at the time of discussion, now others are saying it has risen to £4200 per annum), asked UKinSpain a raft of questions and so on and so forth., taken part here as you have seen, read myself into a stupor at times. Yet all are able to quote the rules but then there are the conflicting reports whereby some autonomous regions are refusing to accept EU citizens domiciled in Spain who have the correct paperwork. I have a number of reports and forum posts of people trying to do the right thing and it taking up to 7 months to even get the procedures started. The detail we have examined is quite minute even down to me checking whether the drugs regime prescribed for me here is even available there, how much it costs and a detailed examination of my contribution to it. Even that turned out to be a mixed response of ifs buts and maybes , it depends where you live, it might cost you a maximum of 8 euros a month (official UkinSpain), it might cost you 10% of the full cost of the medicine, the pharmacia might charge you the full amount at the counter and you might be able to reclaim later and apparently from an official source pay in full for medical needs until such times as Spain deigns to grant me a residencia. This in itself is uncertain as I have notes of a number of cases whereby the terms and conditions proof of income, level of savings and the like are moved by the local authorities and not granted to UK pensioners. I can't even buy a car there to get around until------ Yet we have persevered. And officially NONE of this can happen until I have made my first tax return which cannot be until 183 days minimum have passed

Now we have the very subject of this thread coupled with the actions by the EU in Cyprus. I am in no way suggesting that this is solely aimed at British expats its going to be everyone if it happens and the worst hit will be those who can least afford a raid on their savings. We are not rich at all but with the sale of the house here, CEVs on pension pots, disposal of assets from the business and recovery of our directors loan accounts (in credit) from that leads to us being into the interim territory, no where near wealth tax (would be nice) but with assets which even if divided puts us each into the over 50,000 bracket which may or may not have to be combined and declared in full by both of us. All of which we were prepared to move to Spain with us. Nothing fancy , minimum hassle, nothing clever.

Its a total mess and at our time of life there is no going back, there is no recovery route if it all goes wrong. The dream is not dead totally, we will just exercise more caution than we normally do and wait to see what happens.

regards
Ian


----------



## chris&vicky

IanB said:


> Its a total mess and at our time of life there is no going back, there is no recovery route if it all goes wrong. The dream is not dead totally, we will just exercise more caution than we normally do and wait to see what happens.
> 
> regards
> Ian


Why is there no going back? You could do what I am doing, rent out your UK house, mine more than covers renting a lovely Villa in Spain. Then if you want to go back you can. Time will tell what will happen. Most people posting here have their opinions, but nobody really knows. I have put my move off for so many years, there is always a reason to put it off. But if you want to do it, try it first. Good luck.


----------



## baldilocks

IanB said:


> Its a total mess and at our time of life there is no going back, there is no recovery route if it all goes wrong. The dream is not dead totally, we will just exercise more caution than we normally do and wait to see what happens.
> 
> regards
> Ian


Your complete post is relevant but it wasn't necessary to quote in its entirety.

You are taking the correct approach with regard to researching, it is just unfortunate that so much is in a state of flux at the moment and, because central government is not being very co-operative about laying down clear criteria and providing proper support to the autonomous communities, the latter are having to make up the rules as they go along which means inconsistencies developing - The Catalans are, I believe, saying you only pay a maximum of €8 or €10, whereas, here in this part of Andalucía, we pay 10%, etc.

Just keep researching. Eventually you will come to one of three decisions:
To go to Spain, to stay home or to defer the dedcision until things are a little clearer. Irrespective of what we say or can suggest, that decision is yours alone.

We all made our decisions in the past. For most of us regulars and long-term members of these forums, it was the right decision. For those who made the wrong decision, most of them have gone back or elsewhere and who is to say whether they should have given more consideration to things or been better prepared or should never have considered moving in the first place?


----------



## xabiaxica

IanB said:


> Thank you for your comments and the comments of others. Yes we are of retirement age with all the business to dissolve properly and a house to sell here and all of our serious savings in our private pensions. I have studied all of the S1 material, talked to DWP which included the annual capitation fee paid to Spain (£3500 per annum each at the time of discussion, now others are saying it has risen to £4200 per annum), asked UKinSpain a raft of questions and so on and so forth., taken part here as you have seen, read myself into a stupor at times. Yet all are able to quote the rules but then there are the conflicting reports whereby some autonomous regions are refusing to accept EU citizens domiciled in Spain who have the correct paperwork. I have a number of reports and forum posts of people trying to do the right thing and it taking up to 7 months to even get the procedures started. The detail we have examined is quite minute even down to me checking whether the drugs regime prescribed for me here is even available there, how much it costs and a detailed examination of my contribution to it. Even that turned out to be a mixed response of ifs buts and maybes , it depends where you live, it might cost you a maximum of 8 euros a month (official UkinSpain), it might cost you 10% of the full cost of the medicine, the pharmacia might charge you the full amount at the counter and you might be able to reclaim later and apparently from an official source pay in full for medical needs until such times as Spain deigns to grant me a residencia. This in itself is uncertain as I have notes of a number of cases whereby the terms and conditions proof of income, level of savings and the like are moved by the local authorities and not granted to UK pensioners. I can't even buy a car there to get around until------ Yet we have persevered. And officially NONE of this can happen until I have made my first tax return which cannot be until 183 days minimum have passed
> 
> Now we have the very subject of this thread coupled with the actions by the EU in Cyprus. I am in no way suggesting that this is solely aimed at British expats its going to be everyone if it happens and the worst hit will be those who can least afford a raid on their savings. We are not rich at all but with the sale of the house here, CEVs on pension pots, disposal of assets from the business and recovery of our directors loan accounts (in credit) from that leads to us being into the interim territory, no where near wealth tax (would be nice) but with assets which even if divided puts us each into the over 50,000 bracket which may or may not have to be combined and declared in full by both of us. All of which we were prepared to move to Spain with us. Nothing fancy , minimum hassle, nothing clever.
> 
> Its a total mess and at our time of life there is no going back, there is no recovery route if it all goes wrong. The dream is not dead totally, we will just exercise more caution than we normally do and wait to see what happens.
> 
> regards
> Ian



the only people I have heard of having problems are a few who 'fell through the cracks' under the old rules - like snikpoh & his family

I've not heard of a single case of pensioners with S1s not gaining immediate access to healthcare once registered as resident

everyone in Spain pays towards their prescriptions - it's 10% of the full cost for pensioners & yes, there is a max payable unless you're pretty rich (I have the figure somewhere but istr that it's an income of 100,000€ pa)- the onus is upon you to prove that you're not, however

Spain doesn't 'deign to grant you residencia' - you have the right to reside here - all you are doing is registering & it takes minutes - if you have your pension paid into a Spanish bank account & the S1s they can't refuse you 


as I often say to my students.....you're over-thinking this......


----------



## mrypg9

chris&vicky said:


> Why is there no going back? You could do what I am doing, rent out your UK house, mine more than covers renting a lovely Villa in Spain. Then if you want to go back you can. Time will tell what will happen. Most people posting here have their opinions, but nobody really knows. I have put my move off for so many years, there is always a reason to put it off. But if you want to do it, try it first. Good luck.


That's exactly what we did. Rented our UK house, sold the business, found a big posh house 5 miles from Prague city centre, vast landscaped gardens, inground covered and heated swimming pool...Then decided to sell our UK property as we knew we wouldn't be returning, knew we'd always have enough to live a comfortable lifestyle on our income whatever and moved to Spain in December 2008.

Tbh we'd had enough of renting out property as we'd bought and renovated then rented out a few houses a few years ago in Canada and the UK and were frankly sick of dealing with awkward tenants. So we sold the houses and spent the money.

I have always taken the view that money is for spending not hoarding, providing of course that prudent precautions have been taken to safeguard against destitution. If you can't enjoy yourself in retirement after decades of work...what's the point of it all?


----------



## extranjero

There seems to be confusion about pensions. According to Blevins Franks, financial advisors the only pensions to be mentioned are those from annuities, and then only if, with other assets in that category they come to over 50.000 euros.
Don't forget that assets in pounds which you think are under the threshold, when converted into euros will be over!


----------



## baldilocks

For us, the situation has a few minor complications. I am 18 years older than SWMBO and we have SWMBO's mother living with us. 
M-i-l has no income (nothing, nix nada) so is totally dependent upon us and M-i-l is 10 years older than me.
SWMBO will get a less than full pension from UK when she retires (or is allowed to by the UK govt. She may also get a part pension in Spain. By the law of nature, it is possible that by the time she retires, she may well be on her own (there are no other relatives) so we needed to have, in the back of our minds, the planning foresight to allow for the fact that her income may well be drastically reduced in the future.

For us the practical solution is/was to buy a house for cash in a place where all the facilities needed (health centre, shops, bank, post office, ayuntamiento, etc) are close at hand and within walking or mobility scooter range. So the only essential outgoings are the property taxes, water and electricity bills plus the bombonas and food. Hence we can still manage comfortably on about €500-600 per month

Our house in this village is perfect and we have the bonus of having warm, loving, friendly, helpful neighbours who care about each other and those around them.


----------



## extranjero

Hepa said:


> It is not what your house is worth now, but what you originally paid for it.
> 
> I have an interest in a detached property in the U.K. which I bought for the equivalent of 4000€ in 1973, must be worth at least 100,000 Pounds now, but I do not have to declare it because the purchase price was under 50,000€.
> 
> More legislation that has not been very well planned or researched.


Are you sure about that? I have been told it is the value as at 31/12/2013 that must also be entered along with the price you originally bought it for!


----------



## jimenato

extranjero said:


> Are you sure about that? I have been told it is the value as at 31/12/2013 that must also be entered along with the price you originally bought it for!


Yes - I have been told that you have to quote the price as at 31/12/2012 - nothing to do with the purchase price.


----------



## chris&vicky

jimenato said:


> Yes - I have been told that you have to quote the price as at 31/12/2012 - nothing to do with the purchase price.


It is impossible to get an accurate price on a house that has not been sold. A house is worth only what somebody will pay for it. I had mine valued with three valuations. £300k, £350k, and £400k! So who provides the price at 31/12/12?


----------



## extranjero

I think most would choose the lesser valuation!


----------



## chris&vicky

extranjero said:


> I think most would choose the lesser valuation!


So everyone has to get three valuations on their house then do they? 

The whole reporting law is a complete nonsense. It is ill conceived, badly thought out, and rushed though in blind panic. The fines for failing, or incorrectly, reporting are punitive and if ever imposed would be challenged and the law would fall apart. 

It's really not worth losing any sleep over this or changing any of your plans as it will all change within a year. In my opinion of course!


----------



## IanB

extranjero said:


> There seems to be confusion about pensions. According to Blevins Franks, financial advisors the only pensions to be mentioned are those from annuities, and then only if, with other assets in that category they come to over 50.000 euros.
> Don't forget that assets in pounds which you think are under the threshold, when converted into euros will be over!


Again many thanks for all of your comments. As I said the dream is not yet dead in the water. Because of the regulations which came into force from September 2009 derived from the new Companies Act 2006 (the most complex piece of legislation ever placed on the UK Statute Book apparently) there is nothing we can do in reality until year end 2014 (March) unless we just walk away and allow the Crown to take everything that the company owns, (over my dead body LOL) so we have a little time to let things settle. The first declarations will have been made and Spanish tax returns will have been put in, I assume, the first ones following the declaration deadlines and some clarity over the Cyprus issue may be coming out. I understand that there is potential for legal challenge in the ECJ.

As regards renting out here I had not really thought that one out. I don't like loose ends as usually they come back and bite me somehow. Trouble seeks me out I don't have to look for it.

So although the weight falls against at this moment we will be watching the situation closely. I have another issue on interests which is personal to me and the things I usually do and I have yet to put that into the equations but no relevant to this thread at all.

regards
Ian


----------



## gus-lopez

" For immovable property, the value is the cost of acquisition. You also need to provide information on the type of property, its location, and date of acquisition."

" In the case of real estate, the purchase date and price must
be disclosed, as well as the mortgage start and cancellation dates, "
From here. Spanish finance ministries english explanation;

http://www.minhap.gob.es/Documentac...ish/15-11-12 bienes y derechos extranjero.pdf

Although it does appearto say 'value at 31/12/2012 here Articulo 54 number 4 . 

from the full sp here;

http://www.boe.es/boe/dias/2012/11/24/pdfs/BOE-A-2012-14452.pdf


----------



## JaneyO

Anybody know, when calculating the value at 31/12/12 what official euro-sterling exchange rate we are supposed to use? Does the hacienda have an official one? The gestor said look it up online but it seems to vary!


----------



## gus-lopez

baldilocks said:


> For us, the situation has a few minor complications. I am 18 years older than SWMBO and we have SWMBO's mother living with us.
> M-i-l has no income (nothing, nix nada) so is totally dependent upon us and M-i-l is 10 years older than me.
> SWMBO will get a less than full pension from UK when she retires (or is allowed to by the UK govt. She may also get a part pension in Spain. By the law of nature, it is possible that by the time she retires, she may well be on her own (there are no other relatives) so we needed to have, in the back of our minds, the planning foresight to allow for the fact that her income may well be drastically reduced in the future.
> 
> For us the practical solution is/was to buy a house for cash in a place where all the facilities needed (health centre, shops, bank, post office, ayuntamiento, etc) are close at hand and within walking or mobility scooter range. So the only essential outgoings are the property taxes, water and electricity bills plus the bombonas and food. Hence we can still manage comfortably on about €500-600 per month
> 
> Our house in this village is perfect and we have the bonus of having warm, loving, friendly, helpful neighbours who care about each other and those around them.


Off topic but of interest to you.You do know that under EU legislation once you have entitlement to a pension in more than one EU country the amount of pension paid by any country increases, over & above the basic country pension ,as prescribed by EU legislation. 

I.E. If you are entitled to a full basic UK pension & say for example that it is £100/week & you also have entitlement to 5 years pension in Spain , then the UK pension has to be paid at the higher EU calculated rate as well as the Spanish one . :clap2:


"Example"

"Rosa worked 20 years in country A and 20 years in country B.

At the national rates, she would get 800 euros a month from A and 900 euros from B — a total monthly pension of 1 700 euros.

But taking into account the contribution periods abroad (the 'EU rates'), Rosa's monthly pension would be 1 000 euros from A and 1 150 euros from B.

Rosa is entitled to this higher amount — 2 150 euros a month."

From here .
EU - Pension claims and calculation of EU pensions-Your Europe


I knew the <EU was good for something !


----------



## gus-lopez

JaneyO said:


> Anybody know, when calculating the value at 31/12/12 what official euro-sterling exchange rate we are supposed to use? Does the hacienda have an official one? The gestor said look it up online but it seems to vary!


The average for last year was 1.233

the "official" annual rate for Renta declarations.

for 31st December is 1.222

It could be you ! :rofl:
http://blogs.browardpalmbeach.com/pulp/HomelessShoppingCart.jpg


----------



## JaneyO

gus-lopez said:


> The average for last year was 1.233
> 
> the "official" annual rate for Renta declarations.
> 
> for 31st December is 1.222
> 
> It could be you ! :rofl:
> http://blogs.browardpalmbeach.com/pulp/HomelessShoppingCart.jpg


Thank you! Loved the pic- beginning to wish I could fit my assets into a shopping trolley!


----------



## GallineraGirl

GallineraGirl said:


> We have been told that we have to declare the value of our pensions for the new law ( except for state pensions). If you have a personal pension, you know what the value of the annuity was that you have had invested to provide you with the pension but if you have an occupational final salary pension (defined benefit scheme) you are not told what the amount invested, on your behalf is, to provide your pension. We have heard that there is a formula that can be used by gestors to calculate a value for your pension 'pot' using your current age and what you receive in pension payments. Our Gestor has no knowledge of this. Can anyone tell us what this formula is, or where to find it, so that we can complete our asset declaration as, at present, we do not know whether our pensions are worth over 50,000€.
> 
> Also, what is the situation regarding government pensions e.g. Teacher,, Police etc. which can only be taxed in England and include a lump sum when paid. Should these be declared as an asset? And what if you will have a pension in the future but are not taking it yet. Should that be declared as an asset too?
> 
> Any help in answering these questions would be gratefully received and may prevent further sleepless nights.


I have spent all day researching this on the Internet and cannot find the answer to my questions, although someone has suggested the same formula is used that is used for calculating annuities in the Wealth Tax Law. Does anyone know where to find this information?

Where can we sign the petition about the Asset Law?

Thank you for any information.


----------



## CapnBilly

GallineraGirl said:


> We have been told that we have to declare the value of our pensions for the new law ( except for state pensions). If you have a personal pension, you know what the value of the annuity was that you have had invested to provide you with the pension but if you have an occupational final salary pension you are not told what the amount invested, on your behalf is, to provide your pension. We have heard that there is a formula that can be used by gestors to calculate a value for your pension 'pot' using your current age and what you receive in pension payments. Our Gestor has no knowledge of this. Can anyone tell us what this formula is, or where to find it, so that we can complete our asset declaration as, at present, we do not know whether our pensions are worth over 50,000€.
> 
> Also, what is the situation regarding government pensions e.g. Teacher,, Police etc. which can only be taxed in England and include a lump sum when paid. Should these be declared as an asset? And what if you will have a pension in the future but are not taking it yet. Should that be declared as an asset too?
> 
> Any help in answering these questions would be gratefully received and may prevent further sleepless nights.


GallineraGirl

You do not have to declare a UK Government Pension, as described by you, nor do you have to declare a personal pension that hasn't been drawn. You do have declare a pension that you used to purchase an annuity, As you say in your second post, there is a formula to arrive at this, and it is set out in the Stamp and Transfer Act. It is referenced in the FAQ on the Hacienda website. Its article 10f of ley 1/1993 Real Decreto Legislativo 1/1993, de 24 de septiembre, por el que se aprueba el Texto Refundido de la Ley del Impuesto sobre Transmisiones Patrimoniales y Actos Jurdicos Documentados..


There's a very good post on how to complete form, and a simple example of the calculation here


----------



## GallineraGirl

Thank you for all the information. I am happy now, that I do not have to declare a pension that I am not receiving But have I got this clear regarding the defined benefit occupational final salary pension, where I have not purchased an annuity, ( even though I have paid into a scheme via my salary to provide me with a pension) that I do not have to enter this in Modelo 720? Where does it officially say this? I am still confused about this as in the guidance from the Hacienda it says:

'No existe obligación de información sobre los planes de pensiones (de las aportaciones a los mismos) en tanto no se produzca la incidencia que da lugar al cobro de la pensión en modo de renta temporal o vitalicia.

There is no obligation to provide information on pension plans provided that they do not give rise to a temporary or lifetime income.'

This implies that you do have to declare a pension that provides a life time income....

(The pension, under the Wealth Tax rules would be worth over 50,000€ and it is not a government pension)


----------



## CapnBilly

GallineraGirl said:


> Thank you for all the information. I am happy now, that I do not have to declare a pension that I am not receiving But have I got this clear regarding the defined benefit occupational final salary pension, where I have not purchased an annuity, ( even though I have paid into a scheme via my salary to provide me with a pension) that I do not have to enter this in Modelo 720? Where does it officially say this? I am still confused about this as in the guidance from the Hacienda it says:
> 
> 'No existe obligación de información sobre los planes de pensiones (de las aportaciones a los mismos) en tanto no se produzca la incidencia que da lugar al cobro de la pensión en modo de renta temporal o vitalicia.
> 
> There is no obligation to provide information on pension plans provided that they do not give rise to a temporary or lifetime income.'
> 
> This implies that you do have to declare a pension that provides a life time income....
> 
> (The pension, under the Wealth Tax rules would be worth over 50,000€ and it is not a government pension)


Well, the actual requirement says that you have to declare an annuity, which you purchased with capital, and in addition, in the declaration you have to provide the name of the insurance company. I cannot post you to an official link which confirms the information I have given you, but I think I posted a link to the actual law in response to a post by you a while ago. I posted this on the forum I linked to in the earlier post, and I have made other posts of a similar nature. The reference I make to wealth tax is ley 19/1991.

"
As I have posted before, Blevins are advising all their clients that they do NOT need to declare defined benefits pensions, including in their regular radio broadcasts. I think their reputation is well known, and they would be unlikely to provide the wrong advice, as the potential impact on their business would be huge.

The other point I have made before, in addition to the need for purchase with capital, is that under a defined benefits scheme, you have the right to a income as a pension. It is clear, (well to me anyway) that they relate all the valuations, reporting detail etc, back to the wealth tax law, and under that law rights to a pension are exempt.

I think to understand the difference you have to consider the reasons for the new law. In addition to information for future capital gains, inheritance and wealth tax etc, they are interested in assets that may have been bought with undeclared income. Anyone can buy an annuity with a cash sum, a defined benefits pension is built up over a period of time, with above board, recorded contributions from employees and employers."


----------



## CapnBilly

mrypg9 said:


> I have always taken the view that money is for spending not hoarding, providing of course that prudent precautions have been taken to safeguard against destitution. If you can't enjoy yourself in retirement after decades of work...what's the point of it all?


Spoke on Mary. It took me a long while to learn that you work to live, not the other way round. We have a policy in our house of "see it, want it, buy it". We are lucky that we can afford to do that. 

We have two children, both of whom have very good jobs, and are very high earners ( we must have done something right), so are not expecting, and don't need anything from us.

As I say to my wife, what's the point in having money, if its not for spending on ourselves. We are lucky that we woke up this morning, some people didn't. Some of those people were not expected to wake up, others were. You never know when it's your turn, and it doesn't seem to matter how well, or healthy you are.

This is not meant to be morbid, just realistic.


----------



## CapnBilly

JaneyO said:


> Anybody know, when calculating the value at 31/12/12 what official euro-sterling exchange rate we are supposed to use? Does the hacienda have an official one? The gestor said look it up online but it seems to vary!


Janey0

The official rate for the modelo 720 return, as opposed to the Renta is 1.2253


----------



## JaneyO

CapnBilly said:


> Janey0
> 
> The official rate for the modelo 720 return, as opposed to the Renta is 1.2253


Thank you! How do you people know this stuff????


----------



## mrypg9

extranjero said:


> There seems to be confusion about pensions. According to Blevins Franks, financial advisors the only pensions to be mentioned are those from annuities, and then only if, with other assets in that category they come to over 50.000 euros.
> Don't forget that assets in pounds which you think are under the threshold, when converted into euros will be over!


As such pension investment usually provides an income it would have to be reported to Hacienda anyway, not just for the purposes of this new requirement.


----------



## mrypg9

CapnBilly said:


> Spoke on Mary. It took me a long while to learn that you work to live, not the other way round. We have a policy in our house of "see it, want it, buy it". We are lucky that we can afford to do that.
> 
> We have two children, both of whom have very good jobs, and are very high earners ( we must have done something right), so are not expecting, and don't need anything from us.
> 
> As I say to my wife, what's the point in having money, if its not for spending on ourselves. We are lucky that we woke up this morning, some people didn't. Some of those people were not expected to wake up, others were. You never know when it's your turn, and it doesn't seem to matter how well, or healthy you are.
> 
> This is not meant to be morbid, just realistic.


And also very positive, Cap'n.

Like you, my son is a high earner...so we are unrepentant SKINs. In fact, I've told him that if we live longer than expected and end up broke, he'll find us on his doorstep with suitcases and Zimmerframes.

How right you are about wanting and buying. This may sound daft but I'm still regretting not buying a pair of shiny soft leather boots I tried on in Prague...in 1999!

Also right about being lucky just to wake up. Having been fit and healthy all my life, never had a serious illness, I was shocked to learn I have a potentially serious problem. I'll get it fixed but it has made me think. A younger friend has just had an op for colon cancer and faces six months of chemotherapy. You never know what's round the corner.

So when I was in the UK at a Conference last week, I took a break from the debates to go shopping. I completely replenished my nightwear and underwear stocks - just in case I pass out in the street - and bought a few other things that took my eye in my favourite shop, TK Maxx.

There are indeed no pockets in shrouds...


----------



## Stravinsky

extranjero said:


> Are you sure about that? I have been told it is the value as at 31/12/2013 that must also be entered along with the price you originally bought it for!





jimenato said:


> Yes - I have been told that you have to quote the price as at 31/12/2012 - nothing to do with the purchase price.


Just to make comment on this, the value that you declare for your house is the acquisition value, crazy as that sounds. It may change of course when they work out how stupid that is, but straight from gestor, hacienda ... its the acquisition figure.

That means if you have owned the house for many years the value will be completely wrong

Snatched from another forum

_The relevant law states the following:-

2. La declaración informativa contendrá los siguientes datos:

a) Identificación del inmueble con especificación, sucinta, de su tipología, según se determine en la correspondiente orden ministerial.

b) Situación del inmueble: país o territorio en que se encuentre situado, localidad, calle y número.

*c) Fecha de adquisición.*

*d) Valor de adquisición.*

http://www.boe.es/diario_boe/txt.php...E-A-2012-14452

Articulo 54 bis 2._


----------



## gus-lopez

Stravinsky said:


> Just to make comment on this, the value that you declare for your house is the acquisition value, crazy as that sounds. It may change of course when they work out how stupid that is, but straight from gestor, hacienda ... its the acquisition figure.
> 
> That means if you have owned the house for many years the value will be completely wrong
> 
> Snatched from another forum
> 
> _The relevant law states the following:-
> 
> 2. La declaración informativa contendrá los siguientes datos:
> 
> a) Identificación del inmueble con especificación, sucinta, de su tipología, según se determine en la correspondiente orden ministerial.
> 
> b) Situación del inmueble: país o territorio en que se encuentre situado, localidad, calle y número.
> 
> *c) Fecha de adquisición.*
> 
> *d) Valor de adquisición.*
> 
> http://www.boe.es/diario_boe/txt.php...E-A-2012-14452
> 
> Articulo 54 bis 2._


But at no.4 , as I posted, it states at end of year . But does that mean if you sold it during the year ?

My theory is that if you declare the aquisition value , & say like Hepa it was 4k , & you now sell it for 100k, the tax will be on a capital gain of 96k less indexing . Which is the spanish system &it is not geared for the huge gains possible in the UK market. Which will lead to huge tax bills & a happy spanish taxman.


----------



## CapnBilly

gus-lopez said:


> But at no.4 , as I posted, it states at end of year . But does that mean if you sold it during the year ?
> 
> My theory is that if you declare the aquisition value , & say like Hepa it was 4k , & you now sell it for 100k, the tax will be on a capital gain of 96k less indexing . Which is the spanish system &it is not geared for the huge gains possible in the UK market. Which will lead to huge tax bills & a happy spanish taxman.


Gus

I believe you are spot on. Thats why they're only interested in the acquisition value. I posted early on that they;re collecting the data to ensure that people properly declare their worldwide income and capital gains, as well as having information for IHT.


----------



## GallineraGirl

Thank you for your very comprehensive reply and I can see the sense of what you say, as if a final salary pension was treated in the same way as a money purchase (annuity) type pension then we would all be able to say our pensions were annunities and pay a lower rate of tax on them than we do now.....I can't imagine the Hacienda wanting that.

There is still a huge amount of conflicting advice around about whether to declare a final salary scheme or not but as you say BF are a reputable company and I think there would be a huge fuss if they were wrong and all their clients fined. I think I will go with your advice and not put the pension on the form. I have to admit to still feeling very uneasy but at least when it's submitted there will be no point in worrying about it!

Thanks for your help.


----------



## CapnBilly

I'd be quite happy to declare mine if it was taxed as an annuity, where do I sign ?


----------



## zilly

Thanks CapnBilly for all the info. ------ I too have a NHS final salary pension,a UK pension and a very small amount in a UK bank---and after reading all the info. feel fairly happy that I should not be declaring on modelo 720.The problem seems to be that different gestors are all saying different things...


----------



## CapnBilly

zilly said:


> Thanks CapnBilly for all the info. ------ I too have a NHS final salary pension,a UK pension and a very small amount in a UK bank---and after reading all the info. feel fairly happy that I should not be declaring on modelo 720.The problem seems to be that different gestors are all saying different things...


You should read the post I made about changes to the DTA, as you may be affected if your NHS pension is a government one, if not, you will be okay.


----------



## zilly

Thankyou-- will read!


----------



## Tilley

So if we come to Spain January 2014, would we be looking at filling in mondelo 720 by 30th April 2014.

Apologies if this is a dumb question I have tried to follow everything on here, but have lots going on at home as well so may have missed something vital.

I assume it will be a one off declaration for existing folk and newbies, or an annual declaration if your assets increase by 20,000 euros in a 12 month period ?

I assume new arrivals in to the Country will have a set deadline to complete information by, and not a moveable deadline defined by arrival date or am I delving into the unknown ?

Sounds like anyone who is not there already would be better served moving stuff off shore, especially if they are only here for one or two years or maybe we should just be buying a load of fine wines to store and then drink !


----------



## chris&vicky

gus-lopez said:


> But at no.4 , as I posted, it states at end of year . But does that mean if you sold it during the year ?
> 
> My theory is that if you declare the aquisition value , & say like Hepa it was 4k , & you now sell it for 100k, the tax will be on a capital gain of 96k less indexing . Which is the spanish system &it is not geared for the huge gains possible in the UK market. Which will lead to huge tax bills & a happy spanish taxman.


I think your theory is so far way off beam. I cannot believe what am reading in this topic. Time to opt out I think. Which I am sure will please certain people. Paranoia comes to mind.


----------



## JaneyO

The deadline for 2014 will be end of March not April. You will not have been tax resident in Spain in 2013 so I don't know if you will need to do it for 2013 or not. I don't think moving anything offshore will help they want to know about everything wherever it is! I think the fine wine is the best idea! Sorry that was a reply to Tilley forgot to copy the message


----------



## Tilley

JaneyO said:


> The deadline for 2014 will be end of March not April. You will not have been tax resident in Spain in 2013 so I don't know if you will need to do it for 2013 or not. I don't think moving anything offshore will help they want to know about everything wherever it is! I think the fine wine is the best idea! Sorry that was a reply to Tilley forgot to copy the message


Thanks for the reply JaneyO. 

As this year you need to have been tax resident at 31st December 2012 to disclose by 30th April 2013. I'm wondering if left till January 2014 (i.e. miss the 31st December 2013 date) maybe the deadline will be end March 2015 ? which would suit me very well.

The other alternative for someone not yet arrived if they are able to, ie not some kind of multi millionaire but have reasonable assets; to re-organise things so that they do not breach the 50,000 Euros in each category.

My comment regarding off-shore is not so much to do with disclosing, more to do with off-shore assets generally being unavailbale for 'haircut' type actions by struggling governments of where you are domiciled. 

Obvioulsy this is not something I am advising on as I am no financial adviser & people need to seek their own advice based on individual circumstances. 

Presumably it's too late for any already living in Spain to make such arrangements due to the completion date for modelo 720 being imminent, but I guess there will be quite a few who already have funds off-shore as most know what dire straits many European economies are currently in. 

At present on-shore accounts pay little interest the same way as off-shore accounts pay little if no interest, it was different in the days when there was a huge variation in the interest rates on-shore v off-shore, but that is less of a consideration now.


----------



## CapnBilly

chris&vicky said:


> I think your theory is so far way off beam. I cannot believe what am reading in this topic. Time to opt out I think. Which I am sure will please certain people. Paranoia comes to mind.


Err, that's the actual law, so I'm not sure why you think it is off beam.


----------



## chris&vicky

CapnBilly said:


> Err, that's the actual law, so I'm not sure why you think it is off beam.


Err I think you will find that my reply was to somebody's "theory"......

My theory is that if you declare the aquisition value , & say like Hepa it was 4k , & you now sell it for 100k, the tax will be on a capital gain of 96k less indexing . Which is the spanish system &it is not geared for the huge gains possible in the UK market. Which will lead to huge tax bills & a happy spanish taxman.


----------



## Tilley

chris&vicky said:


> Err I think you will find that my reply was to somebody's "theory"......
> 
> My theory is that if you declare the aquisition value , & say like Hepa it was 4k , & you now sell it for 100k, the tax will be on a capital gain of 96k less indexing . Which is the spanish system &it is not geared for the huge gains possible in the UK market. Which will lead to huge tax bills & a happy spanish taxman.


I think if you reply to 'someones theory' you would be better off quoting that post then, rather than misrepresenting the poster you did quote.

It's common forum etiquette and saves offending folk by saying they are 'way off beam' when it isn't actually them that you mean.


----------



## xxxxxxxxxxxxxxxenjoylife

*question*

If somebody bought a property outside spain let's say 30 years ago
and the value was below 50000 Euro it needs to be reported to the hacienda?


----------



## CapnBilly

chris&vicky said:


> Err I think you will find that my reply was to somebody's "theory"......
> 
> My theory is that if you declare the aquisition value , & say like Hepa it was 4k , & you now sell it for 100k, the tax will be on a capital gain of 96k less indexing . Which is the spanish system &it is not geared for the huge gains possible in the UK market. Which will lead to huge tax bills & a happy spanish taxman.




As I understood your post, you were saying that Gus's theory about having to pay capital gains on the profit of £96k was way off beam and paranoid, whereas I am saying it is the law, which I think you've just found out on another post, unless my interpretation is incorrect.


----------



## chris&vicky

Tilley said:


> I think if you reply to 'someones theory' you would be better off quoting that post then, rather than misrepresenting the poster you did quote.
> 
> It's common forum etiquette and saves offending folk by saying they are 'way off beam' when it isn't actually them that you mean.


I did quote the post????


----------



## Stravinsky

chris&vicky said:


> I think your theory is so far way off beam. I cannot believe what am reading in this topic. Time to opt out I think. *Which I am sure will please certain people. Paranoia comes to mind.*


If that's aimed at me .... I couldnt give a toss really  ... when people start to realise realise that its OK to have an opinion that might not coincide with yours then we'll be getting somewhere. Paranoia ....  

Just out of interest, how long have to lived in Spain and experienced the tax system here? Just asking ... out of interest ....



enjoylife said:


> If somebody bought a property outside spain let's say 30 years ago
> and the value was below 50000 Euro it needs to be reported to the hacienda?


You mean reporting a house in Spain that you already live in?


----------



## chris&vicky

Stravinsky said:


> If that's aimed at me .... I couldnt give a toss really  ... when people start to realise realise that its OK to have an opinion that might not coincide with yours then we'll be getting somewhere. Paranoia ....
> 
> Just out of interest, how long have to lived in Spain and experienced the tax system here? Just asking ... out of interest ....
> 
> 
> 
> You mean reporting a house in Spain that you already live in?


I am not aiming anything at you? You have already told me not to comment on your posts which I don't, as instructed. Am I not allowed to comment on anyone's post or do you own the whole Forum?


----------



## IanB

I don't know whether I am labouring under a misapprehension here, but my reading of it tells me that it is not just assets which individually are valued 50K or over but the whole pot collectively that you have comes to over 50K, That would probably mean an awful lot of people are going to be drawn into the net.


----------



## Stravinsky

chris&vicky said:


> I am not aiming anything at you? You have already told me not to comment on your posts which I don't, as instructed. Am I not allowed to comment on anyone's post or do you own the whole Forum?






IanB said:


> I don't know whether I am labouring under a misapprehension here, but my reading of it tells me that it is not just assets which individually are valued 50K or over but the whole pot collectively that you have comes to over 50K, That would probably mean an awful lot of people are going to be drawn into the net.


Thats always been the case though Ian hasnt it ... keeping it simple, two bank accounts of €26K each and you have to declare, the€52k

Five investments of €11k each, all have to be declared because they make up the one group over €50k

Is that what you meant?


----------



## Tilley

IanB said:


> I don't know whether I am labouring under a misapprehension here, but my reading of it tells me that it is not just assets which individually are valued 50K or over but the whole pot collectively that you have comes to over 50K, That would probably mean an awful lot of people are going to be drawn into the net.


My understanding is that if you have assets in the three different asset classes all of which are are for example 40,000 Euros then you do not have to report as no one of these exceeds 50,000 Euros.

Is that what you mean't ? Maybe it is me labouring under a misapprehension, but I have undertaken extensive reading around this (possibly to no avail if I have it wrong).


----------



## JaneyO

Tilley said:


> My understanding is that if you have assets in the three different asset classes all of which are are for example 40,000 Euros then you do not have to report as no one of these exceeds 50,000 Euros.
> 
> Is that what you mean't ? Maybe it is me labouring under a misapprehension, but I have undertaken extensive reading around this (possibly to no avail if I have it wrong).


You are right. Keep each category below 50,000E and you are ok. Guess who hoped to rearrange things to take advantage of this before the 31/12/12 deadline caught me out! JUst call me Mrs Paranoid. ( ,,, and just because you're paranoid doesn't mean they're not out to get you!)


----------



## IanB

Stravinsky said:


> Thats always been the case though Ian hasnt it ... keeping it simple, two bank accounts of €26K each and you have to declare, the€52k
> 
> Five investments of €11k each, all have to be declared because they make up the one group over €50k
> 
> Is that what you meant?


 Yes, Strav, I read it that if you had TOTAL assets which when added together were in excess of 50K then they all had to be reported. In fact when I questioned my pensions providers on this issue they were singing off the same hymn sheet. That means that it is very easy to exceed the total figure. This is an area which may prove to be troublesome for some. It is relatively easy (Ho Hum) to get those pensions paid tax free either into a UK account or a Spanish account, (following fiscal residency in Spain, but as they are all annuities there is always a cash equivalent value which my providers ( having knowledge of the treaties in general) will in my case would have to be declared as they TOTAL more than the 50K limit regardless of type of asset. We have even looked at the trivial commutation schemes here but they do not help the situation I'm afraid. Add in the house whether we sell or rent it out and we have a bigger problem. A rule of thumb that they gave me which is clearly based on the HMRC trivial commutation calculation is that HMRC always take in assessment 20 times the annual payment before tax as being very close the CEV. And having just had a tax inspection they believe that Spain would take a similar stance. The only thing HMRC believe wouldn''t be taxed in Spain is a government pension and this does not include an NHS pension either that is treated just like a private pension.

As we have said on many occasions its a mess and ill thought out from all sides and we are now sitting it out before committing until some of the dust settles.


----------



## Tilley

JaneyO said:


> You are right. Keep each category below 50,000E and you are ok. Guess who hoped to rearrange things to take advantage of this before the 31/12/12 deadline caught me out! JUst call me Mrs Paranoid. ( ,,, and just because you're paranoid doesn't mean they're not out to get you!)


LOL at being paranoid not meaning they aren't out to get you. :spit:

It's a typical example of a piece of law that is put on the statute books designed to do one thing which it will probably not acheive (ie tracing Spanish folk who have substantial hidden overseas assests) and will probably end up doing something completely different. I'm sure history is littered with such legislation.


----------



## chris&vicky

CapnBilly said:


> As I understood your post, you were saying that Gus's theory about having to pay capital gains on the profit of £96k was way off beam and paranoid, whereas I am saying it is the law, which I think you've just found out on another post, unless my interpretation is incorrect.


I do not think it's as straight forward as that as the property in the example was purchased in 1973. Property bought prior to 31st Dec 1986 is exempt from CGT liability for residents & non-residents, due to old legislation.

Kind regards


----------



## Overandout

Tilley said:


> LOL at being paranoid not meaning they aren't out to get you. :spit:
> 
> QUOTE]
> 
> 
> The late Kurt Cobain if I'm not mistaken?
> 
> :focus:


----------



## CapnBilly

chris&vicky said:


> I do not think it's as straight forward as that as the property in the example was purchased in 1973. Property bought prior to 31st Dec 1986 is exempt from CGT liability for residents & non-residents, due to old legislation.


Well, now you're just spinning, because you've done some more research on capital gains. When you posted you didn't seem to know much about it, so I don't think your comment was based on the above statement.. 

Lets just move on.


----------



## chris&vicky

CapnBilly said:


> Well, now you're just spinning, because you've done some more research on capital gains. When you posted you didn't seem to know much about it, so I don't think your comment was based on the above statement..
> 
> Lets just move on.


....................


----------



## agua642

I see there's a lot of concern over this new ridiculous tax law, I wonder how many tax inspectors they have in Spain! lol 
Like all authorities & companies they try to scare the public and often we feel victimised. These companies including government companies only know what we are willing to tell them... 
All information I'd for future data! long live the computer! 😉


----------



## Eddysep

*Rate exchange*

Hi

We are in the process of selling our house in London and as soon is completed I'm joining my wife in Spain. She is already working in Spain and shortly will need to declare the house to Spanish Tax Authority.

The house was bought in 2002 for £165,000 and not sure which exchange rate should we use when declaring the original purchase value:
e.g. 2002 Euro exchange rate 
or current exchange rate
or average exchange rate?

The Gestor is advising to use an average rate but is not suggesting an actual value. Friends have told us they will be using the exchange rate at the time of purchase. Very confusing!

Your comments will be much appreciated.


----------



## 90199

The tax authority decide the exchange rate


----------



## Eddysep

Thanks Hepa!

Would you advise to fill in the form with the purchase value in £ or contact the tax agency beforehand?


----------



## 90199

Eddysep said:


> Thanks Hepa!
> 
> Would you advise to fill in the form with the purchase value in £ or contact the tax agency beforehand?


It is the purchase value, the exchange rate was decided in December I think, it is on their website, you will have to convert the price. Your Gestor should really be aware of all this.


----------



## agua642

Hi, I don't think you need to declare your house sale until next year.


----------



## snikpoh

agua642 said:


> Hi, I don't think you need to declare your house sale until next year.


Absolutely correct. However, for reporting foreign assets you need to declare the property for last year at 31/12/12 rates (1.222) - if the owner(s) were tax resident in Spain then.

Hepa - you say that the exchange rate 'was decided in December' but for which year? Surely it will be the rate when they bought it against the rate when they sold it (for CGT purposes). When they have to declare the sale of the house (next year) then it will be the December rate THIS year (yet to be determined).


----------



## 90199

snikpoh said:


> Absolutely correct. However, for reporting foreign assets you need to declare the property for last year at 31/12/12 rates (1.222) - if the owner(s) were tax resident in Spain then.
> 
> Hepa - you say that the exchange rate 'was decided in December' but for which year? Surely it will be the rate when they bought it against the rate when they sold it (for CGT purposes). When they have to declare the sale of the house (next year) then it will be the December rate THIS year (yet to be determined).


For the current declaration of assets, in most currencies. If over 50,000€ when purchased.


----------



## expatmat

Why is Spain demanding such a detailed roll call of assets? 

I don't want to be the guy who went round reassuring everyone that "we only have to wear yellow stars, what's the problem with that?"


----------



## 90199

expatmat said:


> Why is Spain demanding such a detailed roll call of assets?
> 
> I don't want to be the guy who went round reassuring everyone that "we only have to wear yellow stars, what's the problem with that?"


Because it's Spain..................


----------



## expatmat

Hepa said:


> Because it's Spain..................


Unfortunately most people think it's just good ole bureaucratic Spain up to its tricks again. In reality, they are laying the ground for some severe fiscal policies and we are willingly giving them all the data they need to make their jobs easier.


----------



## 90199

expatmat said:


> Unfortunately most people think it's just good ole bureaucratic Spain up to its tricks again. In reality, they are laying the ground for some severe fiscal policies and we are willingly giving them all the data they need to make their jobs easier.


Bit daft though wanting last years assets, assets change on a daily basis, and the ones that have probably the most value, they did not require me to declare.


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## expatmat

Hepa said:


> Bit daft though wanting last years assets, assets change on a daily basis, and the ones that have probably the most value, they did not require me to declare.


The whole thing is daft! Doesn't mean it ain't happening.


----------



## 90199

expatmat said:


> The whole thing is daft! Doesn't mean it ain't happening.



Not just Spain though. Overseas income has always had to be declared in other places I have lived. Cannot say I am too worried about this Spanish inquisition.


----------



## expatmat

Hepa said:


> Not just Spain though. Overseas income has always had to be declared in other places I have lived. Cannot say I am too worried about this Spanish inquisition.


Declaring overseas income? The herb out on the island must be pretty damned good my friend


----------



## ocraz

Hi I've just been Reading this thread and find it very interesting. I am from UK and living in Andalucia. I have been to see a hectoria who tells me I have to get oficial valuation for my property in England. I am retired and my children are living in my house in England. Would you know how I go about this? He said that an Estate Agent is not aceptable. Spain is really complicating the laws. Would appreciate any info you could help me with.


----------



## xabiaxica

ocraz said:


> Hi I've just been Reading this thread and find it very interesting. I am from UK and living in Andalucia. I have been to see a hectoria who tells me I have to get oficial valuation for my property in England. I am retired and my children are living in my house in England. Would you know how I go about this? He said that an Estate Agent is not aceptable. Spain is really complicating the laws. Would appreciate any info you could help me with.


you only have until Tuesday to submit the declaration - & the *gestor *(not hectoria) is wrong in any case

you have to declare what you paid for the property, & then only if you paid more than 50,000 €


----------



## 90199

xabiachica said:


> you only have until Tuesday to submit the declaration - & the *gestor *(not hectoria) is wrong in any case
> 
> you have to declare what you paid for the property, & then only if you paid more than 50,000 €


I can second that. I have an interest in a detached house I bought in 1973, for 3820 GBP, goodness knows what it is worth now, but I do not have to declare it, crazy but that is the law!!


----------



## ocraz

Hepa said:


> I can second that. I have an interest in a detached house I bought in 1973, for 3820 GBP, goodness knows what it is worth now, but I do not have to declare it, crazy but that is the law!!



Thanks so much for the reply

Well that's certainly good news for me then as I bought the house in 1980 at a Price of 27,000 so does this mean I do not have to declare it?

Did you have to show proof of the amount you paid for your house in Uk? I have been told I need to supply this.


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## extranjero

*Think before you move*

Before anyone contemplates moving to Spain, they should consider the following:
The tax laws are already draconian and unfair, and will get worse;if you have savings plans and lots of assets in UK think very carefully.
If under state pension age,health cover is a major factor, especially if you have existing conditions which Health insurance companies will not cover.
If you have school age children consider the disruption to their schooling
Have you got at least a years salary in reserve in case things go wrong?
If you're looking for work, forget it!
It is easier and less stressful to have a couple of holidays in Spain, rather than go through all the possible trauma in Spain.
Don't be seduced by low property prices and programmes that dwell on sipping wine on your terrace, picking lemons etc.
I'm not pessimistic-just REALISTIC!


----------



## chris&vicky

extranjero said:


> Before anyone contemplates moving to Spain, they should consider the following:
> The tax laws are already draconian and unfair, and will get worse;if you have savings plans and lots of assets in UK think very carefully.
> If under state pension age,health cover is a major factor, especially if you have existing conditions which Health insurance companies will not cover.
> If you have school age children consider the disruption to their schooling
> Have you got at least a years salary in reserve in case things go wrong?
> If you're looking for work, forget it!
> It is easier and less stressful to have a couple of holidays in Spain, rather than go through all the possible trauma in Spain.
> Don't be seduced by low property prices and programmes that dwell on sipping wine on your terrace, picking lemons etc.
> I'm not pessimistic-just REALISTIC!


Why are you in Spain then?


----------



## mrypg9

expatmat said:


> The whole thing is daft! Doesn't mean it ain't happening.


Every one of your posts has been based on supposition. 
The FACTS are that everyone living as a tax resident in Spain -and that includes Spaniards, Brits, Germans, Russians, Dutch, Eskimpos, Martians - all have to declare overseas assets.

Since there are few assets which do not generrate some kind of income, however nominal, honest people will have declared these to Hacienda already.

What is it with British immigrants that causes some of them to panic so easily...
Immigrants of other nationalities who are probably wealthier on the whole than most Brits aren't reading sinister intent into this.

FFS,even HMRC can't do its sums right. My partner and I are subject to claims for large amounts of what they claim is unpaid tax....yet we have both declared all our income as required and as we have always done,. whatever its source. The error stems from HMRC. 

We are more concerned with HMRC than Hacienda..


----------



## extranjero

chris&vicky said:


> Why are you in Spain then?


I don't have to worry about health care, being a pensioner. I don't have school aged children, but many people on this forum do have these concerns.
The tax laws have changed since I came here 12 years ago, not for the better. A lot of other things have changed too. Look through different forums to see other people's experiences and horror stories, not resulting from naivety, but injustice, and they are not unusual.I would like to go back to the UK-I haven't any illusions about that either, but for people in my situation, tax wise and health wise, Spain is not a good place to be.


----------



## ocraz

xabiachica said:


> you only have until Tuesday to submit the declaration - & the *gestor *(not hectoria) is wrong in any case
> 
> you have to declare what you paid for the property, & then only if you paid more than 50,000 €


Thanks xabiachica for this fantastic news. Have spent day after day going from one government office to the other each one telling me different.


----------



## Pazcat

mrypg9 said:


> Immigrants of other nationalities who are probably wealthier on the whole than most Brits aren't reading sinister intent into this.


Well apart from the wealthier part you're right. It's been the same situation in Belgium for years, I have to declare my Australian bank account on the tax form by law. If I had any assets or foreign income they would need to be declared too, there is no threshold or cut off point you just need to declare all of your foreign assets.
So you do, it's no biggy as long as you are paying your taxes somewhere.

Maybe I'd be more concerned if I had other assets to worry about but I don't, although it would be a welcome worry at that. I like assets, at least I think I do, it'd be nice to have some.


----------



## extranjero

*detailed assets*



mrypg9 said:


> Every one of your posts has been based on supposition.
> The FACTS are that everyone living as a tax resident in Spain -and that includes Spaniards, Brits, Germans, Russians, Dutch, Eskimpos, Martians - all have to declare overseas assets.
> 
> Since there are few assets which do not generrate some kind of income, however nominal, honest people will have declared these to Hacienda already.
> 
> What is it with British immigrants that causes some of them to panic so easily...
> Immigrants of other nationalities who are probably wealthier on the whole than most Brits aren't reading sinister intent into this.
> 
> FFS,even HMRC can't do its sums right. My partner and I are subject to claims for large amounts of what they claim is unpaid tax....yet we have both declared all our income as required and as we have always done,. whatever its source. The error stems from HMRC.
> 
> We are more concerned with HMRC than Hacienda..


The main thing people are worried about with this new assets law is the tremendous amount of private details required, which makes people worry as to how It is used or misused ID theft, info hacked into on computer etc.Why have to provide Account nos,IBAN, when opened etc. Do people in other countries have to provide so much detail ?Re having to have previously declared everything anyway, There are bonds etc which are not declared till cashed in, so there are assets which previously did not have to be declared.


----------



## mrypg9

Pazcat said:


> Well apart from the wealthier part you're right. It's been the same situation in Belgium for years, I have to declare my Australian bank account on the tax form by law. If I had any assets or foreign income they would need to be declared too, there is no threshold or cut off point you just need to declare all of your foreign assets.
> So you do, it's no biggy as long as you are paying your taxes somewhere.
> 
> Maybe I'd be more concerned if I had other assets to worry about but I don't, although it would be a welcome worry at that. I like assets, at least I think I do, it'd be nice to have some.



The same applies in the UK too - and in most other developed countries.

I only hope that Hacienda's trawl does catch those wealthy people who attempt to hide their substantial assets in offshore tax havens. 
What annoys me about HMRC is that they are pestering us for something which is down to error on their part, not false declarations or oversight on ours. All this while the owners of the Ritz haven't paid tax for over a decade and the superrich pay clevr tax lawyers to avoid tax due.

Some British immigrants here seem to be easy prey to fears,rumours and misinformation of all kinds. Why this should be I don't know: maybe because many retired people have had little experience of 'abroad' apart from holidays in Spain and view all things Spanish with suspicion, trepidation even, especially those who prefer to live in predominantly British immigrant communities?

Being an island does give a sense of 'apartness'. Other continental countries with land borders are more accustomed to 'foreign-ness', perhaps


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## ocraz

Hi, I live in small village and can honestly say that until last week, knew nothing of the new law. I am retired here and want to be legal. Several people I advised knew nothing either. Living in the campo, I have only just been able to receive internet and in this part of Andalucia there are lots of people who are in the same position. Personally, it is the lack of time since finding out that freaks me out, this being the reason I went to a gestor, who, apparently has given me incorrect information anyway. Due to joining this fórum, I have found out exactly what is and what isnt included in the declaration and for me it is good news. Now all I have to do is convince the gestor that he is wrong. hahahaha that should be fun...


----------



## chris&vicky

extranjero said:


> I don't have to worry about health care, being a pensioner. I don't have school aged children, but many people on this forum do have these concerns.
> The tax laws have changed since I came here 12 years ago, not for the better. A lot of other things have changed too. Look through different forums to see other people's experiences and horror stories, not resulting from naivety, but injustice, and they are not unusual.I would like to go back to the UK-I haven't any illusions about that either, but for people in my situation, tax wise and health wise, Spain is not a good place to be.


I understand that you no longer get state health care if under retirement age, although you do get some up to 2 1/2 years. Spain has many health advantages though, like the climate. Property is cheaper in Spain so if you put aside some of the savings this will help where health cover gaps occur.

I do read many forums and the conclusion I reach is that many are unhappy because they lived in Spain without paying their taxes to them, and now they find Spain are trying to track them down and make them pay, fair enough in my view. I am NOT saying that applies to you I am sure you have your own reasons.

With regard to tax, I would advise anyone to get professional advise and not take it from forums. A lot written in forums is contradictory and based on little fact. Why so much hysteria about reporting your assets? If living in Spain you pay your taxes in Spain. You pay tax on income and income is generated from assets. I can see why Spain wants assets reported, they should have been reported anyway. They are just applying very high penalties to try frighten people to pay what they should under current law.

One question on your lists of "why not to move to Spain" if you don't mind, apart from having to pay tax on income generated from savings, what is your concern about having savings plans? I think the reverse applies, it's foolhardy to move to Spain if you have no savings plans, and where they are is rather irrelevant surely?


----------



## extranjero

I f you are under state pension age have chronic medical conditions, then you would have to be very rich to cover all the expenses, if not accepted for health cover.
The reason for not having savings plans started in the UK, and maturing after becoming tax resident is that it may be tax free in UK, but it won't be in Spain, and the tax man would want a big chunk of it, wiping out the interest and bonuses built up over years!
I pay my taxes in Spain. I object to the huge fines for what may be innocent or inadvertent mistakes or irregularities on the form, put in by an accountant.If fraud is the case, yes of course, hit them in the pocket,but not huge disproportionate fines for those never intending to defraud. Why do you think there has been a petition to the EU about this law? Tell me- how will this new law catch thousands of expats who have lived here for years and never registered on the Spanish tax system? What it will do is target and fine some unfortunate expat, trying to do the right thing and making an innocent mistake.
To the person in the village who says she has only just found out about it;Do you not get free expat newspapers? They have been full of the new law since last November.


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## snikpoh

extranjero said:


> ...
> 
> To the person in the village who says she has only just found out about it;Do you not get free expat newspapers? They have been full of the new law since last November.


You must remember that MOST of Spain does not get expat newspapers.

We used to get them here but don't any more - just a sign of the times! Places that used to stock them don't any more, some have gone bust and others just don't circulate to areas with a low number of expats.


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## baldilocks

extranjero said:


> To the person in the village who says she has only just found out about it;Do you not get free expat newspapers? They have been full of the new law since last November.


Free expat newspapers, around here? NO The odd ones I have seen are so riddled with errors and have such tacky and crappy rubbish in them that they put the Gruniad, Sun mirror et al in the shade


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## baldilocks

We don't think that the new law applies to us anyway but just to make sure< i have been trying to get a copy of the Formulario 720 either online or downloadable withoutr success. Hacienda's own website(s) don't offer a link. Anybody got a link for the form?


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## extranjero

Round town News, EuroWeekly, Sol Times
Costa Blanca News(not free) 
Although there are contradictions in these newspapers, they do inform you as to what is happening in your area. If you do not have internet how else would you find out about all the new laws? In any case there are phone numbers in them , to find out more.
Out here you don't receive letters telling you what you have to do ;you have to be proactive as ignorance is not an excuse!


----------



## xabiaxica

extranjero said:


> Round town News, EuroWeekly, Sol Times
> Costa Blanca News(not free)
> Although there are contradictions in these newspapers, they do inform you as to what is happening in your area. If you do not have internet how else would you find out about all the new laws? In any case there are phone numbers in them , to find out more.
> Out here you don't receive letters telling you what you have to do ;you have to be proactive as ignorance is not an excuse!


I never pick up the expat newspapers - although we have several of them here

my gestor wrote to me about the new reporting rules though


----------



## mrypg9

extranjero said:


> I don't have to worry about health care, being a pensioner. I don't have school aged children, but many people on this forum do have these concerns.
> The tax laws have changed since I came here 12 years ago, not for the better. A lot of other things have changed too. Look through different forums to see other people's experiences and horror stories, not resulting from naivety, but injustice, and they are not unusual.I would like to go back to the UK-I haven't any illusions about that either, but for people in my situation, tax wise and health wise, Spain is not a good place to be.


My partner and I are now both retired and therefore in receipt of a UK State Pension, such as it is, along with our other incomes,and qualify for free health care. It does seem that for retired people with good incomes and sufficient capital, Spain is a very good place to be.

Every time I visit the UK and return home to Spain my spirits lift. We didn't come here to pursue the 'Spanish dream' or with the illusion that sun and cheap alcohol were the chief ingrdients of the 'good life'. We had both travelled widely and lived in other European countries and we thought, correctly as it turned out, that leaving the UK when we both stopped working would be like leaving home for the first time: an exciting new chapter in life.

Which it has turned out to be.


----------



## extranjero

Free health care, sufficient capital-you've said it all; for everyone else, think hard before moving here!


----------



## chris&vicky

extranjero said:


> I f you are under state pension age have chronic medical conditions, then you would have to be very rich to cover all the expenses, if not accepted for health cover.
> The reason for not having savings plans started in the UK, and maturing after becoming tax resident is that it may be tax free in UK, but it won't be in Spain, and the tax man would want a big chunk of it, wiping out the interest and bonuses built up over years!
> I pay my taxes in Spain. I object to the huge fines for what may be innocent or inadvertent mistakes or irregularities on the form, put in by an accountant.If fraud is the case, yes of course, hit them in the pocket,but not huge disproportionate fines for those never intending to defraud. Why do you think there has been a petition to the EU about this law? Tell me- how will this new law catch thousands of expats who have lived here for years and never registered on the Spanish tax system? What it will do is target and fine some unfortunate expat, trying to do the right thing and making an innocent mistake.
> To the person in the village who says she has only just found out about it;Do you not get free expat newspapers? They have been full of the new law since last November.


I am not living in Spain yet I am planning to move soon. My partner already lives in Spain that is why I am planning a long term move. Therefor I was interested you your reasons for not making the move but did not understand many of your concerns. I read the forums to try and understand the views of those who live in Spain. But everyone's views differ so much, but that is life. Some people are happy, some are not, it is the same wherever you live.

If you have chronic pre-existing medical conditions and are not entitled to state heath care then making the move would be rather risky unless you had an escape home plan in place.

Interest on savings is pathetic, even in the UK. I am really not concerned if they tax my interest, most would have been taxed in the UK anyway. There are a few things I may move around before becoming tax resident to avoid unnecessary tax. My only concern is that they would grab the capital in some way, which is what I thought you were suggesting, but I really can't see that happening.

Unfortunately I tend to agree that many expats who have never registered will not be caught, but from what I read it is being made more difficult to do many things if you do not register.

I totally agree that the huge disproportionate fines are wrong and unfair, but will they ever be imposed, or is it just scare tactics? I guess we will find out in due course.

I am not trying to disrespect your views, I hope I did not come across that way. I am just trying to get a balanced view.


----------



## Pesky Wesky

chris&vicky said:


> I am not trying to disrespect your views, I hope I did not come across that way. I am just trying to get a balanced view.


I think you have read many posts on this forum and as you have already said there are many different points of view.
On this forum the vast majority are happy or at least see more positives than negatives to their life in Spain compared to their country of origin. A few are not happy, and a few have recently begun to rethink their future because of changes the government have made in tax or healthcare or whatever. People's lives *do* change and so do the countries we have come to. 
Most of the people who are posting have been here for some time and are well established or are new comers with an ok income and don't need to work. Most, not all.
So when people here start questioning the reasoning behind people moving to Spain, even though they are living here themselves, there is most likely some reasoning behind it more than a childish idea of keeping the good bits of Spain to themselves or a delight in telling people that they're stupid

But at the end of the day it's all very subjective...


----------



## 90199

ocraz said:


> Thanks so much for the reply
> 
> Well that's certainly good news for me then as I bought the house in 1980 at a Price of 27,000 so does this mean I do not have to declare it?
> 
> Did you have to show proof of the amount you paid for your house in Uk? I have been told I need to supply this.


I did not have to show proof of purchase price, according to the gestor I used.

You do not have to declare your house, 'cos the price was under 50,000€ when you bought it, so no more worries


----------



## chris&vicky

Pesky Wesky said:


> So when people here start questioning the reasoning behind people moving to Spain, even though they are living here themselves, there is most likely some reasoning behind it more than a childish idea of keeping the good bits of Spain to themselves or a delight in telling people that they're stupid
> 
> But at the end of the day it's all very subjective...


I do not really understand why you have directed this remark at me? Did I suggest a childish idea or that he was telling me I was stupid? I just read what everyone says and balance it off, which is what I said. 

extranjero reasons for wanting to leave Spain were not very clear to me, and did not think it my business to ask. He himself had said that many of the reasons he gave were not relevant to him.


----------



## Pesky Wesky

chris&vicky said:


> I do not really understand why you have directed this remark at me? Did I suggest a childish idea or that he was telling me I was stupid? I just read what everyone says and balance it off, which is what I said.
> 
> extranjero reasons for wanting to leave Spain were not very clear to me, and did not think it my business to ask. He himself had said that many of the reasons he gave were not relevant to him.


The reason I directed the post to you was because you asked a previous poster something like "Why are you in Spain then?" and also "I was trying to get a balanced view"
My post was just giving you more information to achieve that balanced view.


----------



## chris&vicky

Pesky Wesky said:


> The reason I directed the post to you was because you asked a previous poster something like "Why are you in Spain then?" and also "I was trying to get a balanced view"
> My post was just giving you more information to achieve that balanced view.


I asked why he lived in Spain because I was interested in his remarks. I respect his views. Why being, expand your views, which he kindly did. Sorry if it did not come across that way.


----------



## 90199

I did have any choice in coming to the Canary Islands, I was working on a Shell Tanker at the time and arrived here from Trinidad in 1962 with a cargo of gas oil.

Never for one minute did I think, I would end up here, it is a good life though, no more horrible winters, safer, cheaper place to live, people who actually smile, oranges figs and plums on the trees.

Haven't seen the U.K. for four years now, I cannot say that I miss the old country, I'm always glad to return here to the Meridian Isle.


----------



## Aron

mrypg9 said:


> My partner and I are now both retired and therefore in receipt of a UK State Pension, such as it is, along with our other incomes,and qualify for free health care. It does seem that for retired people with good incomes and sufficient capital, Spain is a very good place to be.
> 
> Every time I visit the UK and return home to Spain my spirits lift. We didn't come here to pursue the 'Spanish dream' or with the illusion that sun and cheap alcohol were the chief ingrdients of the 'good life'. We had both travelled widely and lived in other European countries and we thought, correctly as it turned out, that leaving the UK when we both stopped working would be like leaving home for the first time: an exciting new chapter in life.
> 
> Which it has turned out to be.


Absolutely concur with your post. I could have written the same myself.


----------



## gus-lopez

baldilocks said:


> We don't think that the new law applies to us anyway but just to make sure< i have been trying to get a copy of the Formulario 720 either online or downloadable withoutr success. Hacienda's own website(s) don't offer a link. Anybody got a link for the form?


Agencia Tributaria - 720

Click on Diseño de registro & scroll down to 720 ( click on number) & download pdf.


----------



## cyclequeen

*Confused about Spanish taxation*

Hi Guys, hope you can ease my troubled mind 
We are coming to Spain in June this year with the aim to retire near to our Son, La Linea. We thought we had it all covered financially but now I'm worried I have missed something very important, tax ??
We are 62 hubby & 56 me so he will be getting his state pension in 3 years me 10 !! thanks to the changes here in the UK. We will have the capital from the sale of our house & lump sums from cashed in pensions, plus very small pensions to live on. Question please, I thought that tax would be like here in the UK that is you only get taxed on the income you generate from your investments, ie interest on your savings. Not the capital itself, if this was the case we would struggle. I know that our individual allowance in the UK would not come to more than any interest we are likely to earn & our pensions, hence based on UK we would not be paying any tax at all. Can you tell me if they tax you on your capital you have made from your house in Spain please. We will be banking in Gibraltar, I know we have to declare this & any funds we may leave here in the UK, & a local Spanish bank.  :fingerscrossed:


----------



## 90199

Cycle

If your Bank funds are over 50,000€, or you have property which you *purchased* for over 50,000, or you have investments over 50,000€, outside Spain, then once you have resided in Spain for over 6 months, you must make a declaration.

In addition you must make a tax declaration, in May or June for the previous year, but don't worry it is unlikely from what you have said that you will be paying any Spanish tax.


----------



## CapnBilly

cyclequeen said:


> Question please, I thought that tax would be like here in the UK that is you only get taxed on the income you generate from your investments, ie interest on your savings. Not the capital itself, if this was the case we would struggle. I know that our individual allowance in the UK would not come to more than any interest we are likely to earn & our pensions, hence based on UK we would not be paying any tax at all.


Just to be clear, the individual tax allowances are lower than in the UK. In the UK it's now £9440 (€11140 at today's rate). In Spain the personal allowance is €5151 plus an earned income allowance ranging from €2652 -€4080. Based on your post you would probably get the maximum so €9231. Tax on income in excess of this is 24.75% on earned income ( pension) and 21% on interest. This assumes they are private, not government pensions ( which can only be taxed in the UK) or annuities which are taxed differently. I'll leave you to work out your figures, as if your are near the top of the UK allowances, there may be some tax payable.


----------



## mrypg9

I heard on BBC Radio 4 Today programme that HMRC are seeking details of UK residents accounts in tax havens such as Bermuda, the Cayman Islands, Jersey and other offshore tax havens. It seems they are carrying out exactly the same exercise for UK tax residents are doing for Spanish tax residents, that is, seeking out undeclared assets held overseas. Unlike Spain though HMRC is not giving people a chance to 'fess up, it seems. 

HMRC announced it intends to share details of these accounts -holder's name, code, account number and so on with tax authorities including those of France and Spain.

So as I said in a previous post what is happening with the new reporting requirement is not unique to Spain. The only difference is that HMRC might be marginally, just marginally, more efficient than Hacienda.


----------



## extranjero

*tax on capital?*



cyclequeen said:


> Hi Guys, hope you can ease my troubled mind
> We are coming to Spain in June this year with the aim to retire near to our Son, La Linea. We thought we had it all covered financially but now I'm worried I have missed something very important, tax ??
> We are 62 hubby & 56 me so he will be getting his state pension in 3 years me 10 !! thanks to the changes here in the UK. We will have the capital from the sale of our house & lump sums from cashed in pensions, plus very small pensions to live on. Question please, I thought that tax would be like here in the UK that is you only get taxed on the income you generate from your investments, ie interest on your savings. Not the capital itself, if this was the case we would struggle. I know that our individual allowance in the UK would not come to more than any interest we are likely to earn & our pensions, hence based on UK we would not be paying any tax at all. Can you tell me if they tax you on your capital you have made from your house in Spain please. We will be banking in Gibraltar, I know we have to declare this & any funds we may leave here in the UK, & a local Spanish bank.  :fingerscrossed:


No one has answered cyclequeen-will she be taxed on the capital or the interest on it?


----------



## Aron

extranjero said:


> No one has answered cyclequeen-will she be taxed on the capital or the interest on it?



Perhaps no one is 100% certain to be able to answer it. Unless you are absolutely certain, then best not to give an answer. Personally, I would seek the advice of my gestoria or Abogado.


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## cyclequeen

thank you guys, I'm hopeful that I / we won't be liable for paying any tax as of course our house proceeds must surely be split between us, that is we each have an individual allowance. Also as our pot is not enormous, normal 3 bed semi under the current stamp duty in the UK with as I say very small pensions.
It would be very reassuring to know for sure that the potential tax liability would be for any interest earned on our nest egg & not the capital itself. Does anyone know how I find out for sure before we actually leave the UK in about 6 weeks please?


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## callie

Cyclequeen - Ithink you really need to take professional advice on this from a tax advisor in Spain.

As I understand it once you spend more than 183 days in Spain you become a tax resident and have to make a tax return for that year. Tax years in Spain run from 1st Jan to 31st Dec. Therefore if you are moving in 6 weeks it will be likely that you will be a tax resident in Spain this year and your tax return will have to include all income for the year (even the part when you were in the UK).
This won't matter too much for pension income as the tax treaty between the UK and Spain will allow you to deduct tax paid in the UK from your Spanish tax liability. As others have said the tax allowances in Spain are lower so you may be liable for tax on your pension even if you were below the allowance in Spain.
HOWEVER if you have sold your UK home this year you should declare it is Spain for Capital Gains tax purposes - unlike the UK the 'profit' you make on selling your primary residence is NOT exempt from Capital Gains tax.


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## mrypg9

Surely you will be taxed annually on any interest you receive from your asset.
Most capital whether in the form of invested cash or property returns a yield, however low.
If the property is sold before the poster becomes resident in Spain and the money, after beng split, is invested, then the return on that investment will be taxed.

We sold properties in the UK whilst living in Prague, tax is levied on the income from the capital proceeds invested.
That's the norm, surely.

Some UK pensions are subject to a Dual Taxation Order so tax is deducted in the UK. You may or may not have to pay additional tax depending on the amount of the income.


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## JaneyO

MAybe you should Google a Spanish tax advisor who speaks English, there are lots of them, and get the exact picture. Spanish tax is complicated and the Hacienda is somewhat less benevolent than HMRC. 
My Gestor told me the Spanish tax office is the 'most aggressive in the world' ! You might want to avoid being in Spain for more than 183 days in 2013.


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## 90199

JaneyO said:


> and the Hacienda is somewhat less benevolent than HMRC.


I have to disagree with that statement, we make an appointment and they do our tax returns for us, free!!


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## cyclequeen

Yikes Callie I won't sleep tonight now!!! I didn't think about that one, what the Spanish gov can take capital gains from our only house now it's sold, surely this can't be right. We bought our house over 20 years ago so you can imagine what we have made on it. I'm going to have to get some advice as you say because we won't be going to Spain if this is the case as the money we have made is to last us our lifetime.


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## JaneyO

Hepa said:


> I have to disagree with that statement, we make an appointment and they do our tax returns for us, free!!


Yes that's true the individual offices and folks 'on the ground' are very helpful but the organisation as a whole has some very scary powers!


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## JaneyO

cyclequeen said:


> Yikes Callie I won't sleep tonight now!!! I didn't think about that one, what the Spanish gov can take capital gains from our only house now it's sold, surely this can't be right. We bought our house over 20 years ago so you can imagine what we have made on it. I'm going to have to get some advice as you say because we won't be going to Spain if this is the case as the money we have made is to last us our lifetime.


SYmpathise about the sleepless nights, I've had a few over the modelo 720. Consider delaying your arrival in Spain to avoid the 183 day rule = long holiday in France en route perhaps? But do take advice on your situation it could save you a lot of money.


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## JaneyO

Just had another thought- did you mention pension lump sums? I've been told these have to be declared on tax returns and, unlike the uk, are also taxable here. Sorry! Check it out though.


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## Megsmum

callie said:


> Cyclequeen - Ithink you really need to take professional advice on this from a tax advisor in Spain.
> 
> As I understand it once you spend more than 183 days in Spain you become a tax resident and have to make a tax return for that year. Tax years in Spain run from 1st Jan to 31st Dec. Therefore if you are moving in 6 weeks it will be likely that you will be a tax resident in Spain this year and your tax return will have to include all income for the year (even the part when you were in the UK).
> This won't matter too much for pension income as the tax treaty between the UK and Spain will allow you to deduct tax paid in the UK from your Spanish tax liability. As others have said the tax allowances in Spain are lower so you may be liable for tax on your pension even if you were below the allowance in Spain.
> HOWEVER if you have sold your UK home this year you should declare it is Spain for Capital Gains tax purposes - unlike the UK the 'profit' you make on selling your primary residence is NOT exempt from Capital Gains tax.



If you sell in the UK move to Spain and buy a house you pay capital gains in Spain?


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## snikpoh

cambio said:


> [/COLOR]
> 
> 
> If you sell in the UK move to Spain and buy a house you pay capital gains in Spain?


Doesn't it all depend on whether they were/are both your main residence?


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## gus-lopez

snikpoh said:


> Doesn't it all depend on whether they were/are both your main residence?


They cannot both be your main residence.

Not in Spain. Subject to allowances in some regions between husband/wife , you are liable to CGT on all property sold, & anything else on which you make a capital gain!
Yes many UK citizens, who are now Spanish registered foreign residents, who still own a home in the UK do not realise that under both Spanish & UK law, they are required to pay CGT on the sale of it.
The Uk tax authorities announced last month that they are going to investigate all property sales over the last 20 years with a view to recovering unpaid CGT.

A UK citizen can mitigate the CGT under UK tax law by selling their 'main' spanish residence 1st & then moving back into the UK one ( or vice-versa ) which then becomes the main residence. In addition UK law allows you 2 years from purchase of 2nd property to nominate which is 'main' residence & is used as a loophole by many to sell & take profits ,legally, whilst having to pay no CGT.

Under Spanish tax law this is not possible. Subject to allowances CGT is payable on anything, including your car if you sold it for more than paid.


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## mrypg9

cyclequeen said:


> Yikes Callie I won't sleep tonight now!!! I didn't think about that one, what the Spanish gov can take capital gains from our only house now it's sold, surely this can't be right. We bought our house over 20 years ago so you can imagine what we have made on it. I'm going to have to get some advice as you say because we won't be going to Spain if this is the case as the money we have made is to last us our lifetime.


I think you are worrying unnecessarily but maybe I've got the facts wrong...

Is this correct? You will receive a part share in a modestly priced UK house which will be sold to give you your share. You wish to invest the capital you receive from this sale in a UK bank or other institution and receive income from it in Spain.

If that is the case you must declare that capital asset and income derived therefrom in Spain. You are in the same position as we ourselves and many immigrants who sold UK property before coming to Spain, although we lived in Prague when our properties in the UK were sold.

Sorry if I've misunderstood...


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## mrypg9

JaneyO said:


> Yes that's true the individual offices and folks 'on the ground' are very helpful but the organisation as a whole has some very scary powers!


And you think HMRC hasn't!!!

May I ask....have you ever owned/run a business of any size in the UK?

The powers of HMRC are extensive and intrusive, as are those of many Ministeries of UK Government. Most employed working people are unaware of this as it rarely affects their everyday lives.


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## callie

cambio said:


> [/COLOR]
> 
> 
> If you sell in the UK move to Spain and buy a house you pay capital gains in Spain?


My understanding is that if you are a tax resident  in Spain then you should declare and pay tax (including capital gains) on ALL of your worldwide income for that tax year - which would include the 'profit' on the sale of a property anywhere in the world. As others have said, if one wishes to avoid this, then the wise thing to do is not to be a spanish tax resident in the year in which you sell a property ie. be there less than 183 days in the tax year - timing is all .


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## cyclequeen

OMG !!! I had no idea about all of this, seems daft now I know but naively thought it was similar to UK tax laws. Ok if I'm understanding correct we can avoid paying cgt on the sale of our house when we fill in our tax form next year for this year by not living in Spain for more than 183 days this year. Ok if it's as simple as that then yes we can get around that by coming home, as we intended anyway, at Xmas for a few weeks.? Yes it's true we have sold our house for less than £250.000 so will not be wealthy, but hoped to have enough to live on with our small pensions too. We don't intend to buy in Spain but rent, for at least the first year anyway.
I am currently googling tax advisors who speak English, anyone know of a good one please ?


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## JaneyO

mrypg9 said:


> And you think HMRC hasn't!!!
> 
> May I ask....have you ever owned/run a business of any size in the UK?
> 
> The powers of HMRC are extensive and intrusive, as are those of many Ministeries of UK Government. Most employed working people are unaware of this as it rarely affects their everyday lives.


No I haven't run a business but I did once work for HMRC and my father was a Chief Collector of Taxes most of his life so I do know something about it.


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## Megsmum

cyclequeen said:


> OMG !!! I had no idea about all of this, seems daft now I know but naively thought it was similar to UK tax laws. Ok if I'm understanding correct we can avoid paying cgt on the sale of our house when we fill in our tax form next year for this year by not living in Spain for more than 183 days this year. Ok if it's as simple as that then yes we can get around that by coming home, as we intended anyway, at Xmas for a few weeks.? Yes it's true we have sold our house for less than £250.000 so will not be wealthy, but hoped to have enough to live on with our small pensions too. We don't intend to buy in Spain but rent, for at least the first year anyway.
> I am currently googling tax advisors who speak English, anyone know of a good one please ?


You would have to come home for more than a few weeks to be non resident. 183 days is 6 months, or is it consecutive days???


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## extranjero

*Tax advisor*



cyclequeen said:


> OMG !!! I had no idea about all of this, seems daft now I know but naively thought it was similar to UK tax laws. Ok if I'm understanding correct we can avoid paying cgt on the sale of our house when we fill in our tax form next year for this year by not living in Spain for more than 183 days this year. Ok if it's as simple as that then yes we can get around that by coming home, as we intended anyway, at Xmas for a few weeks.? Yes it's true we have sold our house for less than £250.000 so will not be wealthy, but hoped to have enough to live on with our small pensions too. We don't intend to buy in Spain but rent, for at least the first year anyway.
> I am currently googling tax advisors who speak English, anyone know of a good one please ?


Carol fox at Danniells FOX-just google it


----------



## Calas felices

It's accumulative not consecutive.


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## chris&vicky

cyclequeen said:


> Hi Guys, hope you can ease my troubled mind
> We are coming to Spain in June this year with the aim to retire near to our Son, La Linea. We thought we had it all covered financially but now I'm worried I have missed something very important, tax ??
> We are 62 hubby & 56 me so he will be getting his state pension in 3 years me 10 !! thanks to the changes here in the UK. We will have the capital from the sale of our house & lump sums from cashed in pensions, plus very small pensions to live on. Question please, I thought that tax would be like here in the UK that is you only get taxed on the income you generate from your investments, ie interest on your savings. Not the capital itself, if this was the case we would struggle. I know that our individual allowance in the UK would not come to more than any interest we are likely to earn & our pensions, hence based on UK we would not be paying any tax at all. Can you tell me if they tax you on your capital you have made from your house in Spain please. We will be banking in Gibraltar, I know we have to declare this & any funds we may leave here in the UK, & a local Spanish bank.  :fingerscrossed:


There are so many people posting different views it is best to take professional advice. I have looked into this myself and I think you are liable for CGT if you sell your house in a year that you are tax resident in Spain (i.e living 6 months in Spain for the year). So if you come in June and sold in 2013 then you are liable for tax on any gain. 

Having said that you still may not pay anything, or little, depending on when you bought the house, and if you intend to reinvest any of the sale proceeds to buy a new property. If you bought before 1987 then you pay nothing. If you reinvest all the sale proceeds in a new house you pay nothing (you must then buy a new main residence within four years, starting two years before the sale). If you reinvest a percentage of the sale proceeds you pay a percentage. There are other scenarios, have a look at this ... Capital Gains Tax on Real Estate in Spain - AngloINFO Costa de la Luz, in the Costa de la Luz (Spain) .

Also you will pay tax in Spain on tax free lump sums if you took them in 2013.

That is how I see it, but take some advice. It may be better to delay your trip or take time out of Spain to avoid being tax resident for 2013.


----------



## mrypg9

cyclequeen said:


> OMG !!! I had no idea about all of this, seems daft now I know but naively thought it was similar to UK tax laws. Ok if I'm understanding correct we can avoid paying cgt on the sale of our house when we fill in our tax form next year for this year by not living in Spain for more than 183 days this year. Ok if it's as simple as that then yes we can get around that by coming home, as we intended anyway, at Xmas for a few weeks.? Yes it's true we have sold our house for less than £250.000 so will not be wealthy, but hoped to have enough to live on with our small pensions too. We don't intend to buy in Spain but rent, for at least the first year anyway.
> I am currently googling tax advisors who speak English, anyone know of a good one please ?


I'm beginning to think that masochism is becoming widespread amongst Britisah immigrants in Spain.. Some people do like creating alarm and confusion.

Sell this property in the UK, get the dosh, invest it...As you say, £250 k split three ways isn't megabucks, although I wouldn't turn it down if someone offered me
£80k.
Move to Spain, declare any income from investing this asset - it won't be much under current interest rates - and live happily.
This is not a major tax issue requiring spending on tax lawyers.


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## mrypg9

JaneyO said:


> No I haven't run a business but I did once work for HMRC and my father was a Chief Collector of Taxes most of his life so I do know something about it.


Then you will know that compared to Spain HMRC is hugely efficient -although they seem to be employing people nowadays we wouldn't have taken on as tea ladies. 

You will also know that their powers of entry and inspection are almost unlimited. HMRC can literally shut down a business overnight -in some cases quite rightly so, in others not.

It seems a lot of Government Departments are taking on staff on a semi=temporary basis, UK Border Agency being one example, I suspect HMRC another, considering the almost surreal element to my recent dealings with them.


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## Aron

callie said:


> My understanding is that if you are a tax resident  in Spain then you should declare and pay tax (including capital gains) on ALL of your worldwide income for that tax year - which would include the 'profit' on the sale of a property anywhere in the world. As others have said, if one wishes to avoid this, then the wise thing to do is not to be a spanish tax resident in the year in which you sell a property ie. be there less than 183 days in the tax year - timing is all .


Not any good to us, we only have a house in Spain. Having lived in Spain for about 9 years or so, the thought of spending 180 days in the UK fills me with dread.
You move to another country, you integrate and abide by their laws. I fail to see what all the fuss was about. Everyone is complaining about the tax issue, but no one I know wants to leave. I am a pensioner, Ican live a good life in Spain, but I wouldn't be able to afford living in the UK.


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## chris&vicky

Aron said:


> the thought of spending 180 days in the UK fills me with dread.
> .


A different view from many posting here. So many seem so keen to get out of Spain to return home. I think too long in the sun has made many forget what living permanently in the UK is really like. 

Freezing cold, trudging around in the mud on endless rainy days. £1,000's and £1,000's on heating bills trying to keep the house warm during the 9 month winter. Unaffordable housing. Extortionate Council Tax bills, hey it's great fun


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## xabiaxica

chris&vicky said:


> *A different view from many posting here. So many seem so keen to get out of Spain to return hom*e. I think too long in the sun has made many forget what living permanently in the UK is really like.
> 
> Freezing cold, trudging around in the mud on endless rainy days. £1,000's and £1,000's on heating bills trying to keep the house warm during the 9 month winter. Unaffordable housing. Extortionate Council Tax bills, hey it's great fun


really???

are we on the same forum??

one or two here are keen to return for one reason or another, but the majority of posters on this forum are perfectly happy & settled here - & jojo my co-mod would be back here permanently in a heartbeat if she could swing it!!


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## chris&vicky

xabiachica said:


> really???
> 
> are we on the same forum??
> 
> one or two here are keen to return for one reason or another, but the majority of posters on this forum are perfectly happy & settled here - & jojo my co-mod would be back here permanently in a heartbeat if she could swing it!!


It is probably me being a bit paranoid I only retain the negative posts as moving soon and am a born worrier


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## Pesky Wesky

chris&vicky said:


> A different view from many posting here. So many seem so keen to get out of Spain to return home. I think too long in the sun has made many forget what living permanently in the UK is really like.


Who, what, where?!?
I can think of someone who may move on because of the new tax laws, another who really dislikes the region they are in and has some financial issues and..., and...???

One of the reasons I joined this forum was that people were very positive about Spain and living here. There are other forums that read like complaints books.


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## xabiaxica

chris&vicky said:


> It is probably me being a bit paranoid I only retain the negative posts as moving soon and am a born worrier


ahhhh that explains it!!


you'll be fine, I'm sure - & if not we're all here for you to sound off at!!


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## gus-lopez

183 days is the 2nd July .err on side of caution & come a bit later. Then you won't have to declare next year for this year.
Yes, various posters are espousing varying views but unfortunately I know of people using at least 7 different asesorias & all have different views about modelo 720, pensions,income amounts, you name it there is different advice. Many struggle with spanish tax law let alone English !


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## gus-lopez

Pesky Wesky said:


> Who, what, where?!?
> I can think of someone who may move on because of the new tax laws, another who really dislikes the region they are in and has some financial issues and..., and...???
> 
> One of the reasons I joined this forum was that people were very positive about Spain and living here. There are other forums that read like complaints books.


I'm Happy ! ish.


----------



## baldilocks

Aron said:


> Not any good to us, we only have a house in Spain. Having lived in Spain for about 9 years or so, the thought of spending 180 days in the UK fills me with dread.
> *You move to another country, you integrate and abide by their laws. *I fail to see what all the fuss was about. Everyone is complaining about the tax issue, but no one I know wants to leave. I am a pensioner, Ican live a good life in Spain, but I wouldn't be able to afford living in the UK.


Quite! So many of those expats/immigrants who think it will be quite OK to avoid paying their due taxes and generally cheating the system here in Spain would be among the first to complain about people doing it where they came from, be it UK, US or elsewhere


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## mrypg9

Aron said:


> Not any good to us, we only have a house in Spain. Having lived in Spain for about 9 years or so, the thought of spending 180 days in the UK fills me with dread.
> You move to another country, you integrate and abide by their laws. I fail to see what all the fuss was about. Everyone is complaining about the tax issue, but no one I know wants to leave. I am a pensioner, Ican live a good life in Spain, but I wouldn't be able to afford living in the UK.


That says it all, Aron. Anyone would think we had a load of Roman Abramoviches here in Spain. You move, you obey the Spanish laws, you try to fit in and get on with people. I can understand people wanting to keep as much of their hard-earned money as possible but at a time when yields on investments are negligible we're not talking thousands of tax due , certainly not on the average British pensioner immigrant's income.

Any tax paid is imo well worth being able to eat lunch by our pool in the third week of April or even earlier whilst listening to tales of snowbound Britain on the radio.
Life is for living and enjoying, especially when you're at retirement age. If moving to Sp[ain is causing worries over money, cost of bills etc.: you probably can't afford it and would be better off in the UK, especially if you receive other benefits in addition to your State Pension which you won't get in Spain.


----------



## baldilocks

mrypg9 said:


> whilst listening to tales of snowbound Britain


Or tales from Baldi of snowbound Jaén...


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## Tilley

cyclequeen said:


> OMG !!! I had no idea about all of this, seems daft now I know but naively thought it was similar to UK tax laws. Ok if I'm understanding correct we can avoid paying cgt on the sale of our house when we fill in our tax form next year for this year by not living in Spain for more than 183 days this year. Ok if it's as simple as that then yes we can get around that by coming home, as we intended anyway, at Xmas for a few weeks.? Yes it's true we have sold our house for less than £250.000 so will not be wealthy, but hoped to have enough to live on with our small pensions too. We don't intend to buy in Spain but rent, for at least the first year anyway.
> I am currently googling tax advisors who speak English, anyone know of a good one please ?


Haven't read all the thread so apologies if this has already been said.

My understanding is if you sell your one and only property in the UK you get up to four years to purchase a property in Spain.

However if you intend to rent indefinately in Spain and be a tax resident, then you pay capital gains tax on the sale of the UK house to the Spanish Authorities.


----------



## Megsmum

Aron said:


> Not any good to us, we only have a house in Spain. Having lived in Spain for about 9 years or so, the thought of spending 180 days in the UK fills me with dread.
> You move to another country, you integrate and abide by their laws. I fail to see what all the fuss was about. Everyone is complaining about the tax issue, but no one I know wants to leave. I am a pensioner, Ican live a good life in Spain, but I wouldn't be able to afford living in the UK.




I totally agree however for me the issue is not about "not paying" etc its about understanding.

I have done loads of research and missed this one. We are hoping to sell in the UK this year, and move next however we may not sell untill January ect, and therefore not resident in Spain until midway through 2014. For me its about understanding the facts as best I can, ensure that we have sufficient funds to live in Spain, no point in selling here, like the lady before taking her 250K and then being hit with a 26% bill on that amount.

I am going to take "legal" advice because I have been told various things about CGT on selling your house in the UK and then become resident in Spain in the same year. Although we will be using approx 38% of the sale on a property the rest will be shoved in the bank - a CGT of 28% off if the remaining is a hit on our long term savings. I thought naively that you paid tax on the "income" part of the investment not the whole amount. So while this will not change our minds it is something we have to be mindful of


----------



## Tilley

cambio said:


> I totally agree however for me the issue is not about "not paying" etc its about understanding.
> 
> I have done loads of research and missed this one. We are hoping to sell in the UK this year, and move next however we may not sell untill January ect, and therefore not resident in Spain until midway through 2014. For me its about understanding the facts as best I can, ensure that we have sufficient funds to live in Spain, no point in selling here, like the lady before taking her 250K and then being hit with a 26% bill on that amount.
> 
> I am going to take "legal" advice because I have been told various things about CGT on selling your house in the UK and then become resident in Spain in the same year. Although we will be using approx 38% of the sale on a property the rest will be shoved in the bank - a CGT of 28% off if the remaining is a hit on our long term savings. I thought naively that you paid tax on the "income" part of the investment not the whole amount. So while this will not change our minds it is something we have to be mindful of


You might be better off renting out your UK property and doing long term renting in Spain, then you would only be taxed on your rental income rather than any capital gains.


----------



## chris&vicky

Tilley said:


> You might be better off renting out your UK property and doing long term renting in Spain, then you would only be taxed on your rental income rather than any capital gains.


That is what I am doing although I may buy in a few years. My view is that as I will reinvest at least 80% in a property after I sell so will pay CGT on only 80% of my gain. As uk property prices are stable, maybe even on the way up, and spanish prices still on the way down the GGT will be more than offset by the capital gain. You have to look at the big picture.


----------



## Megsmum

chris&vicky said:


> That is what I am doing although I may buy in a few years. My view is that as I will reinvest at least 80% in a property after I sell so will pay CGT on only 80% of my gain. As uk property prices are stable, maybe even on the way up, and spanish prices still on the way down the GGT will be more than offset by the capital gain. You have to look at the big picture.


except that only works if your house is good to rent, our house is to rural and although in a lovely location not an area for rental income. 


We will hopefully sell this year and move net, if not we will either have to take the tax into account or move over and rent which is what we were going to do, come home for a while and the go back and rent again untill we buy past the july deadline 
I am sure one way or another it will all come out in the washxx


----------



## cyclequeen

mrypg9 said:


> I'm beginning to think that masochism is becoming widespread amongst Britisah immigrants in Spain.. Some people do like creating alarm and confusion.
> 
> Sell this property in the UK, get the dosh, invest it...As you say, £250 k split three ways isn't megabucks, although I wouldn't turn it down if someone offered me
> £80k.
> Move to Spain, declare any income from investing this asset - it won't be much under current interest rates - and live happily.
> This is not a major tax issue requiring spending on tax lawyers.


It's to be split two ways my husband & I only, we are moving near to our son but not giving him a share, If you are right then this is how I imagined it to be, only paying tax on any interest earned on our actual investment, not paying tax on the investment itself as if we had worked & earned that money that year.


----------



## cyclequeen

baldilocks said:


> Quite! So many of those expats/immigrants who think it will be quite OK to avoid paying their due taxes and generally cheating the system here in Spain would be among the first to complain about people doing it where they came from, be it UK, US or elsewhere


But my point is that I don't mind paying tax if we go over the individual allowance that's fine we want to do things properly & above board. So it's not a case of trying to avoid paying our way, but the point is we cannot surely be expected to pay cgt on our house sold in the uk to fund our new life in Spain. This will stop many people like us moving over there, unless you are mega rich & it doesn't matter, but an ordinary person with modest means, Paying tax on the income earned from our lump sum is fine & I expected we may have to do that. But paying tax on the sale of our house as if it was money earned in that tax year will stop us from coming.


----------



## chris&vicky

cyclequeen said:


> It's to be split two ways my husband & I only, we are moving near to our son but not giving him a share, If you are right then this is how I imagined it to be, only paying tax on any interest earned on our actual investment, not paying tax on the investment itself as if we had worked & earned that money that year.


If you sell any house anywhere in a year you are tax resident in Spain you pay tax in Spain on any gain you made from when you bought the house. You do get allowances if it is your main residence that you are selling as previously posted. 

I think I must be missing something when you say "not paying tax on the investment", you pay CGT on any gain. You pay interest on any savings or investments.


----------



## Megsmum

cyclequeen said:


> But my point is that I don't mind paying tax if we go over the individual allowance that's fine we want to do things properly & above board. So it's not a case of trying to avoid paying our way, but the point is we cannot surely be expected to pay cgt on our house sold in the uk to fund our new life in Spain. This will stop many people like us moving over there, unless you are mega rich & it doesn't matter, but an ordinary person with modest means, Paying tax on the income earned from our lump sum is fine & I expected we may have to do that. But paying tax on the sale of our house as if it was money earned in that tax year will stop us from coming.


Although it will not stop us coming I have to agree




chris&vicky said:


> If you sell any house anywhere in a year you are tax resident in Spain you pay tax in Spain on any gain you made from when you bought the house. You do get allowances if it is your main residence that you are selling as previously posted.
> 
> I think I must be missing something when you say "not paying tax on the investment", you pay CGT on any gain. You pay interest on any savings or investments.


I think the OP like me is saying that we thought rightly or wrongly that

you buy house in uk 150k
you sell house in uk 250k

total gain 100k invest 100k in bank pay tax on any " interest" earned

however what is coming across and what I understand to be true now is

you buy house in uk 150k
you sell house in uk 250k

Total gain 100K

CGT paid on 100K at 26% = 20+K Tax paid to Spain

OR

As above but

buy house in Spain for 50K
Pay CTG on remaining 50K

IF all the above takes place in the year you become resident.

This is the first mention on "allowances" if the house in the UK was your main residence, where do I find out about "allowances re CGT in Spain on the sale of a UK Property?

Its all good fun is it not


----------



## CapnBilly

This is quite a good article. It claims to be based on information from Bevins Franks. It contains information on the circumstances being discussed here. The information is more or less my understanding.

http://spain.angloinfo.com/money/general-taxes/capital-gains-tax/


----------



## chris&vicky

cambio said:


> cyclequeen said:
> 
> 
> 
> But my point is that I don't mind paying tax if we go over the individual allowance that's fine we want to do things properly & above board. So it's not a case of trying to avoid paying our way, but the point is we cannot surely be expected to pay cgt on our house sold in the uk to fund our new life in Spain. This will stop many people like us moving over there, unless you are mega rich & it doesn't matter, but an ordinary person with modest means, Paying tax on the income earned from our lump sum is fine & I expected we may have to do that. But paying tax on the sale of our house as if it was money earned in that tax year will stop us from coming.
> 
> 
> 
> Although it will not stop us coming I have to agree
> 
> 
> 
> 
> I think the OP like me is saying that we thought rightly or wrongly that
> 
> you buy house in uk 150k
> you sell house in uk 250k
> 
> total gain 100k invest 100k in bank pay tax on any " interest" earned
> 
> however what is coming across and what I understand to be true now is
> 
> you buy house in uk 150k
> you sell house in uk 250k
> 
> Total gain 100K
> 
> CGT paid on 100K at 26% = 20+K Tax paid to Spain
> 
> OR
> 
> As above but
> 
> buy house in Spain for 50K
> Pay CTG on remaining 50K
> 
> IF all the above takes place in the year you become resident.
> 
> This is the first mention on "allowances" if the house in the UK was your main residence, where do I find out about "allowances re CGT in Spain on the sale of a UK Property?
> 
> Its all good fun is it not
Click to expand...

You may not have to pay any CGT. If you are over 65 you pay nothing. If you bought before 1987 you pay nothing. If you reinvest all the sale proceeds in a new house you pay nothing (you must buy a new main residence within four years, starting two years before the sale). If you reinvest a percentage of the sale proceeds you pay a percentage. There are other scenarios, have a look at this ... http://spain.angloinfo.com/money/general-taxes/capital-gains-tax/ .


----------



## Megsmum

chris&vicky said:


> cambio said:
> 
> 
> 
> You may not have to pay any CGT. If you are over 65 you pay nothing. If you bought before 1987 you pay nothing. If you reinvest all the sale proceeds in a new house you pay nothing (you must buy a new main residence within four years, starting two years before the sale). If you reinvest a percentage of the sale proceeds you pay a percentage. There are other scenarios, have a look at this ... Capital Gains Tax on Real Estate in Spain | AngloINFO Spain .
> 
> 
> 
> which i think pretty much sums up what i posted above. In reality its about the timing of the move. Sell and move in the same tax year pay CGT sell one year move next tax year no CGT.
> 
> Thanks guys another issue crossed off the list for now
Click to expand...


----------



## CapnBilly

chris&vicky said:


> ... http://spain.angloinfo.com/money/gen...tal-gains-tax/ .


Shall I just delete my post ?


----------



## chris&vicky

CapnBilly said:


> Shall I just delete my post ?


???????????????????????????????/


----------



## CapnBilly

chris&vicky said:


> ???????????????????????????????/


You just posted exactly the same link.


----------



## chris&vicky

CapnBilly said:


> You just posted exactly the same link.


I had no idea that you had posted it when I started my post. And actually if you check back a few pages I only reposted what I had posted earlier today so I could say the same to you.


----------



## cyclequeen

cambio said:


> chris&vicky said:
> 
> 
> 
> which i think pretty much sums up what i posted above. In reality its about the timing of the move. Sell and move in the same tax year pay CGT sell one year move next tax year no CGT.
> 
> Thanks guys another issue crossed off the list for now
> 
> 
> 
> Well we are going to get some professional advice now, but hope that the above is true as this is the route we intend to take now. We will still arrive in Spain 15th June, don't really want to change that date as this is complicated for a variety of reason. We have always intended to come home for Xmas anyway so will either just extend that trip to keep us within the 183 days limit for this tax year. Or maybe take a trip to Morocco or Portugal for the same reason
> Either way we have stopped panicking now & are still coming to Spain, next year we will have to think again once we get close to the 183 days about if we want to really settle there. We know we need to be there at least a year anyway, this will give us this approx, then decide stay & become tax resident or go. That way we will not be liable for cgt, if the above post is correct.:clap2:
Click to expand...


----------



## extranjero

*Cgt*



cambio said:


> chris&vicky said:
> 
> 
> 
> which i think pretty much sums up what i posted above. In reality its about the timing of the move. Sell and move in the same tax year pay CGT sell one year move next tax year no CGT.
> 
> Thanks guys another issue crossed off the list for now
> 
> 
> 
> I would be willing to bet that most ex pats are not aware of this, and did not even consider timing when they moved to Spain, thus unaware if they owed any CGT to the Spanish tax office
> What if they sold in UK, moved a few months later, then obtained residencia the following year?
Click to expand...


----------



## chris&vicky

extranjero said:


> cambio said:
> 
> 
> 
> What if they sold in UK, moved a few months later, then obtained residencia the following year?
> 
> 
> 
> It is not residencia, there is no such thing now as residencia, it is tax residency. You automatically become tax resident if you spend 183+ days in Spain in a calendar year.
Click to expand...


----------



## extranjero

*tax*



chris&vicky said:


> extranjero said:
> 
> 
> 
> You do not obtain tax residency, you become tax resident if you spend 183+ days in Spain in a calendar year.
> 
> 
> 
> I am talking about the residencia as it was then called
Click to expand...


----------



## chris&vicky

extranjero said:


> I am talking about the residencia as it was then called


Sorry, but I thought residencia, as it was called, and being tax resident were different things. You are tax resident in Spain after 183 days even if after 90 days you fail to register for a residents permit.


----------



## Pesky Wesky

I'm going to butt in here on your disagreement.
You are given a certificate to say that you have registered on the Citizens of the EU Register.
No residencia/ residents permit or otherwise, just a certificate of registration.


----------



## chris&vicky

Pesky Wesky said:


> I'm going to butt in here on your disagreement.
> You are given a certificate to say that you have registered on the Citizens of the EU Register.
> No residencia/ residents permit or otherwise, just a certificate of registration.


I agree with you on that but all I was trying to say is that it has nothing to do with being tax resident.


----------



## Pesky Wesky

chris&vicky said:


> I agree with you on that but all I was trying to say is that it has nothing to do with being tax resident.


Yes, I'm just concentrating on the use of the word residencia, which should not be used, at least when talking about people from the UK emigrating to Spain. That's all


----------



## chris&vicky

Pesky Wesky said:


> Yes, I'm just concentrating on the use of the word residencia, which should not be used, at least when talking about people from the UK emigrating to Spain. That's all


Understood  

I know we are going a little off topic but can I ask a question that I did not fully understand the answer to when it was raised elsewhere?

To register it says on another forum

"you must provide proof that you have health insurance with coverage in Spain"

I assume that is only if you do not qualify for Spanish health care by being in receipt of a UK pension. I do not qualify for Spanish health care yet but I do get about 2 years cover with an S1 form, does that satisfy the requirements for now?


----------



## xabiaxica

chris&vicky said:


> Understood
> 
> I know we are going a little off topic but can I ask a question that I did not fully understand the answer to when it was raised elsewhere?
> 
> To register it says on another forum
> 
> "you must provide proof that you have health insurance with coverage in Spain"
> 
> I assume that is only if you do not qualify for Spanish health care by being in receipt of a UK pension. I do not qualify for Spanish health care yet but I do get about 2 years cover with an S1 form, does that satisfy the requirements for now?


yes it does


----------



## mrypg9

chris&vicky said:


> I think I must be missing something when you say "not paying tax on the investment", you pay CGT on any gain. You pay interest on any savings or investments.


No you don't, you normally pay interest on income not capitalfrom which that income derives.
We sold a house which was our main residence in the UK and invested the proceeds as we didn't use them to purchase another property. No CGT, but tax payable on interest derived therefrom.
So for the OP it's simply a matter of timing. The house will not be subject to IT as it falls below the IT threshhold. 
The issue will be what period does the 183 day rule cover.
So...is the OP now resident permanently in Spain?


----------



## chris&vicky

mrypg9 said:


> No you don't, you normally pay interest on income not capitalfrom which that income derives.
> We sold a house which was our main residence in the UK and invested the proceeds as we didn't use them to purchase another property. No CGT, but tax payable on interest derived therefrom.
> So for the OP it's simply a matter of timing. The house will not be subject to IT as it falls below the IT threshhold.
> The issue will be what period does the 183 day rule cover.
> So...is the OP now resident permanently in Spain?


I am not sure I exactly follow what you say, no you don't what? You do pay interest on any investment income (interest received from the proceeds when invested), and your house, even if it is your main residence, is subject to CGT with certain allowances depending on a number of factors, like age, amount reinvested, date purchased, etc.


----------



## Megsmum

TE]



mrypg9 said:


> No you don't, you normally pay interest on income not capitalfrom which that income derives.
> We sold a house which was our main residence in the UK and invested the proceeds as we didn't use them to purchase another property. No CGT, but tax payable on interest derived therefrom.
> So for the OP it's simply a matter of timing. The house will not be subject to IT as it falls below the IT threshhold.
> The issue will be what period does the 183 day rule cover.
> So...is the OP now resident permanently in Spain?


Sorry mrypg9 but I am now even more confused and i thought i had this sussed

we are selling our house in UK (main and only ) residence - according to others here and what I have read we will be subject to Capital Gains Tax on the Gain we make between buying the house in 2002 and selling in 2013. If we buy a house in Spain and invest half the money in the bank we are taxed on the interest gained from what is left of the capital gain so if we do not buy house we pay on say 200k if we buy for 100k we pay on 100k. You are saying this is not the case

What is IT and what is the threshold - sorry I think you are Mary but noe sure


----------



## chris&vicky

cambio said:


> TE]
> 
> 
> 
> If we buy a house in Spain and invest half the money in the bank we are taxed on the interest gained from what is left of the capital gain so if we do not buy house we pay on say 200k if we buy for 100k we pay on 100k. You are saying this is not the case
> 
> What is IT and what is the threshold - sorry I think you are Mary but noe sure


You are taxed on all interest regardless of where the capital originated from. But you would have been taxed on it in the UK anyway.

The second bit is not quite right. If you sold for £200k and reinvest £100k the you are taxed on 50% of your gain, so it depends what your gain was.

There are other possible allowances which you can read on this page for which the link has been posted many times Capital Gains Tax on Real Estate in Spain | AngloINFO Spain


----------



## Aron

cambio said:


> TE]
> 
> 
> 
> Sorry mrypg9 but I am now even more confused and i thought i had this sussed
> 
> we are selling our house in UK (main and only ) residence - according to others here and what I have read we will be subject to Capital Gains Tax on the Gain we make between buying the house in 2002 and selling in 2013. If we buy a house in Spain and invest half the money in the bank we are taxed on the interest gained from what is left of the capital gain so if we do not buy house we pay on say 200k if we buy for 100k we pay on 100k. You are saying this is not the case
> 
> What is IT and what is the threshold - sorry I think you are Mary but noe sure


There is no need to get confused, as I said on an earlier post, get professional advice rather than people who think they know. If you are moving to Spain, ask your Abogado, they should be able to give you clear and concise advice.


----------



## gus-lopez

Aron said:


> If you are moving to Spain, ask your Abogado, they should be able to give you clear and concise advice.




Now we are in the realms of Dreamland !


----------



## Megsmum

Aron said:


> There is no need to get confused, as I said on an earlier post, get professional advice rather than people who think they know. If you are moving to Spain, ask your Abogado, they should be able to give you clear and concise advice.


Already on the case - but we have to establish the time scales etc



chris&vicky said:


> You are taxed on all interest regardless of where the capital originated from. But you would have been taxed on it in the UK anyway.
> 
> The second bit is not quite right. If you sold for £200k and reinvest £100k the you are taxed on 50% of your gain, so it depends what your gain was.
> 
> There are other possible allowances which you can read on this page for which the link has been posted many times Capital Gains Tax on Real Estate in Spain | AngloINFO Spain


Thanks I know tax is paid on any interest on any capital where ever it comes from, followed the link read a few times and still feel stupid, but as far as we can see the only way to be sure is when we sell to ensure we do not spend more than 183 days in spain

if the gain is 160K and buy for 100K we are taxed on the 60K left?



gus-lopez said:


> Now we are in the realms of Dreamland !


----------



## Aron

gus-lopez said:


> Now we are in the realms of Dreamland !


People come on here for advice. The person in question said they were confused. There is no reason to be confused. However, answer such as that are really unhelpful. If the person is confused it may be because they have received conflicting advice. 
Every time I needed serious advice, I contacted my Abogado. I have never regretted any advice given!


----------



## gus-lopez

My understanding is that you can roll over " the whole amount" into a new property but if you don't, it doesn't actually say that you are taxed only on the remaining amount .

Slightly off-topic but along the same vein: Many Uk buyers purchased in Spain by re-mortgaging there UK property.What is the situation with that in relation to CGT when you sell the UK property ? I know of one couple who have taken advice from at least 10 abogados re; the spanish side of it & have no 2 replies the same.


----------



## CapnBilly

Aron said:


> If you are moving to Spain, ask your Abogado, they should be able to give you clear and concise advice.


Have you actually read through this thread about some of the advice received by abogados. I personally have received advice from different abogados that is the direct opposite. I agree with Gus

:rofl::rofl::rofl::rofl::rofl::rofl::rofl:


----------



## Pesky Wesky

Aron said:


> There is no need to get confused, as I said on an earlier post, get professional advice rather than people who think they know. If you are moving to Spain, ask your Abogado, they should be able to give you clear and concise advice.


Whereas I agree you should always ask a professional, many rules and laws are being pushed through by the government by Royal Decree. Apparently there have never been so many as those passed by the present government. Therefore many of the laws are new, they are not clear and they are open to interpretation, so in practise, as born out by many on the forum, you will not get "clear and concise" advice.
Personally I would get any advice from a lawyer in writing, on headed paper, dated and stamped if possible.


----------



## gus-lopez

Aron said:


> People come on here for advice. The person in question said they were confused. There is no reason to be confused. However, answer such as that are really unhelpful. If the person is confused it may be because they have received conflicting advice.
> Every time I needed serious advice, I contacted my Abogado. I have never regretted any advice given!


It is not unhelpful here,it is a statement of fact. No two have ever given the same answer to questions ranging form building works, house legalities , legal aspects of trailer legislation, to my Spanish neighbours divorce !! To the extent that over the last 11 years I would not personally trust a word that any one of them said without investigating the whole lot myself, which in itself defeats the object of asking & paying an abogado.
You have obviously got a good one !


----------



## Megsmum

What fascinates me is that this has never been mentioned anywhere in the general things to watch out for when moving to Spain, the usual don't forget you have to prove income and healthcare etc, from now on I will always say ensure you know you pay CGT to Spain on your house sale in the UK, fairly important note. I have done so much research and missed this little gem somewhere along the line. This is not about not paying because if you have to pay and thems the rules then so be it, but if holding off being tax resident for a bit longer means we keep the money in the bank then that's what we will do. Therefore I am intrigued as to how many Brits who have sold in the UK and moved to Spain have paid CGT on the gain that they made, because if you have moved in the past 10-15 years odds are your UK house increased in value between buying and selling

I am glad I spotted this - we were hoping to shove just over 30% of our gain in the bank using 70% for house purchase - a tax hit of 26% on that would have been an issue for us. Happy and know we have to pay any taxes due on income from that investment etc. 

We are still moving but are now going to have to ensure that we are not spending more than 183 days in Spain during 2014 to make sure we are not deemed tax resident.


----------



## Aron

CapnBilly said:


> Have you actually read through this thread about some of the advice received by abogados. I personally have received advice from different abogados that is the direct opposite. I agree with Gus
> 
> :rofl::rofl::rofl::rofl::rofl::rofl::rofl:


I have been in Spain almost 9 years. I have only had one Abogado. They have been excellent in every dealing I've had. Perhaps we were lucky, perhaps we just selected the best. 
So, instead of being critical to me, perhaps you can be constructive to the person who is confused, but please, they have obviously had conflicting views and need reassurance!


----------



## chris&vicky

cambio said:


> What fascinates me is that this has never been mentioned anywhere in the general things to watch out for when moving to Spain, the usual don't forget you have to prove income and healthcare etc, from now on I will always say ensure you know you pay CGT to Spain on your house sale in the UK, fairly important note. I have done so much research and missed this little gem somewhere along the line. This is not about not paying because if you have to pay and thems the rules then so be it, but if holding off being tax resident for a bit longer means we keep the money in the bank then that's what we will do. Therefore I am intrigued as to how many Brits who have sold in the UK and moved to Spain have paid CGT on the gain that they made, because if you have moved in the past 10-15 years odds are your UK house increased in value between buying and selling
> 
> I am glad I spotted this - we were hoping to shove just over 30% of our gain in the bank using 70% for house purchase - a tax hit of 26% on that would have been an issue for us. Happy and know we have to pay any taxes due on income from that investment etc.
> 
> We are still moving but are now going to have to ensure that we are not spending more than 183 days in Spain during 2014 to make sure we are not deemed tax resident.


The tax may not be that much if you are reinvesting 70% in a new home, of course that depends on the gain. It is only 26% of 30% of the gain. If you can avoid it all by timing your move, better still. 

I think the GCT law in Spain on selling your home is fairly clear, but if you are not sure then for piece of mind get professional advice. 

It's not worth losing any sleep over, it just something to budget for. The way house prices in Spain are dropping by the time you buy you will have saved the tax many times over.


----------



## Pesky Wesky

cambio said:


> What fascinates me is that this has never been mentioned anywhere in the general things to watch out for when moving to Spain, the usual don't forget you have to prove income and healthcare etc, .


Well, it's a new tax, isn't it?


----------



## snikpoh

Pesky Wesky said:


> Well, it's a new tax, isn't it?


I thought it had been around for ages!

I thought I too understood all of this but having read and re-read the thread, I am now more confused than ever.

Some examples to help clarify things (for me anyway);

If I sell a property for 500k, pay off the 100k mortgage and deduct the 100k initial cost, then I have made a gain of 300k. 
If I purchase a property in Spain now, then it is the whole 400k (sale minus mortgage) that needs to be re-invested or I will have to pay a percentage as mentioned above
I did not think that CGT was payable in Spain unless I was a tax resident in the same tax year that I sold it?

Any thoughts?


----------



## CapnBilly

Aron said:


> I have been in Spain almost 9 years. I have only had one Abogado. They have been excellent in every dealing I've had. Perhaps we were lucky, perhaps we just selected the best.
> So, instead of being critical to me, perhaps you can be constructive to the person who is confused, but please, they have obviously had conflicting views and need reassurance!


I agree if you have a good one then its okay, but as I say there are lots of examples of conflicting advice. I could point you to an Abogado site where people can ask questions. Great site you may think. However, if you read through the questions over a period of time with regard to IHT and CG from assets in the UK, you will find two years ago the answer was to ignore it. However, that has now changed, and the answer is that it is declarable.


----------



## CapnBilly

snikpoh said:


> [*]If I sell a property for 500k, pay off the 100k mortgage and deduct the 100k initial cost, then I have made a gain of 300k.


 Correct



snikpoh said:


> [*]If I purchase a property in Spain now, then it is the whole 400k (sale minus mortgage) that needs to be re-invested or I will have to pay a percentage as mentioned above


 Correct



snikpoh said:


> [*]I did not think that CGT was payable in Spain unless I was a tax resident in the same tax year that I sold it?


 Correct

This is from the Blevins site

The relief is based on the proportion of the total sales proceeds reinvested in the new home. If it costs more than the net sale price of the old home, the full gain is exempt. If only half of the sale proceeds are reinvested, then only half of the gain is exempt and the other half is taxable in the year of sale.

If the Spanish property costs less than the amount you received from the sale of your UK property, you will be charged tax in Spain on a proportion of the gain equivalent to the sale proceeds not reinvested.


----------



## CapnBilly

cambio said:


> What fascinates me is that this has never been mentioned anywhere in the general things to watch out for when moving to Spain, the usual don't forget you have to prove income and healthcare etc, from now on I will always say ensure you know you pay CGT to Spain on your house sale in the UK, fairly important note. I have done so much research and missed this little gem somewhere along the line. This is not about not paying because if you have to pay and thems the rules then so be it, but if holding off being tax resident for a bit longer means we keep the money in the bank then that's what we will do. Therefore I am intrigued as to how many Brits who have sold in the UK and moved to Spain have paid CGT on the gain that they made, because if you have moved in the past 10-15 years odds are your UK house increased in value between buying and selling
> 
> I am glad I spotted this - we were hoping to shove just over 30% of our gain in the bank using 70% for house purchase - a tax hit of 26% on that would have been an issue for us. Happy and know we have to pay any taxes due on income from that investment etc.
> 
> We are still moving but are now going to have to ensure that we are not spending more than 183 days in Spain during 2014 to make sure we are not deemed tax resident.


I think the reason for this is quite simple. The new asset declaration law has focused minds on something that has always been declarable and payable, but people haven't bothered. This is in the main has been caused by the professional ( and other) communities advising people not to bother declaring it. It was pretty normal upto last year for people to be advised not to bother declaring Inheritances and capital gains in the UK. I have given examples before of written answers to questions I have seen about this on lawyers site. 

Now, following the asset declaration requirements, and in particular the horrendous fines for non declaration, the professionals advice has changed and people minds are more focused on the fact that they are declarable and taxable, and if you don't declare them, and are subsequently discovered, then it will cost you plenty.

I would say this has only started being discussed in the last 3 months. Before, as you say, there was no discussion, for the reasons above.


----------



## chris&vicky

CapnBilly said:


> I think the reason for this is quite simple. The new asset declaration law has focused minds on something that has always been declarable and payable, but people haven't bothered. This is in the main has been caused by the professional ( and other) communities advising people not to bother declaring it. It was pretty normal upto last year for people to be advised not to bother declaring Inheritances and capital gains in the UK. I have given examples before of written answers to questions I have seen about this on lawyers site.
> 
> Now, following the asset declaration requirements, and in particular the horrendous fines for non declaration, the professionals advice has changed and people minds are more focused on the fact that they are declarable and taxable, and if you don't declare them, and are subsequently discovered, then it will cost you plenty.
> 
> I would say this has only started being discussed in the last 3 months. Before, as you say, there was no discussion, for the reasons above.


Nail hit firmly on the head! The can't really blame them for trying to get the taxes due paid though can you?


----------



## Megsmum

Pesky Wesky said:


> Well, it's a new tax, isn't it?


nope this has been a tax in spain for years



snikpoh said:


> I thought it had been around for ages!
> 
> I thought I too understood all of this but having read and re-read the thread, I am now more confused than ever.
> 
> Some examples to help clarify things (for me anyway);
> 
> If I sell a property for 500k, pay off the 100k mortgage and deduct the 100k initial cost, then I have made a gain of 300k.
> If I purchase a property in Spain now, then it is the whole 400k (sale minus mortgage) that needs to be re-invested or I will have to pay a percentage as mentioned above
> I did not think that CGT was payable in Spain unless I was a tax resident in the same tax year that I sold it?
> 
> Any thoughts?


agree



CapnBilly said:


> I think the reason for this is quite simple. The new asset declaration law has focused minds on something that has always been declarable and payable, but people haven't bothered. This is in the main has been caused by the professional ( and other) communities advising people not to bother declaring it. It was pretty normal upto last year for people to be advised not to bother declaring Inheritances and capital gains in the UK. I have given examples before of written answers to questions I have seen about this on lawyers site.
> 
> Now, following the asset declaration requirements, and in particular the horrendous fines for non declaration, the professionals advice has changed and people minds are more focused on the fact that they are declarable and taxable, and if you don't declare them, and are subsequently discovered, then it will cost you plenty.
> 
> I would say this has only started being discussed in the last 3 months. Before, as you say, there was no discussion, for the reasons above.


This is what i think as well...........interesting times for those who have tried to not pay or declare



chris&vicky said:


> Nail hit firmly on the head! The can't really blame them for trying to get the taxes due paid though can you?


Totally agree.........+ your other point about the timing - still coming though


----------



## agua642

Hi, ANyone know if an OAP selling house in UK which was bought 40 years ago! and now moving to Spain to rent has to pay CGT on property sold in UK?


----------



## chris&vicky

agua642 said:


> Hi, ANyone know if an OAP selling house in UK which was bought 40 years ago! and now moving to Spain to rent has to pay CGT on property sold in UK?


You would not pay any CGT if over 65 or if house bought before 1987,


----------



## gus-lopez

CapnBilly said:


> I think the reason for this is quite simple. The new asset declaration law has focused minds on something that has always been declarable and payable, but people haven't bothered. This is in the main has been caused by the professional ( and other) communities advising people not to bother declaring it. It was pretty normal upto last year for people to be advised not to bother declaring Inheritances and capital gains in the UK. I have given examples before of written answers to questions I have seen about this on lawyers site.
> 
> Now, following the asset declaration requirements, and in particular the horrendous fines for non declaration, the professionals advice has changed and people minds are more focused on the fact that they are declarable and taxable, and if you don't declare them, and are subsequently discovered, then it will cost you plenty.
> 
> I would say this has only started being discussed in the last 3 months. Before, as you say, there was no discussion, for the reasons above.



& that is what people have done in the UK also. So leading to the recent HMRC announcement that they are going to investigate every house sale over the last 20 years .


----------



## extranjero

*Cgt uk/spain*



gus-lopez said:


> & that is what people have done in the UK also. So leading to the recent HMRC announcement that they are going to investigate every house sale over the last 20 years .


if someone sells their UK house(main residence) moves to Spain in May, buys a house there they will be tax resident from May-December. When they sold their house before moving they were non resident of Spain. I could understand it if they moved to Spain in May, then sold their UK house in August. 
NO one could blame anyone for just staying put in the UK-Spain and its taxes are a nightmare.


----------



## mrypg9

extranjero;1154835NO one could blame anyone for just staying put in the UK-Spain and its taxes are a nightmare.[/QUOTE said:


> Most British immigrants are not wealthy. With interest rates at an all-time low and house prices dropping in the UK any tax payable would not be huge.
> 
> Any tax payable under Spanish rules has to be seen as an extra cost involved in a move. You weigh up your loss which may be a few £00 annually, if that in most cases, and decide how it weights the balance : a new life in a kinder climate with perhaps fewer bills, or grim winters and miserable summers in the UK.
> 
> Why are people so obsessed with these tax issues? Whatever we pay is imo well worth our lifestyle.


----------



## Calas felices

I suppose people become obsessed with whatever is most important to them. The 'expats' seem to be harping on about the tax because their weather is boring and predictable but also can't resist moaning about the weather they believe they left in the UK. By the way this weekend has been wonderful. dry, lots of sun and temperate.


----------



## chris&vicky

Calas felices said:


> I suppose people become obsessed with whatever is most important to them. The 'expats' seem to be harping on about the tax because their weather is boring and predictable but also can't resist moaning about the weather they believe they left in the UK. By the way this weekend has been wonderful. dry, lots of sun and temperate.


They believe they left in the UK? The weather in the UK is s**t, you get the odd few days where you can actually take your coat off!

I do not think the tax issue is about the weather, to some it could be a sizable amount of money. If you can reduce that burden by just timing your move correctly then that seems common sense.


----------



## Pesky Wesky

Calas felices said:


> I suppose people become obsessed with whatever is most important to them. The 'expats' seem to be harping on about the tax because their weather is boring and predictable but also can't resist moaning about the weather they believe they left in the UK. By the way this weekend has been wonderful. dry, lots of sun and temperate.


Boring and predictable?
I would beg to differ. Woke up to 5 -8 cms of snow last Monday, wearing flip flops now. 
Am not harping on about tax, nor weather...


----------



## agua642

Confirm: So if an OAP sells up his main residence ( only residence ) in UK which he bought 47 years ago in May 2013 and takes up full residence in Spain in rented accommodation in June 2013 he is not liable for CGT tax in Spain ?


----------



## chris&vicky

agua642 said:


> Confirm: So if an OAP sells up his main residence ( only residence ) in UK which he bought 47 years ago in May 2013 and takes up full residence in Spain in rented accommodation in June 2013 he is not liable for CGT tax in Spain ?


Correct according to this Capital Gains Tax on Real Estate in Spain | AngloINFO Spain .

It would be a good idea to take professional advice though as there is probably things you need to do to claim the relief or you could end up being taxed on it.


----------



## extranjero

*cgt*

Where does it mention selling property in UK before moving to Spain and any CGT on it?
It's all about selling property in SPAIN


----------



## chris&vicky

extranjero said:


> Where does it mention selling property in UK before moving to Spain and any CGT on it?
> It's all about selling property in SPAIN


It does not matter where you sell property. If tax resident in Spain you pay tax on your world wide income. So if this person moves to Spain in June 2013 they are tax resident in Spain for all of 2013. Living in Spain | Life in Spain


----------



## extranjero

*cgt*



chris&vicky said:


> It does not matter where you sell property. If tax resident in Spain you pay tax on your world wide income. So if this person moves to Spain in June 2013 they are tax resident in Spain for all of 2013. Living in Spain | Life in Spain


What if the UK property was bought before 1980 and sold in 2001?


----------



## chris&vicky

extranjero said:


> What if the UK property was bought before 1980 and sold in 2001?


The law now says if bought before 1986 if gets 100% relief, so therefore not taxable, if the relief is claimed. I have no idea what the law was in 2001 and it is probably not relevant now is it? It does not have to be declared as it is not an asset anymore.


----------



## agua642

I think u r correct a property that old is not declarable! I can't see many OAP bothering to declare assets that they have had for more then 40years.


----------



## extranjero

I meant declarable for cgt!


----------



## chris&vicky

agua642 said:


> I think u r correct a property that old is not declarable! I can't see many OAP bothering to declare assets that they have had for more then 40years.


I did not say it is not declarable, I just said you get 100% relief if bought before 1986. I do not know if you have to declare and claim the relief or not especially as I assume the person is over 65 ....

"The capital gains derived by residents (who have lived in their primary residence for more than three years) who are 65 years of age or older upon the transfer are exempt from tax."


----------



## extranjero

*cgt*



chris&vicky said:


> I did not say it is not declarable, I just said you get 100% relief if bought before 1986. I do not know if you have to declare and claim the relief or not especially as I assume the person is over 65 ....
> 
> "The capital gains derived by residents (who have lived in their primary residence for more than three years) who are 65 years of age or older upon the transfer are exempt from tax."


Even If the person is under 65 then surely the Tax relief is still 100%, as the law doesn't stipulate age if bought before 1986


----------



## chris&vicky

extranjero said:


> I meant declarable for cgt!


I am not sure what you mean? Surely world wide income includes capital gain?

I am sure you are liable for CGT in Spain on any property sold anywhere in the world if sold while tax resident in Spain. But if it is your main residence you may be entitled to allowances under the Spanish tax system.

I have a feeling in the past most expats ignored this, but it is a little more scary to ignore now with possible big fines.

If I have this all wrong I would love if if somebody could put me right, with some proof of that.


----------



## chris&vicky

extranjero said:


> Even If the person is under 65 then surely the Tax relief is still 100%, as the law doesn't stipulate age if bought before 1986


All I meant really was if over 65 you do not pay CGT, period. If bought before 1995 you claim relief, the relief becomes 100% on 31st December 1986. So you have to claim the relief.


----------



## Megsmum

mrypg9 said:


> Most British immigrants are not wealthy. With interest rates at an all-time low and house prices dropping in the UK any tax payable would not be huge.
> 
> Any tax payable under Spanish rules has to be seen as an extra cost involved in a move. You weigh up your loss which may be a few £00 annually, if that in most cases, and decide how it weights the balance : a new life in a kinder climate with perhaps fewer bills, or grim winters and miserable summers in the UK.
> 
> *Why are people so obsessed with these tax issues?* Whatever we pay is imo well worth our lifestyle.


I, being one of the people asking the question, are not obsessing about the tax issues - CGT on the sale of a UK property is not a few £00 per year it can work out at 15K plus which for some is a large sum of money. I am asking the question because I want to know what to expect and what I have to pay when I arrive. Otherwise if I cam on the forum 14 months from now questioning the bill for CGT everyone would be saying why did you not find this out before you move, or move at the right time to avoid paying. I agree it is a balance but you can only weigh up the balance if you have the knowledge



chris&vicky said:


> They believe they left in the UK? The weather in the UK is s**t, you get the odd few days where you can actually take your coat off!
> 
> I do not think the tax issue is about the weather, to some it could be a sizable amount of money. If you can reduce that burden by just timing your move correctly then that seems common sense.


Exactly - :clap2:


----------



## mrypg9

Forty-four pages on this...so obviously people are very concerned indeed. The new reporting requirement is even deterring some people from becoming immigrants, quite unnecessarily, imo. As I said in an earlier post, HMRC is sharing information with other tax authorities, Spain's being one, so tax issues will arise for some people wherever you go.

Unless I'm missing something here though the process is simple. If you are not yet resident in Spain and the house you are selling is your main residence you pay no CGT, unless there are complicating factors -i.e. you have left it empty for a long period or derived rental income from it, as many immigrants do -and I'm guessing very many don't declare this income to any taxman, whether Spanish or British..
You invest the money in the UK and then when resident in Spain declare the capital and income derived therefrom to Hacienda. Ditto if it's an inherited property below the tax valuation threshhold.

Surely no-one can be obliged to pay tax twice on the same income or capital gain.


----------



## Megsmum

mrypg9 said:


> Forty-four pages on this...so obviously people are very concerned indeed.
> 
> Unless I'm missing something here though the process is simple. If you are not yet resident in Spain and the house you are selling is your main residence you pay no CGT, unless there are complicating factors -i.e. you have left it empty for a long period or rented it
> You invest the money in the UK and then when resident in Spain declare the capital and income derived therefrom to Hacienda. Ditto if it's an inherited property below the tax valuation threshhold.
> 
> Surely no-one can be obliged to pay tax twice on the same income or capital gain.


well according to the links and what others have said given you are missing something - what you have said is what i thought - however it appears that you pay CGT on the difference between the purchase and sale - if you move to Spain and the sale of the house is in the same year that you become a tax resident . not sure how you think you are paying twice there is not CGT tax in the UK on main house


----------



## chris&vicky

mrypg9 said:


> Unless I'm missing something here though the process is simple. If you are not yet resident in Spain and the house you are selling is your main residence you pay no CGT, unless there are complicating factors -i.e. you have left it empty for a long period or derived rental income from it,
> 
> Surely no-one can be obliged to pay tax twice on the same income or capital gain.


True, the only thing that can catch you out is that when you become tax resident in Spain it is for the entire tax year. So you could be taxed on the gain from your UK house sale that was done before you even arrived in Spain.


----------



## agua642

Confused confused confused.com


----------



## mrypg9

agua642 said:


> Confused confused confused.com


And now something else for those of a timorous nature to worry about: former Chancellor Nigel Lawson has stated that the UK would be better off outside the EU. He has clout.

Cue pages of posts on the theme' Will we be kicked out of Spain if we join the EU'.

Cambio: I was merely restating the principle that no-one should be taxed twice, not applying it to a particular instance.

If people are so concerned about paying CGT in Spain the answer is simple: delay departure. I understand that for some people money is the most important factor. It would have been so for me in the past. Now I just enjoy what I have.


----------



## baldilocks

mrypg9 said:


> Cue pages of posts on the theme' Will we be kicked out of Spain if we *join* the EU'.


Did you mean "*leave*"? or are you getting confused as so many of the Daily Wail are, between, the EU and the Eurozone? If it is the latter, perhaps you need to be taking more G and less T


----------



## kurt85

chris&vicky said:


> I am not sure what you mean? Surely world wide income includes capital gain?
> 
> I am sure you are liable for CGT in Spain on any property sold anywhere in the world if sold while tax resident in Spain. But if it is your main residence you may be entitled to allowances under the Spanish tax system.
> 
> I have a feeling in the past most expats ignored this, but it is a little more scary to ignore now with possible big fines.
> 
> If I have this all wrong I would love if if somebody could put me right, with some proof of that.


------------------------------------------------------------------------------------------------------------

If anyone is in the Costa Del Sol area then i am more than happy to come and meet anyone for a coffee to clear up any of these matters.

Been here in Spain 15 years and just had to sort all this out myself,and ive worked in and out of the business for years and its still confusing! glad i didnt bury my head in the sand about it! Lots of things seem to be changing over here at the moment!

Fell free to message me to meet up for a coffee but the coffee is on you!haha


----------



## chris&vicky

kurt85 said:


> ------------------------------------------------------------------------------------------------------------
> 
> If anyone is in the Costa Del Sol area then i am more than happy to come and meet anyone for a coffee to clear up any of these matters.
> 
> Been here in Spain 15 years and just had to sort all this out myself,and ive worked in and out of the business for years and its still confusing! glad i didnt bury my head in the sand about it! Lots of things seem to be changing over here at the moment!
> 
> Fell free to message me to meet up for a coffee but the coffee is on you!haha


Will be in Churriana from 30th for a couple of weeks


----------



## kurt85

ocraz said:


> Hi I've just been Reading this thread and find it very interesting. I am from UK and living in Andalucia. I have been to see a hectoria who tells me I have to get oficial valuation for my property in England. I am retired and my children are living in my house in England. Would you know how I go about this? He said that an Estate Agent is not aceptable. Spain is really complicating the laws. Would appreciate any info you could help me with.


If youre close to the Marbella area, i can meet you for a coffee to explain all as i am doing with some other people who live in the area.I am in and out of the business,but i recently met up with a Spanish tax specialist so i can pass on what information he has given me.I wouldnt trust Estate Agents thats for sure!!

Kind Regards,

Kurt


----------



## kurt85

chris&vicky said:


> Will be in Churriana from 30th for a couple of weeks


----------------------------------------------------------------------------------------------------------

Well when its gets closer to the 30th send me a private message with your telephone number and ill give you a call to arrange a meeting place  otherwise ill forget!! 

Kind Regards,

Kurt


----------



## mrypg9

baldilocks said:


> Did you mean "*leave*"? or are you getting confused as so many of the Daily Wail are, between, the EU and the Eurozone? If it is the latter, perhaps you need to be taking more G and less T


Ah Baldy....I haven't had a G and T for months....on doctor's orders I am restricted to two cups of coffee and one glass of wine per day. Mind you, he didn't specify glass size...but I'm being sensible. I enjoy life here too much to risk it for caffeine and alcohol.

No, Lawson wants us out altogether. He will vote Out if it's straight in/out referendum.

But maybe I am enterimg my dotage...yesterday we set off to the CdS Hospital in Marbella for what I thought was an appointment there only to find I should have gone to the health centre in Estepona...Very stupid.
So finding ourselves in the vicinity of Marbella what could we do to retrieve a wasted journey but....go shopping.
Which we did and Sandra bought me two pairs of posh shoes including a flashy pair of Guess 'baseball boots' which I'm now wearing even though they were probably designed for people half a century younger.
But I don't give a damn


----------



## mrypg9

kurt85 said:


> ------------------------------------------------------------------------------------------------------------
> 
> If anyone is in the Costa Del Sol area then i am more than happy to come and meet anyone for a coffee to clear up any of these matters.
> 
> Been here in Spain 15 years and just had to sort all this out myself,and ive worked in and out of the business for years and its still confusing! glad i didnt bury my head in the sand about it! Lots of things seem to be changing over here at the moment!
> 
> Fell free to message me to meet up for a coffee but the coffee is on you!haha


Do you have any qualifications apart from experience which enables you to give sound advice?
I do agree with you about estate agents but I am wary of most people who proffer advice, however nice they may be,sad to say.


----------



## chris&vicky

kurt85 said:


> ----------------------------------------------------------------------------------------------------------
> 
> Well when its gets closer to the 30th send me a private message with your telephone number and ill give you a call to arrange a meeting place  otherwise ill forget!!
> 
> Kind Regards,
> 
> Kurt


Ok thanks.


----------



## kurt85

mrypg9 said:


> Do you have any qualifications apart from experience which enables you to give sound advice?
> I do agree with you about estate agents but I am wary of most people who proffer advice, however nice they may be,sad to say.



I have my qualifications through Morgan Stanley which was more in finance and investments than tax advice, but iv just lived here for a long time,been worrying about the tax declaration and met a spanish friend of mine thats in the business for the spanish government and he explained it all to me(slowly and clearly,my spanish is fluent,but i do still struggle when it comes to financial terms!) and i was just going to pass that info on.And i do understand,1st rule out here in Spain, be carefull who you trust.

Kind Regards,

Kurt


----------



## CapnBilly

kurt85 said:


> I have my qualifications through Morgan Stanley which was more in finance and investments than tax advice, but iv just lived here for a long time,been worrying about the tax declaration and met a spanish friend of mine thats in the business for the spanish government and he explained it all to me(slowly and clearly,my spanish is fluent,but i do still struggle when it comes to financial terms!) and i was just going to pass that info on.


Are you saying this is additional information to anything that has already been discussed, in which case, it would be better to share on the forum, so everyone can benefit.


----------



## xabiaxica

CapnBilly said:


> Are you saying this is additional information to anything that has already been discussed, in which case, it would be better to share on the forum, so everyone can benefit.


absolutely - that's what the forum is all about


----------



## mrypg9

My thoughts too..


----------



## IanB

Something more important to be announced in the Queen's Speech, drifted out in the news over the weekend. A spouse from 2016 will NOT be able to rely on their spouse's NI contributions to get a UK state pension. They will only get a pension in accordance with the contributions they themselves have made. Been unable to fill in much detail of the proposals so far but I think we can see which way the wind is beginning to blow. UKIP's 25% vote share is certainly causing additional concerns amongst the Establishment and the in evitable move to the Right I predicted is happening.

Yippee! seem able to post again.

regards


----------



## baldilocks

IanB said:


> Something more important to be announced in the Queen's Speech, drifted out in the news over the weekend. A spouse from 2016 will NOT be able to rely on their spouse's NI contributions to get a UK state pension. They will only get a pension in accordance with the contributions they themselves have made. Been unable to fill in much detail of the proposals so far but I think we can see which way the wind is beginning to blow. UKIP's 25% vote share is certainly causing additional concerns amongst the Establishment and the in evitable move to the Right I predicted is happening.
> 
> Yippee! seem able to post again.
> 
> regards


Wonder how that will work out with a widow's pension? Camoron and his mob are really trying to avoid giving up any of their perks!!


----------



## IanB

baldilocks said:


> Wonder how that will work out with a widow's pension? Camoron and his mob are really trying to avoid giving up any of their perks!!


I really don't know how it will work out, I suppose we will have to sit it out and see what the detailed proposals are. They have slipped an awful lot of bad things through in the small (very small) print recently. The interviews I managed to catch were expats in the Philippines and Thailand each with a Philippino and Thai wife respectively. Each was complaining that although they had the now required thirty years contributions in the pot, their wives under the new proposed rules would get nothing at all when their husbands' passed away. Unfortunately one junior minister agreed that this would also apply to UK born citizens who were still resident in the UK. Seems that we have both hypocrisy and the infliction of poverty on the elderly with this. Camermoron and cronies are constantly saying that the "family" and "family values" are of prime importance to society, now we have this spouse ruling apparently which implies that the family unit is not of prime importance and that only contributions to the funds are of importance and a man or woman cannot provide for their spouses if they choose to stay ay home an look after family. But what on earth are they going to do with all these people? Allow them to beg? Build lots of work houses? or is a holocaust type cull of the elderly planned?

regards


----------



## Mcmicrogal

*Tax on overseas assets*

I have read in many places that Spain will tax ex pats on any assets they have overseas, including property owned. Can anyone tell me what sort of percentage we are talking about? I am aware the penalty for getting caught not declaring the assets is up to 100% of the value of the assets.


----------



## xabiaxica

Spain doesn't currently tax worldwide assets, only worldwide income


----------



## Mcmicrogal

xabiachica said:


> Spain doesn't currently tax worldwide assets, only worldwide income


Ah, I must have misunderstood then. So they would only tax me on rental income from my parent's house, not the value of the house which is owned outright? How much do they take?


----------



## kurt85

This is what I know :

Under model 720 tax declaration of 2012,any assets owned abroad on December 31st 2012 whos value exceeded 50.000 euros, regardless of the asset, had to be declared.

Failure to do so by 31st march 2013, if discovered by the revenue can be fined up to 10.000 euros per item found.For example:

If you had 5 offshore bank accounts, with 10.000 pounds in each, this would be classed as 5 separate items, totalling 50.000 pounds fine, plus up to 150% penalty on any tax that the revenue feel you should have declared but didnt, this will also apply to a boat, a house, a car....etc any item over 50.000.

Where the assets are jointly owned, for example, 50.000 in a bank account, although its not 50.000 individually, the account is over 50.000 total, this is also accounted as an item, as it exceeds 50.0000, and both joint owners would need to make the declaration.

I hope this helps you 

Kurt


----------



## gus-lopez

kurt85 said:


> This is what I know :
> 
> Under model 720 tax declaration of 2012,any assets owned abroad on December 31st 2012 whos value exceeded 50.000 euros, regardless of the asset, had to be declared.
> 
> Failure to do so by 31st march 2013, if discovered by the revenue can be fined up to 10.000 euros per item found.For example:
> 
> If you had 5 offshore bank accounts, with 10.000 pounds in each, this would be classed as 5 separate items, totalling 50.000 pounds fine, plus up to 150% penalty on any tax that the revenue feel you should have declared but didnt, this will also apply to a boat, a house, a car....etc any item over 50.000.
> 
> Where the assets are jointly owned, for example, 50.000 in a bank account, although its not 50.000 individually, the account is over 50.000 total, this is also accounted as an item, as it exceeds 50.0000, and both joint owners would need to make the declaration.
> 
> I hope this helps you
> 
> Kurt


It does not apply to boats & cars.


----------



## kurt85

It would be nice to have a boat though over 50K!


----------



## Chopera

xabiachica said:


> Spain doesn't currently tax worldwide assets, only worldwide income


Although I think there is a wealth tax if your assets are worth over €700k (€1 million including your primary residence) and worldwide assets will count towards that.


----------



## Alcalaina

The declaration of overseas assets was introduced as part of the government's attack on tax evasion. It isn't an _additional_ tax.



> Spaniards and foreigners resident in Spain have declared assets held abroad in the form of bonds, shares, real estate and bank accounts of 87.7 billion euros, equivalent to nine percent of the country’s GDP.
> 
> As part of the government’s assault on tax evasion and fraud based on legislation passed last year, the Tax Agency now requires all taxpayers in Spain to declare assets worth more than 50,000 euros in any of four different categories of investment.
> 
> According to figures provided Wednesday by Prime Minister Mariano Rajoy, 131,411 taxpayers declared assets held overseas, of which 129,925 were individuals and the rest companies. Individuals declared 67.1 billion euros and companies 20.6 billion.
> 
> A European Union summit on Wednesday approved measures to crack down on tax fraud and evasion. “Spain’s commitment against tax fraud is total,” Rajoy told a news conference in Brussels. Spain is estimated to have a huge black market, which could amount to about a quarter of its official GDP. “The EU is going to make life difficult for tax dodgers and lead the world on this,” Rajoy said.
> 
> http://elpais.com/elpais/2013/05/23/inenglish/1369317553_673646.html


----------



## Alcalaina

Mcmicrogal said:


> Ah, I must have misunderstood then. So they would only tax me on rental income from my parent's house, not the value of the house which is owned outright? How much do they take?


If you don't own the house, you don't need to declare it as an overseas asset. The rental income should be declared as part of your total income on your annual tax return.


----------



## mrypg9

Alcalaina said:


> The declaration of overseas assets was introduced as part of the government's attack on tax evasion. It isn't an _additional_ tax.


Some of us have tried to point this out.
Some immigrants fear there will be a tax on these assets...


----------



## 90199

mrypg9 said:


> Some of us have tried to point this out.
> Some immigrants fear there will be a tax on these assets...


And that is why I am drinking mine


----------



## kimuyen

xabiachica said:


> Spain doesn't currently tax worldwide assets, only worldwide income


So, the declaration of assets outside of Spain is FYI only if one pays taxes in their home country? We will file US taxes once move and assume that there is taxation agreement between Spain and the US that we don't pay Spain again for what we are already taxed in the US.



Alcalaina said:


> If you don't own the house, you don't need to declare it as an overseas asset.


Does it mean that if our house is worth $100,000 but the remaining mortgage is $50,000, we still need to declare $50,000 equity as asset? Who determines the value of the asset?

Thanks!


----------



## zenkarma

kimuyen said:


> So, the declaration of assets outside of Spain is FYI only if one pays taxes in their home country?


You only have to declare overseas assets held if you are a fiscal tax resident of Spain. At the moment, it is for information only, but who knows what they might do in the future?



kimuyen said:


> Does it mean that if our house is worth $100,000 but the remaining mortgage is $50,000, we still need to declare $50,000 equity as asset? Who determines the value of the asset?!


As far as I understand it, it's based on current market value and liabilities such as a mortgage are not taken into consideration. I think you have to put down two figures, acquisition value and current market value.


----------



## Mcmicrogal

CapnBilly said:


> Checked with my gestoria, and she confirms that my analysis was correct, the reporting requirement is based on the acquisition value, so that's about £40,806.


So, if your property was not in fact purchased, but was inherited (in other words I did not hand over any cash for it) I would not have to declare it?


----------



## xabiaxica

Mcmicrogal said:


> So, if your property was not in fact purchased, but was inherited (in other words I did not hand over any cash for it) I would not have to declare it?


No, it's an asset so you declare its current value


----------



## 90199

zenkarma said:


> You only have to declare overseas assets held if you are a fiscal tax resident of Spain. At the moment, it is for information only, but who knows what they might do in the future?
> 
> 
> 
> As far as I understand it, it's based on current market value and liabilities such as a mortgage are not taken into consideration. I think you have to put down two figures, acquisition value and current market value.



When I made the declaration, earlier this year, overseas property was based on the purchase price, I declared one detached property for under €5000, the actual purchase cost in 1973 another flat was purchased in 2010 €84000, I had to declare the full amount even though I only owned 25%.


----------



## CapnBilly

No, you have to declare the value at the date of inheritance. If you sell it, then you have to make another declaration for that year, and deckare tge sale value. The difference ( after official adjustment for inflation) is then subject to capital gains


----------



## xabiaxica

CapnBilly said:


> No, you have to declare the value at the date of inheritance. If you sell it, then you have to make another declaration for that year, and deckare tge sale value. The difference ( after official adjustment for inflation) is then subject to capital gains



DUH! you're right of course!


coffee before posting required.... how would the current value be decided


----------



## Alcalaina

Hepa said:


> I had to declare the full amount even though I only owned 25%.


But there is a field on the form to indicate the percentage you own, as I recall.


----------



## Stravinsky

CapnBilly said:


> No, you have to declare the value at the date of inheritance. If you sell it, then you have to make another declaration for that year, and deckare tge sale value.* The difference ( after official adjustment for inflation) is then subject to capital gains*


In the beginning it was made out for sure that when the 720 went in you declared the acquisition value of the property in the UK. Has that changed (I've been tied up with other things)

If so, then that of course does indeed mean that any expat that sells a house that they have owned for a long time is going to pay a heavy CGT, as well as those that inherit?


----------



## gus-lopez

Stravinsky said:


> In the beginning it was made out for sure that when the 720 went in you declared the acquisition value of the property in the UK. Has that changed (I've been tied up with other things)
> 
> If so, then that of course does indeed mean that any expat that sells a house that they have owned for a long time is going to pay a heavy CGT, as well as those that inherit?


But if you bought it 30-40 years ago you didn't have to declare it if it had a value of less than 50k . You would only have had to declare it if you had a 2nd property & the combined value went over 50k.
. inheritors are going to pay, yes.


----------



## CapnBilly

Stravinsky said:


> In the beginning it was made out for sure that when the 720 went in you declared the acquisition value of the property in the UK. Has that changed (I've been tied up with other things)
> 
> If so, then that of course does indeed mean that any expat that sells a house that they have owned for a long time is going to pay a heavy CGT, as well as those that inherit?


Although if you bought or inherited it before 1986, the indexation was 11.1% a year upto the end of 1996, so you would be okay, after that, its not as high.


----------



## crookesey

*Spanish Tax On Worldwide Assets*

I understand that the Spanish are not obliged to declare all of their world wide assets, any comments guys?


----------



## xabiaxica

crookesey said:


> I understand that the Spanish are not obliged to declare all of their world wide assets, any comments guys?


they are


----------



## crookesey

xabiachica said:


> they are


Does that include cars and boats?


----------



## zenkarma

crookesey said:


> Does that include cars and boats?


You only have to declare overseas assets worth more than €50,000 in property, investments and bank accounts. I don't believe cars and boats are included.


----------



## kimuyen

zenkarma said:


> You only have to declare overseas assets worth more than €50,000 in property, investments and bank accounts. I don't believe cars and boats are included.


Does it mean then if I have 5 investment accounts at 40,000 euros each, then I do not need to delare, but if I have them all in ONE account for a total of 200,000 euros, then I have to declare? Same with bank accounts. Is it the *total *assets or i*ndividual* accounts?

Thanks.


----------



## zenkarma

kimuyen said:


> Does it mean then if I have 5 investment accounts at 40,000 euros each, then I do not need to delare, but if I have them all in ONE account for a total of 200,000 euros, then I have to declare? Same with bank accounts. Is it the *total *assets or i*ndividual* accounts?


It's by asset class. So, total on deposit in bank accounts, total in investment funds and so on.

So if you had more than €50,000 in several bank accounts you'd have to declare them all.


----------



## crookesey

kimuyen said:


> Does it mean then if I have 5 investment accounts at 40,000 euros each, then I do not need to delare, but if I have them all in ONE account for a total of 200,000 euros, then I have to declare? Same with bank accounts. Is it the *total *assets or i*ndividual* accounts?
> 
> Thanks.


The whole thing has all the signs of a cobbled together cash grab, how does the EU view this I wonder?

I understand that the Portuguese have sharpened their pencils and are actively seeking EU retirees. As I see the Spanish system, only pension rich, cash and assets poor expats can benefit from the recent rules. The boats and cars rule doesn't work the other way round by the way, as far as I can see.


----------



## mrypg9

zenkarma said:


> It's by asset class. So, total on deposit in bank accounts, total in investment funds and so on.
> 
> So if you had more than €50,000 in several bank accounts you'd have to declare them all.


Does that apply only to deposits? I keep under 40k€ on deposit offshore but around 10k € for some of the year in a Spanish current account, topping up from deposit when needed.
Partner has investments well over the limit. Our financial affairs are totally separate.


----------



## Alcalaina

crookesey said:


> I understand that the Spanish are not obliged to declare all of their world wide assets, any comments guys?


Crookesey, the law is AIMED at Spanish citizens. Expats just got caught up in it because they can't be treated differently.


----------



## zenkarma

mrypg9 said:


> Does that apply only to deposits?


I'm not sure what you mean by does that apply only to deposits. The €50k limit is split by asset class. So, money held within a bank account. It doesn't matter what type of bank account, if it's held overseas and totals more than €50k then it needs to be declared.

If you've got a total of €40k held in overseas bank accounts and the remainder held in Spain you wouldn't need to declare them. It only applies to overseas accounts.



mrypg9 said:


> Partner has investments well over the limit.


Then she should be declaring them if they're held overseas!


----------



## zenkarma

Alcalaina said:


> Crookesey, the law is AIMED at Spanish citizens. Expats just got caught up in it because they can't be treated differently.


There's some logic to the view that this new ruling was brought in to target principally non-Spanish residents. For the simple reason that your average Spanish born citizen is unlikely to hold assets overseas over the set limits. Some wealthy ones will of course but the vast majority will not hold any assets overseas.

The majority of people who will hold assets overseas over these limits will be the non Spanish born residents.

The more sinister implication of this new law is that the Spanish government at some point in the future will start to tax these assets via a modification to the current wealth tax. Once they're declared you can hardly deny they exist. Knowing how the Spanish government seems to operate, I think this is what concerns people the most and quite rightly in my opinion.

And considering the above, it's the non Spanish born residents that hold the majority of overseas assets that will be hit by any new taxes the most which of course would be grossly unfair.

This new law was brought in a little too soon after the Cyprus debacle for my liking. Which shows quite clearly that governments will take whatever steps they need to, to raise revenues if they become desperate enough.

We don't know yet just how desperate this Spanish government might become in the future. The recent proposed levy on electricity generated by solar panels shows some measure of desperation, and some measure of lunacy!


----------



## kimuyen

zenkarma said:


> The more sinister implication of this new law is that the Spanish government at some point in the future will start to tax these assets via a modification to the current wealth tax. Once they're declared you can hardly deny they exist. Knowing how the Spanish government seems to operate, I think this is what concerns people the most and quite rightly in my opinion.


It is certainly a concern if Spain will impose taxes on overseas assets but wouldn't it be a kiss of death though as expats will start flocking out of the country faster than they come in? 

Spain is luring foreign investors to save their economy (e.g., one can get residency if he/she buys a property of 500000 euros or more) so chasing away expats/foreigners is not exactly sound economic policy.


----------



## gus-lopez

mrypg9 said:


> Does that apply only to deposits? I keep under 40k€ on deposit offshore but around 10k € for some of the year in a Spanish current account, topping up from deposit when needed.
> Partner has investments well over the limit. Our financial affairs are totally separate.


Nothing in Spain has to be declared. Nothing in spain is added to anything in another country.


----------



## mrypg9

zenkarma said:


> I'm not sure what you mean by does that apply only to deposits. The €50k limit is split by asset class. So, money held within a bank account. It doesn't matter what type of bank account, if it's held overseas and totals more than €50k then it needs to be declared.
> 
> If you've got a total of €40k held in overseas bank accounts and the remainder held in Spain you wouldn't need to declare them. It only applies to overseas accounts.
> 
> 
> 
> Then she should be declaring them if they're held overseas!


Yes, we've done all that's required. Some assets are in Spain, some offshore. We live off my incomes but having spent most of my capital on everyday living, renting big houses etc. I know have less than the required declaration amount in an offshore account. But my wuestion was this: if the money on deposit is under the 50k€ but cash for living expenses in a current account takes the total to over 50k€ mis the total amount declarable?


----------



## mrypg9

Yes, we've done all that's required. Some assets are in Spain, some offshore. We live off my incomes but having spent most of my capital on everyday living, renting big houses etc. I know have less than the required declaration amount in an offshore account. But my question was this: if the money on deposit is under the 50k€ but cash for living expenses in a Spanish current account takes the total to over 50k€ mis the total amount declarable?


----------



## xabiaxica

mrypg9 said:


> Yes, we've done all that's required. Some assets are in Spain, some offshore. We live off my incomes but having spent most of my capital on everyday living, renting big houses etc. I know have less than the required declaration amount in an offshore account. But my question was this: if the money on deposit is under the 50k€ but cash for living expenses in a *Spanish current account takes the total to over 50k€ mis the total amount declarable*?


no - because what you have in a Spanish account isn't overseas.....

so they already know about it............


----------



## crookesey

Now that all the 'Jack the Lads' have discovered that being snide airport taxi drivers, unregistered property agents, club/bar bouncers, timeshare touts/sales etc; is no longer viable, the Spanish revenue have found that the relatively well heeled expat population are far easier and more profitable game. But if these guys are happy to have declared everything and potentially placed themselves in the mercy of the Spanish tax-man, good luck to them.


----------



## mrypg9

xabiachica said:


> no - because what you have in a Spanish account isn't overseas.....
> 
> so they already know about it............


Thanks, that's what I thought. I try to keep my sterling offshore account below any declarable level by transferring funds to Spain....and spending!


Between us, OH and I have manos limpias..


----------



## mrypg9

Two points must be stressed here as clearly not everyone has grasped them:

One, that this requirement applies to Spanish citizens, as Alcalaina has pointed out,and 
Two, it is not a tax, it hasn't yet been applied, it may never be applied.

As the wealthiest immigrant group here is Russian, are they also fretting about this reporting requirement, I wonder?


----------



## snikpoh

mrypg9 said:


> Yes, we've done all that's required. Some assets are in Spain, some offshore. We live off my incomes but having spent most of my capital on everyday living, renting big houses etc. I know have less than the required declaration amount in an offshore account. But my wuestion was this: if the money on deposit is under the 50k€ but cash for living expenses in a current account takes the total to over 50k€ mis the total amount declarable?


I think this has already been answered but here is my answer.

If you have, say, 50k€ on deposit in some country other than Spain plus then a current account of over 10k€ in UK, then the total is over the limit and MUST be declared.

If, however, the 10k€ for living expenses is in an account in Spain, then this does NOT get added to the pot so you are OK.


Hoping that's a little clearer.


----------



## mrypg9

snikpoh said:


> I think this has already been answered but here is my answer.
> 
> If you have, say, 50k€ on deposit in some country other than Spain plus then a current account of over 10k€ in UK, then the total is over the limit and MUST be declared.
> 
> If, however, the 10k€ for living expenses is in an account in Spain, then this does NOT get added to the pot so you are OK.
> 
> 
> Hoping that's a little clearer.


Thanks, Snik. I thought we had done The Right Thing, now I know we have.

I can understand some immigrants or potential immigrants having concerns about any future 'grab' by Hacienda but there are also many of us who are here, including 'wealthy pensioners', simply to enjoy our retirement years, have enough on which to live our preferred lifestyle and have no need to think of passing on any inheritance.
So we will take what comes and enjoy our chosen country of residence regardless...because we think it's worth it!

There are very many unforeseen events that can affect one's income in Spain if one is a British immigrant ,many of them already in place, such as the huge amount of QE from the BoE which has devalued assets, low interest rates kept low as policy and of course fluctuating exchange rates. These originate from the UK Government...

The fact that the Spanish Government has decided to ask ALL residents to register overseas assets over 50k euros has had zero affect on those who have complied and it is pure speculation to talk as if this 'grab' is about to take place.

Anyone living in Spain or planning to live in Spain can weigh up the facts and make up their own minds. If..and it's an 'if'....this declaration becomes a tax on the declared assets, then yes, it's an important factor to add to your decision-making. It's a question of whether you are prepared to pay the price for your new life in Spain. Some are, some aren't. It's their choice.

But from our viewpoint, it's the UK Government that has done more to reduce the earning power of our investments and the purchasing power of the £, not something the Spanish Government *might* do.


----------



## Madliz

I have filed my m720 this very week, having stupidly realised that I was 'over the limit' due to receiving a small inheritance in the UK from my Mum. I have not received a tax return since the year following my husband's death three years ago and (stupidly again, as it turns out) thought that if I owed anything they would have told me.

Like finding your way around a badly designed website, it was daunting at first, but after spending some time reading and thinking, it was all quite straightforward once I had all the relevant figures to hand. I now await notification of what fines they will dish out. As I understand it, there's €100 for each undeclared item with a minimum of €1500, for declaring late (should have been April), - way better than the exorbitant fines if they 'discover' before you declare. Eff-all interest and now this. :Cry:


----------



## Alcalaina

zenkarma said:


> There's some logic to the view that this new ruling was brought in to target principally non-Spanish residents. For the simple reason that your average Spanish born citizen is unlikely to hold assets overseas over the set limits. Some wealthy ones will of course but the vast majority will not hold any assets overseas.
> 
> The majority of people who will hold assets overseas over these limits will be the non Spanish born residents.
> 
> The more sinister implication of this new law is that the Spanish government at some point in the future will start to tax these assets via a modification to the current wealth tax. Once they're declared you can hardly deny they exist. Knowing how the Spanish government seems to operate, I think this is what concerns people the most and quite rightly in my opinion.
> 
> And considering the above, it's the non Spanish born residents that hold the majority of overseas assets that will be hit by any new taxes the most which of course would be grossly unfair.
> 
> This new law was brought in a little too soon after the Cyprus debacle for my liking. Which shows quite clearly that governments will take whatever steps they need to, to raise revenues if they become desperate enough.
> 
> We don't know yet just how desperate this Spanish government might become in the future. The recent proposed levy on electricity generated by solar panels shows some measure of desperation, and some measure of lunacy!


Heaven knows I'm not a fan of this govt but I doubt very much they are sitting round trying to think up ways to deter wealthy foreigners from becoming resident. 

The average Spaniard might not hold overseas assets but there are some VERY wealthy ones who have stashed their cash overseas to try and evade tax. Any attempt to make this more difficult must be applauded, surely?


----------



## mrypg9

Alcalaina said:


> Heaven knows I'm not a fan of this govt but I doubt very much they are sitting round trying to think up ways to deter wealthy foreigners from becoming resident.
> 
> The average Spaniard might not hold overseas assets but there are some VERY wealthy ones who have stashed their cash overseas to try and evade tax. Any attempt to make this more difficult must be applauded, surely?


By any right-thinking person


----------



## JaneyO

Alcalaina said:


> Heaven knows I'm not a fan of this govt but I doubt very much they are sitting round trying to think up ways to deter wealthy foreigners from becoming resident.
> 
> The average Spaniard might not hold overseas assets but there are some VERY wealthy ones who have stashed their cash overseas to try and evade tax. Any attempt to make this more difficult must be applauded, surely?


Back in the Spring I was told by my FA who had it from sources in HAcienda that this declaration requirement came about because the govt was being pressurised by Spanish banks to 'encourage' people, Spanish and otherwise, to move their money to them!


----------



## extranjero

Stravinsky said:


> In the beginning it was made out for sure that when the 720 went in you declared the acquisition value of the property in the UK. Has that changed (I've been tied up with other things)
> 
> If so, then that of course does indeed mean that any expat that sells a house that they have owned for a long time is going to pay a heavy CGT, as well as those that inherit?


I cannot understand why the present value of property does not have to be declared on 720, as well as the aquisition value, as it will obviously be an asset of more than 50,000 euros. Handy for the tax office when working out the iht as well!


----------



## mrypg9

JaneyO said:


> Back in the Spring I was told by my FA who had it from sources in HAcienda that this declaration requirement came about because the govt was being pressurised by Spanish banks to 'encourage' people, Spanish and otherwise, to move their money to them!


Well, if so, all well and good. Investing in the country in which you reside must surely be a good thing to do.
But all this is mere conjecture...
OH has transferred some assets to investment funds in Spain.


----------



## extranjero

crookesey said:


> Now that all the 'Jack the Lads' have discovered that being snide airport taxi drivers, unregistered property agents, club/bar bouncers, timeshare touts/sales etc; is no longer viable, the Spanish revenue have found that the relatively well heeled expat population are far easier and more profitable game. But if these guys are happy to have declared everything and potentially placed themselves in the mercy of the Spanish tax-man, good luck to them.



We must all be mugs, then.
So what do you advise that lawful expats do then, ignore the assets law? risk hiding assets-what did YOU do?


----------



## jimenato

Alcalaina said:


> Heaven knows I'm not a fan of this govt but I doubt very much they are sitting round trying to think up ways to deter wealthy foreigners from becoming resident.
> 
> The average Spaniard might not hold overseas assets but there are some VERY wealthy ones who have stashed their cash overseas to try and evade tax. Any attempt to make this more difficult must be applauded, surely?


Perhaps the Spanish government should enter into a transparency agreement with Gibraltar then - just about every other government has and Gibraltar has offered to open its books. 

Makes you wonder why Spain has declined the offer doesn't it?


----------



## gus-lopez

extranjero said:


> I cannot understand why the present value of property does not have to be declared on 720, as well as the aquisition value, as it will obviously be an asset of more than 50,000 euros. Handy for the tax office when working out the iht as well!


If the aquisition value was below 50k euros when you bought it , you do not have to declare it. If you then decide to sell it , the spanish tax office has no claim , only the country where it is situated might.


----------



## Alcalaina

jimenato said:


> Perhaps the Spanish government should enter into a transparency agreement with Gibraltar then - just about every other government has and Gibraltar has offered to open its books.
> 
> Makes you wonder why Spain has declined the offer doesn't it?


Apparently it's the other way round. Can't post links on this tablet but if you google 'Gibraltar obliged to share tax info with Spain' (August 2013), you should find it.


----------



## crookesey

extranjero said:


> We must all be mugs, then.
> So what do you advise that lawful expats do then, ignore the assets law? risk hiding assets-what did YOU do?


I don't consider anyone who moved to Spain and became a resident prior to the draconian declaration rule to be mugs. There is no way that I would declare legitimate ownership of an overseas property to the UK revenue, so why should I do the same in reverse? However I would not advocate breaking the law, just limiting my stay to the maximum allowed without declaration liability, until I could dispose of any Spanish property and move on to somewhere with more reasonable taxation laws, Portugal comes to mind.


----------



## jimenato

Alcalaina said:


> Apparently it's the other way round. Can't post links on this tablet but if you google 'Gibraltar obliged to share tax info with Spain' (August 2013), you should find it.


That's good to know. 

It must be a special case as Gibraltar has tax disclosure treaties with many countries...



> Australia, Austria, Belgium, Denmark, Faroe Islands, Finland, France, Germany, Greece, Greenland, Iceland, Ireland, Netherlands, New Zealand, Norway, Portugal, Sweden, UK, USA.


...but not Spain.

Gibraltar is on the important 'white list' of jursidictions which have implemented the international tax standards. 

As far as I am aware, Gibraltar has offered a double taxation agreement but Spain has so far declined.

This is Picardo quoted recently...



> "One of the things Spain needlessly complains about is Gibraltar's position as a financial services centre, insisting that Gibraltar is a tax haven," he said.
> 
> "I'm putting on the table now the possibility of discussing with Spain a double taxation or tax information agreement." Gibraltar would share information on Spaniards with accounts or investments in Gibraltar


----------



## crookesey

As for low UK interest rates for investors, we are just coming to the end of a 4% two years fixed cash ISA deal on a fair sized lump of cash, however I've managed to find a two year deal at 2.65%, if as I anticipate our current provider doesn't have anything better, so it keeps track with inflation.

We managed to put together a reasonable portfolio from our efforts in the UK, similar to many forum members I suppose. UK property prices haven't halved, unemployment figures are coming down and we legitimately pay very little tax, I can't see where we are the basket case often mentioned by UK expats. 

I don't see any half decent cash savings accounts in Spain, they don't have anything like an ISA account, and wish to tax assets wherever they may be. Property is still coming down in value whilst unemployment statistics show worrying increases on a regular basis, but the weather is better I suppose.


----------



## extranjero

gus-lopez said:


> If the aquisition value was below 50k euros when you bought it , you do not have to declare it. If you then decide to sell it , the spanish tax office has no claim , only the country where it is situated might.


If you sell a property in UK then you have to pay capital gains tax on it in Spain, if resident here!


----------



## mrypg9

extranjero said:


> If you sell a property in UK then you have to pay capital gains tax on it in Spain, if resident here!


I like your posts when you're not being a miserable sod, extranjero!


----------



## extranjero

mrypg9 said:


> I like your posts when you're not being a miserable sod, extranjero!


I think we would get on well!


----------



## mrypg9

extranjero said:


> I think we would get on well!


You could be right I like people who don't always see things my way...providing they express their views politely and reasonably and that you always do even when I'm quite tart with you.


----------



## gus-lopez

extranjero said:


> If you sell a property in UK then you have to pay capital gains tax on it in Spain, if resident here!


Err, no. Haciendas own words to an acquaintance who asked me to accompany him as his Spanish is non -existent.

Hacienda ; " The property did not have to be declared on the 720 as the purchase price was below 50k euros " 
" Therefore as far as we are concerned we have no interest in it but the UK will possibly have. " 

Me ; " Could Sñr. xxxxx have that in writing please" 
Hacienda " Yes , no problem."


----------



## zenkarma

gus-lopez said:


> Hacienda ; " The property did not have to be declared on the 720 as the purchase price was below 50k euros " " Therefore as far as we are concerned we have no interest in it but the UK will possibly have. "
> Me ; " Could Sñr. xxxxx have that in writing please"
> Hacienda " Yes , no problem."


This just highlights how useless, incompetent and stupid the Spanish bureaucracy is.


----------



## CapnBilly

gus-lopez said:


> Err, no. Haciendas own words to an acquaintance who asked me to accompany him as his Spanish is non -existent. Hacienda ; " The property did not have to be declared on the 720 as the purchase price was below 50k euros " " Therefore as far as we are concerned we have no interest in it but the UK will possibly have. " Me ; " Could Sñr. xxxxx have that in writing please" Hacienda " Yes , no problem."


Hmm, I think that statement is correct as far as the 720 is concerned, but I'm not sure I'd rely on it for capital gains. Unless if course he owned it since 1985, in which the allowance for capital gains would mean the value was nil.


----------



## JaneyO

crookesey said:


> Now that all the 'Jack the Lads' have discovered that being snide airport taxi drivers, unregistered property agents, club/bar bouncers, timeshare touts/sales etc; is no longer viable, the Spanish revenue have found that the relatively well heeled expat population are far easier and more profitable game. But if these guys are happy to have declared everything and potentially placed themselves in the mercy of the Spanish tax-man, good luck to them.


Happy? Of course we're not happy! We had to do it to obey the law and the ensuing fines if 'found out' are so appalling its not worth the risk. With the way international banking is going these days you might be safe if you kept your money in a Swiss vault but not otherwise. Not all of us are able to absent ourselves from Spain for the required time to avoid tax and we don't want to spend our retirement looking over our shoulder for a pursuing taxman or dreading what the post box might contain. Happy we are not! Maybe just resigned!


----------



## Alcalaina

jimenato said:


> That's good to know.
> 
> It must be a special case as Gibraltar has tax disclosure treaties with many countries...
> 
> ...but not Spain.
> 
> Gibraltar is on the important 'white list' of jursidictions which have implemented the international tax standards.
> 
> As far as I am aware, Gibraltar has offered a double taxation agreement but Spain has so far declined.
> 
> This is Picardo quoted recently...


I don't suppose many Spanish tax dodgers would stash their dosh in Gib anyway. Barcenas kept his in Switzerland didn't he? And he won't be the only one.


----------



## mrypg9

JaneyO said:


> Happy? Of course we're not happy! We had to do it to obey the law and the ensuing fines if 'found out' are so appalling its not worth the risk. With the way international banking is going these days you might be safe if you kept your money in a Swiss vault but not otherwise. Not all of us are able to absent ourselves from Spain for the required time to avoid tax and we don't want to spend our retirement looking over our shoulder for a pursuing taxman or dreading what the post box might contain. Happy we are not! Maybe just resigned!


Yes, most people do the right thing, whether in the UK Spain or Timbuktu. Of course we're not happy but neither are we unhappy. As you say, we are resigned. We also realise that we contribute via our taxes to the essential public services we all use some of the time.

As for the unsavoury Brits....simple answer: avoid like the plague! Fortunately there aren't any in our little village although I suspect crimials of the deadlier and wealthier type might be found not too far in some of the posh houses round here...there was a Mafia execution five minutes walk from our house five years ago!

I think that your fears about tax grabs and so on are not likely to be realised. It's all speculation. No-one knows what will happen- or not- and there are those immigrants here do like to see everything as 'the Spanish our out to get us and strip us of our huge wealth' . Most Brits in Spain are not that well off, in fact, although retired Brits can be better off than a working Spaniard with a family these days.
The bottom line as I see it is that you consider all factors then decide if you are willing and able to make the move. Simple as that.


----------



## kimuyen

I stumbled across the document below which I found very helpful and pretty comprehensive. It is interesting to see the tax rates for different regions on the last few pages of the document. 

http://www.pwc.com/us/en/hr-international-assignment-services/assets/spain-folio.pdf


----------



## kimuyen

*Wealth Tax*

Could someone with knowledge please confirm this for me? 

*"Wealth tax (Impuesto Sobre el Patrimonio) has been reinstated in Spain for tax years 2011 and 2012 as part of Spain’s austerity measures by repealing the 100% wealth tax allowance that has been available since 2008. This is a temporary measure and the 100% tax allowance will apply again from 1 January 2013. 

The wealth tax is based on the individual’s net assets held at 31 December each year, with the rate of wealth tax ranging from 0.2% to 2.5%. The minimum tax exemption amount has been increased to €700,000 so anyone with net assets above this figure will pay wealth "*http://www.financespain.com/images/Expatriates_Financial_Guide_Spain.pdf

So, Spain HAS taxed residents on their assets/wealth? I have been reading this thread and thought residents are required to DECLARE (vs. pay taxes on) assets overseas but I was not aware that the wealth tax was implemented per the excerpt above. 

From reading the excerpt above, does it mean that the wealth tax is NOT in effect now in 2013 and going forward? Of course they can change their mind any time.

This is quite alarming.


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## snikpoh

kimuyen said:


> Could someone with knowledge please confirm this for me?
> 
> *"Wealth tax (Impuesto Sobre el Patrimonio) has been reinstated in Spain for tax years 2011 and 2012 as part of Spain’s austerity measures by repealing the 100% wealth tax allowance that has been available since 2008. This is a temporary measure and the 100% tax allowance will apply again from 1 January 2013.
> 
> The wealth tax is based on the individual’s net assets held at 31 December each year, with the rate of wealth tax ranging from 0.2% to 2.5%. The minimum tax exemption amount has been increased to €700,000 so anyone with net assets above this figure will pay wealth "*http://www.financespain.com/images/Expatriates_Financial_Guide_Spain.pdf
> 
> So, Spain HAS taxed residents on their assets/wealth? I have been reading this thread and thought residents are required to DECLARE (vs. pay taxes on) assets overseas but I was not aware that the wealth tax was implemented per the excerpt above.
> 
> From reading the excerpt above, does it mean that the wealth tax is NOT in effect now in 2013 and going forward? Of course they can change their mind any time.
> 
> This is quite alarming.



Yes, Wealth tax has been in Spain for as long as I can remember. As stated above, allowances were increased to 100% for a while (so no tax was payable) but then new levels were introduced.

I don't know if it did go back to 100% allowance on 1st Jan - maybe someone can let us know.

The new asset reporting rules are just a way of making sure that people are not breaking the law by failing to declare assets.

I would suggest that few people will have sufficient assets to pay wealth tax given that there are large allowances for property for example (300k per person on main house).

I personally don't know why people are making such a fuss given that these assets should have been declared anyway - the only reason they weren't was for tax evasion purposes!


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## CapnBilly

Wealth Tax was introduced in Spain in 1977, following the change to a democracy. Before the rules were changed in 2008 to a 100% allowance, the exempt amount was about €108000. 

It was reintroduced in 2011 as a temporary measure, for 2011 and 2012, but has yet to be withdrawn, so is still in place, and will be payable at the end of December 2013, unless withdrawn before then (unlikely).

Having said that, the allowances when it was reintroduced were quite high, (€700k plus €300k for main property per person) and in some Provinces were even more generous. Valencia, for example still allowed a 100% allowance, but this was withdrawn earlier this year, so it will be payable in Valencia in 2013, after the national allowances.


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## Chopera

kimuyen said:


> Could someone with knowledge please confirm this for me?
> 
> *"Wealth tax (Impuesto Sobre el Patrimonio) has been reinstated in Spain for tax years 2011 and 2012 as part of Spain’s austerity measures by repealing the 100% wealth tax allowance that has been available since 2008. This is a temporary measure and the 100% tax allowance will apply again from 1 January 2013.
> 
> The wealth tax is based on the individual’s net assets held at 31 December each year, with the rate of wealth tax ranging from 0.2% to 2.5%. The minimum tax exemption amount has been increased to €700,000 so anyone with net assets above this figure will pay wealth "*http://www.financespain.com/images/Expatriates_Financial_Guide_Spain.pdf
> 
> So, Spain HAS taxed residents on their assets/wealth? I have been reading this thread and thought residents are required to DECLARE (vs. pay taxes on) assets overseas but I was not aware that the wealth tax was implemented per the excerpt above.
> 
> From reading the excerpt above, does it mean that the wealth tax is NOT in effect now in 2013 and going forward? Of course they can change their mind any time.
> 
> This is quite alarming.


The asset declaration that the thread refers to (modulo 720) is supposedly just that - an asset declaration - and not used for collecting taxes (although I have heard of cases where people have been taxed as a result of the declaration). The 720 is a one-off declaration that you only make when you have a certain amount of assets. Separate to this is the regular annual tax declaration, which *is* used to calculate taxes, including wealth taxes.

The purpose of the 720 is to prevent people from hiding assets overseas - the message being that if we catch you with undeclared assets we'll hammer you, full stop. However I expect that it will eventually be used as a basis for taxation as well.


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## Chopera

CapnBilly said:


> Wealth Tax was introduced in Spain in 1977, following the change to a democracy. *Before the rules were changed in 2008 to a 100% allowance, the exempt amount was about €108000. *
> 
> ...


Blimey. I bet a lot of people paid that!


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## snikpoh

Chopera said:


> The asset declaration that the thread refers to (modulo 720) is supposedly just that - an asset declaration - and not used for collecting taxes (although I have heard of cases where people have been taxed as a result of the declaration). The 720 is a one-off declaration that you only make when you have a certain amount of assets. Separate to this is the regular annual tax declaration, which *is* used to calculate taxes, including wealth taxes.
> 
> The purpose of the 720 is to prevent people from hiding assets overseas - the message being that if we catch you with undeclared assets we'll hammer you, full stop. However I expect that it will eventually be used as a basis for taxation as well.



I thought the plan was to have to fill one in EVERY year if the value of assets substantially changed. For example, an asset matured and moved from one class to another or a property sold.


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## Chopera

snikpoh said:


> I thought the plan was to have to fill one in EVERY year if the value of assets substantially changed. For example, an asset matured and moved from one class to another or a property sold.


If you have declared a house that you bought say 10 years ago then you don't need to declare it on the 720 each year. You declare it once, and you declare the price you paid for it. It gets confusing if say you bought a house for less than the €50k threshold, but its value is now above €50k. I think then you still have to declare it, even though the value you declare is not the market price and is less than the €50k threshold. In both cases you declare the house once only.

If you have a say share portfolio that last year was worth less than €50k but this year it is worth more then you need to declare it this year. If yu decide to liquidate some shares so that the value of the portfolio goes below €50k but your cash holdings go above €50k then yes I assume you would have to declare that as well, and you'd have to declare it on your tax return as well since it would be subject to CGT. So for things like that then yes you do need to declare each year that such a change in asset class occurs. My general point was that you do not need to re-declare already declared asset classes each year because their value has changed. As you say, it's only when you move funds from one asset class to another.


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## JaneyO

Chopera said:


> If you have declared a house that you bought say 10 years ago then you don't need to declare it on the 720 each year. You declare it once, and you declare the price you paid for it. It gets confusing if say you bought a house for less than the €50k threshold, but its value is now above €50k. I think then you still have to declare it, even though the value you declare is not the market price and is less than the €50k threshold. In both cases you declare the house once only.
> 
> If you have a say share portfolio that last year was worth less than €50k but this year it is worth more then you need to declare it this year. If yu decide to liquidate some shares so that the value of the portfolio goes below €50k but your cash holdings go above €50k then yes I assume you would have to declare that as well, and you'd have to declare it on your tax return as well since it would be subject to CGT. So for things like that then yes you do need to declare each year that such a change in asset class occurs. My general point was that you do not need to re-declare already declared asset classes each year because their value has changed. As you say, it's only when you move funds from one asset class to another.[/QUOT
> Just wondering about this asset class thing. We declared money in banks which has now been moved to Spanish tax approved insurance type investments which the Fa says will be reported by the companies. Cash in the banks is now below the E50,000 limit. Not sure what we will have to do as the asset class has changed but the FA said the bonds don't go on the mod 720. Don't want them thinking we have the money in the bank AND the new bonds . Confused, as usual!


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## snikpoh

JaneyO said:


> Just wondering about this asset class thing. We declared money in banks which has now been moved to Spanish tax approved insurance type investments which the Fa says will be reported by the companies. Cash in the banks is now below the E50,000 limit. Not sure what we will have to do as the asset class has changed but the FA said the bonds don't go on the mod 720. Don't want them thinking we have the money in the bank AND the new bonds . Confused, as usual!



My advisers were unclear on this point so I chose to make a declaration anyway. I would rather have them know about it twice than not at all!

Yes, like you, I'm not sure what happens when an asset class goes below the limit and needs to be 'removed'.

Any one know?


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## JaneyO

snikpoh said:


> My advisers were unclear on this point so I chose to make a declaration anyway. I would rather have them know about it twice than not at all!
> 
> Yes, like you, I'm not sure what happens when an asset class goes below the limit and needs to be 'removed'.
> 
> Any one know?


Like everything to do with mod720 it's not very clear is it. Some sayyou have to do a new declaration if an asset 'changes' by 20 000 ie goes down as well as up - others say its if it' increases' by 20 000. Don't particulary want to do another declation if theres no need as it cost E90 each gestor fees! Hope some clever person on here knows the answer- where's Capn Billy?


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## Madliz

I saved myself €90 by doing it myself. It took a while to find my way around the form and understand exactly what they wanted, but I would say it was no worse than the form to renew a British passport, in fact it was more straightforward! Having done it once, if I have to do it again it would be easier. As it was, since I had all the account details at hand, it took no more than an hour.

As I understand it, you only have to declare again if the total at year end ever increases by €20,000 above what was last declared. So, for example, if 31.12.2013 shows a combined increase of €15,000 over that declared in 2012, there is no need to declare again, but if by 2014 the increase over 2012 has increased to €20,000+, m720 must be presented again.


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## Chopera

I don't know, but personally if I have declared assets of a certain class that collectively were worth more than €50k then, even if their collective value dropped below €50k, I would just leave them as being declared until I sold them. The problem is that if you start undeclaring assets the authorities might assume you have sold them and will try to tax you. Or they might assume you are trying to avoid tax by undeclaring them and then selling.

However if I had cash that I had declared and its value went below €50k, and I though its value would stay below €50k for the forseeable future then yes I'd probably try to undeclare it. I imagine it'd be less likely to cause a problem because cash is not something they try to tax if you "sell" it.


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## Chopera

Madliz said:


> I saved myself €90 by doing it myself. It took a while to find my way around the form and understand exactly what they wanted, but I would say it was no worse than the form to renew a British passport, in fact it was more straightforward! Having done it once, if I have to do it again it would be easier. As it was, since I had all the account details at hand, it took no more than an hour.
> 
> As I understand it, you only have to declare again if the total at year end ever increases by €20,000 above what was last declared. So, for example, if 31.12.2013 shows a combined increase of €15,000 over that declared in 2012, there is no need to declare again, but if by 2014 the increase over 2012 has increased to €20,000+, m720 must be presented again.


I guess property is an exception to this, since you only declare the purchase price anyway. Even if its market value increases by €20k, if you declare again you'll just end up entering the purchase price again.


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## extranjero

Chopera said:


> I guess property is an exception to this, since you only declare the purchase price anyway. Even if its market value increases by €20k, if you declare again you'll just end up entering the purchase price again.


I cannot understand why only the purchase price has to be mentioned. The value now should be declared.Many houses were bought years ago for less than 50,000 euros, not having to be declared, and are worth many hundreds of thousands now. This is an asset and they want you to declare them so why not state the present value?It's like stating you started a bank account with 50,000 10 years ago, but they don't want to know it is 100,000 now?


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## kimuyen

Chopera said:


> The asset declaration that the thread refers to (modulo 720) is supposedly just that - an *asset declaration - and not used for collecting taxes* (although I have heard of cases where people have been taxed as a result of the declaration). The 720 is a one-off declaration that you only make when you have a certain amount of assets. Separate to this is the regular annual tax declaration, which *is* used to calculate taxes, including wealth taxes.
> 
> The purpose of the 720 is to prevent people from hiding assets overseas - the message being that if we catch you with undeclared assets we'll hammer you, full stop. However I expect that it will eventually be used as a basis for taxation as well.


Sorry everything is still as clear as mud to me...

I understand the declaration of assets and will comply with the law to declare assets overseas that are over 50,000 euros. What I am still confused about though is *whether we pay wealth taxes on these assets?*. From your post and others', it is declaration only at this point. Then who pays the wealth tax (over 700,000 limit)? Does the wealth tax apply to assets IN Spain (vs. overseas)?

Sorry, we have not moved yet and our questions seem naive but we need to understand and factor in tax cost as the cost of living in Spain vs. elsewhere. 

Thanks!


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## Alcalaina

extranjero said:


> I cannot understand why only the purchase price has to be mentioned.


Probably something to do with who the legislation is really aimed at - the ones who made a killing in the boom years and hid their money overseas to avoid paying tax here. The purchase price indicates how much cash would otherwise have been taxable in Spain.


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## CapnBilly

Well, as usual, its all very complicated. As has already been said, if you have already submitted a declaration, then you only have to submit a new one if the value (in either of the 3 classes) increases by €20,000 (don't forget, this includes any increase through exchange rates - although unlikely this year).

Where it gets complicated is disposals. You have to report if you dispose of any assets during the year, previously reported. This includes shares you have sold, and property you have disposed of, with a value in excess of €50,000 , even if you haven't reported it previously.

Its not very clear with regard to deposits etc. The way I read it is, if you have joint accounts , and they become the assets of one person, during the year, then the person who no longer has ownership has to report that. This makes sense with the last declaration, whereby if you reported any accounts, you had to report closed accounts., including the closing balance. I guess its to try and stop people moving assets around.


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## CapnBilly

kimuyen said:


> Sorry everything is still as clear as mud to me...
> 
> I understand the declaration of assets and will comply with the law to declare assets overseas that are over 50,000 euros. What I am still confused about though is *whether we pay wealth taxes on these assets?*. From your post and others', it is declaration only at this point. Then who pays the wealth tax (over 700,000 limit)? Does the wealth tax apply to assets IN Spain (vs. overseas)?
> 
> Sorry, we have not moved yet and our questions seem naive but we need to understand and factor in tax cost as the cost of living in Spain vs. elsewhere.
> 
> Thanks!


You will only pay wealth tax, if all your assets exceed the current limits, as I posted. Wealth tax is calculated on all your worldwide assets. That doesn't mean they can't change the limits, but thats always been the case. I posted the limits before it was effectively zero rated.


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## extranjero

I thought that you only need to submit 720 again is if any asset class has increased by 20,000 euros.
I do not know if you have to only declare that class affected, or the whole lot again
What a pain this law is, and even "experts" cannot agree, and we are held responsible for what they do, or don't declare!
As it's entered electronically by the accountant, unless you scrutinise the entry yourself, and I bet many haven't, how do you know there aren't errors and ommisions for which you might be fined.
I don't disagree with the aim of the law, but harsh, draconian punishments for innocent errors, not even made by the client would put many off declaring.


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## CapnBilly

extranjero said:


> I cannot understand why only the purchase price has to be mentioned. The value now should be declared.Many houses were bought years ago for less than 50,000 euros, not having to be declared, and are worth many hundreds of thousands now. This is an asset and they want you to declare them so why not state the present value?It's like stating you started a bank account with 50,000 10 years ago, but they don't want to know it is 100,000 now?


I agree, but they have to start somewhere. As I posted before, you have to report the sale, when you sell it anyway. To a certain extent, they're only interested in the value when you sell it, and it becomes liable for capital gains.


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## JaneyO

kimuyen said:


> Sorry everything is still as clear as mud to me...
> 
> I understand the declaration of assets and will comply with the law to declare assets overseas that are over 50,000 euros. What I am still confused about though is *whether we pay wealth taxes on these assets?*. From your post and others', it is declaration only at this point. Then who pays the wealth tax (over 700,000 limit)? Does the wealth tax apply to assets IN Spain (vs. overseas)?
> 
> Sorry, we have not moved yet and our questions seem naive but we need to understand and factor in tax cost as the cost of living in Spain vs. elsewhere.
> 
> Thanks!


Well I'm not an expert but as far as I understand it you have to pay wealth tax on your worldwide assets, ie wherever they are, subject to the standard allowances. You pay tax on anything above the allowances. This is a different return to the modelo 720 which is just a declaration, however I understand they do compare the modelo 720 in some electronic way to check if you have paid the tax via the renta (annual tax return) or wealth tax or whatever the 720 leads them to think you might owe. I think you are very wise to be considering tax issues before you relocate the spanish taxman is rather greedy. We wouldn't be liable to any tax on our meagre income in the uk but because the allowances here are lower we do have to pay spanish tax and quite a lot of it. Sadly it's not all sun and sangria here!


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## kimuyen

CapnBilly said:


> You will only pay wealth tax, if all your assets exceed the current limits, as I posted. Wealth tax is calculated on all your worldwide assets. That doesn't mean they can't change the limits, but thats always been the case. I posted the limits before it was effectively zero rated.


Thank you, CapnBilly.

So to sum it up, we need to declare assets overseas and if the assets go over current limit of $700,000 then we need to pay wealth taxes on them, right?

I was naive to infer from previous posts that we just needed to declare and did not have to pay taxes on our assets regardless of amount.


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## extranjero

Cap,n Billy, i have read that UK bond are only taxed when cashed, with a chargeable gain certificate.
yet if they are declared on the 720, would the yearly profit have to be declared on the income tax declaration? If so they would be taxed twice.
I know some UK bonds are not approved in Spain, but thousands of people in Spain have had them for years-what are they supposed to do?


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## Chopera

kimuyen said:


> Sorry everything is still as clear as mud to me...
> 
> I understand the declaration of assets and will comply with the law to declare assets overseas that are over 50,000 euros. What I am still confused about though is *whether we pay wealth taxes on these assets?*. From your post and others', it is declaration only at this point. Then who pays the wealth tax (over 700,000 limit)? Does the wealth tax apply to assets IN Spain (vs. overseas)?
> 
> Sorry, we have not moved yet and our questions seem naive but we need to understand and factor in tax cost as the cost of living in Spain vs. elsewhere.
> 
> Thanks!


The wealth tax is based on a separate declaration to the 720, and it takes into account assets held worldwide, i.e. in Spain as well as outside. If you have a €2million villa in Spain you should declare in on your tax return and pay wealth tax. If you have a €2million house in London you should also declare in on your tax return and pay wealth tax. However the 720 form requires you to declare assets held overseas only, e.g. the house in London but not the villa in Spain. However you will not be charged wealth tax based on the declaration of the London house on the 720. All the 720 requires is for people to say (declare) what they own overseas. The 720 declaration is not used for tax calculation purposes (so they say) it is there to prevent people from hiding money overseas. If they catch you with significant amounts of undeclared money overseas they will fine you heavily.


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## zenkarma

kimuyen said:


> So to sum it up, we need to declare assets overseas and if the assets go over current limit of $700,000 then we need to pay wealth taxes on them, right?


In effect, yes. If your _total_ assets in Spain or worldwide minus allowances go over the wealth tax limit you will have to pay some tax on them.



kimuyen said:


> I was naive to infer from previous posts that we just needed to declare and did not have to pay taxes on our assets regardless of amount.


Well most people will assume that the vast majority of people will not have worldwide assets that would total over what is effectively 3/4 of a million euros. The wealth tax upper limit is sufficiently high that most normal mortal everyday folks will not be effected by it which is probably why it's not often mentioned.

In my opinion (and it is only my opinion, I'm not saying it's the right opinion) anyone with that kind of wealth should be paying taxes!


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## CapnBilly

zenkarma said:


> Well most people will assume that the vast majority of people will not have worldwide assets that would total over what is effectively 3/4 of a million euros. The wealth tax upper limit is sufficiently high that most normal mortal everyday folks will not be effected by it which is probably why it's not often mentioned. In my opinion (and it is only my opinion, I'm not saying it's the right opinion) anyone with that kind of wealth should be paying taxes!


]

I agree, especially as it's per person, so if you include property it's €2 m for a couple before you pay a bean.


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## kimuyen

CapnBilly said:


> ]
> 
> I agree, especially as it's per person, so if you include property it's €2 m for a couple before you pay a bean.


So the 700,000 limit is per person? 

I know it sounds like a lot of money even for 700,000 euros but where we live in the States things are so expensive that a townhouse could cost move than $500,000 USD and an upward of 1M USD. We are no rich folks. It is just that we both have houses under our names before marriage and these are what potentially push us over the limit.


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## CapnBilly

extranjero said:


> Cap,n Billy, i have read that UK bond are only taxed when cashed, with a chargeable gain certificate. yet if they are declared on the 720, would the yearly profit have to be declared on the income tax declaration? If so they would be taxed twice. I know some UK bonds are not approved in Spain, but thousands of people in Spain have had them for years-what are they supposed to do?


Have to be honest and say I only know a little about these, as I don't have any of these investments. Any comments would just be my view, so I find it better not to comment.


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## CapnBilly

kimuyen said:


> So the 700,000 limit is per person? I know it sounds like a lot of money even for 700,000 euros but where we live in the States things are so expensive that a townhouse could cost move than $500,000 USD and an upward of 1M USD. We are no rich folks. It is just that we both have houses under our names before marriage and these are what potentially push us over the limit.


I sympathise with you, as nobody likes paying tax, but the rates are quite low initially. A couple with a assets of $3.5 m (dollars) would pay about $1100. As long as you know about it, then you can take it into account in your calculations of the economics of moving.


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## Chopera

kimuyen said:


> So the 700,000 limit is per person?
> 
> I know it sounds like a lot of money even for 700,000 euros but where we live in the States things are so expensive that a townhouse could cost move than $500,000 USD and an upward of 1M USD. We are no rich folks. It is just that we both have houses under our names before marriage and these are what potentially push us over the limit.


From the Spanish point of view that does make you rich folks though. Also another complication is pension funds. In Spain people rely on the state pension and don't normally invest in pension plans. In other countries the state provides very little in the way of pensions and people are expected to save into a private pension. But from the Spanish point of view, do pension funds count as wealth and are they subject to wealth tax?


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