# registration of foreign assets



## alfp (May 17, 2013)

Hello
Can someone explain the consequences of this development, as from 30th April. Does it only affect foreign owners of Spanish property for example, or anyone who spends at least 6 months is Spain. Clearly, this could be very sinister and will affect a lot of people who are by no means wealthy.
Thanks


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## xabiaxica (Jun 23, 2009)

alfp said:


> Hello
> Can someone explain the consequences of this development, as from 30th April. *Does it only affect foreign owners of Spanish property for example*, or anyone who spends at least 6 months is Spain. Clearly, this could be very sinister and will affect a lot of people who are by no means wealthy.
> Thanks


no - it's the other way around.... it affects people who are tax resident in Spain who have assets abroad

have a read of this http://www.expatforum.com/expats/sp...on-overseas-assets-spanish-tax-authority.html


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## mrypg9 (Apr 26, 2008)

And it affects *Spanish* people too.
Nothing 'sinister' about it.....it is the norm in most other countries including the UK to declare your foreign assets.


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## extranjero (Nov 16, 2012)

*assets*



mrypg9 said:


> And it affects *Spanish* people too.
> Nothing 'sinister' about it.....it is the norm in most other countries including the UK to declare your foreign assets.


However it is NOT the norm to have to give such detailed private, sensitive info on the form, which could open it to fraud


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## Campesina (Dec 17, 2011)

Especially on a web site where one has to override numerous security warnings in order to be able to use it.


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## alfp (May 17, 2013)

mrypg9 said:


> And it affects *Spanish* people too.
> Nothing 'sinister' about it.....it is the norm in most other countries including the UK to declare your foreign assets.


As long as the Spanish government isn't preparing for the kind of raid on peoples accounts that happened in Cyprus.


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## Chopera (Apr 22, 2013)

alfp said:


> As long as the Spanish government isn't preparing for the kind of raid on peoples accounts that happened in Cyprus.


If they think you have been witholding tax then they will raid your account.


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## xabiaxica (Jun 23, 2009)

Chopera said:


> If they think you have been witholding tax then they will raid your account.


precisely - if they reckon you owe them money, they'll just take it anyway!


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## Aron (Apr 30, 2013)

alfp said:


> Hello
> Can someone explain the consequences of this development, as from 30th April. Does it only affect foreign owners of Spanish property for example, or anyone who spends at least 6 months is Spain. Clearly, this could be very sinister and will affect a lot of people who are by no means wealthy.
> Thanks


Nothing sinister about anything. It is just an asset declaration for those who have €50000 in any one of three categories. There are many who think it sinister, but the UK authorities are tightening assets up in the UK for people with offshore accounts.


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## extranjero (Nov 16, 2012)

*assets*



Aron said:


> Nothing sinister about anything. It is just an asset declaration for those who have €50000 in any one of three categories. There are many who think it sinister, but the UK authorities are tightening assets up in the UK for people with offshore accounts.


The amount of detailed private and sensitive information required makes many uncomfortable, fearing it is open to abuse and identity fraud. I bet they are not required to give this depth of info in other countries


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## Aron (Apr 30, 2013)

extranjero said:


> The amount of detailed private and sensitive information required makes many uncomfortable, fearing it is open to abuse and identity fraud. I bet they are not required to give this depth of info in other countries


I told a relative in the UK what we went through. He told me, he had banked offshore for years in the UK, paid all his taxes, yet they still required from him what the taxman in Spain required of us. It may be intrusive, but it all falls under the European tax directive. 
What happens in other countries, I have no idea other than here and the UK. When I was in business many years ago, the taxman wanted to Know everything about me, surely we should expect the same in Spain or anywhere else we move to. I don't like it either, but then no one likes anything to do with taxes.


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## extranjero (Nov 16, 2012)

Do they really have to know:
The bank iban/bic, address,account number, when opened, when closed,average over last quarter of 2012,etc etc If the accountants computer is hacked and details used resulting in a loss from the clients account, will the bank concerned happily pay it all back?


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## Aron (Apr 30, 2013)

If someone can hack into the American security system, then what hope have any of us in our daily computer lives. As I said, I didn't like doing it, but like everyone else I'm complying. Now saying that,there are others who are not complying. I am a guest in Spain as well as being a resident. If the law requires it, I will comply. My home is in Spain, I love living here.
Lets face it, all of us and our personal details are on so many computers throughout Europe, or the world.


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## Chopera (Apr 22, 2013)

extranjero said:


> The amount of detailed private and sensitive information required makes many uncomfortable, fearing it is open to abuse and identity fraud. I bet they are not required to give this depth of info in other countries


Such as?


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## 90199 (Mar 21, 2010)

Just a paper exercise, not relative any more, mine has already changed drastically since December and by the end of this year will be almost completely unrecognizable, and providing the assets do not increase by more than €20,000, I shall not have to make a further declaration.


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## Chopera (Apr 22, 2013)

extranjero said:


> Do they really have to know:
> The bank iban/bic, address,account number, when opened, when closed,average over last quarter of 2012,etc etc If the accountants computer is hacked and details used resulting in a loss from the clients account, will the bank concerned happily pay it all back?


Governments in most countries have information about the accounts in their respective countries. They usually have access to the accounts as well. What's happening now is governments are beginning to share that information to prevent cross-border tax evasion. I don't see how the average tax payer should have a problem with this.


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## Aron (Apr 30, 2013)

Hepa said:


> Just a paper exercise, not relative any more, mine has already changed drastically since December and by the end of this year will be almost completely unrecognizable, and providing the assets do not increase by more than €20,000, I shall not have to make a further declaration.


I'm not sure if that is exactly the case. If you have assets in shares or bonds, then sell them, you have then to declare that. Your assets may not rise, but the taxman will want to know. That is my understanding of the declarations.


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## 90199 (Mar 21, 2010)

Aron said:


> I'm not sure if that is exactly the case. If you have assets in shares or bonds, then sell them, you have then to declare that. Your assets may not rise, but the taxman will want to know. That is my understanding of the declarations.


No, one only had to declare the overseas assets for last year to the Spanish inquisition, if you dispose of your assets and do not make a capital gain then you do not have to declare, either to HMRC or the Spanish inquisition. Should you then purchase overseas assets of a different kind, then providing they do not increase your previously declared assets by €20,000 a further declaration is not needed.


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## Aron (Apr 30, 2013)

Hepa said:


> No, one only had to declare the overseas assets for last year to the Spanish inquisition, if you dispose of your assets and do not make a capital gain then you do not have to declare, either to HMRC or the Spanish inquisition. Should you then purchase overseas assets of a different kind, then providing they do not increase your previously declared assets by €20,000 a further declaration is not needed.


This is where the problems may arise, and I was referring to overseas assets. There are conflicting views on that subject. One big issue with expats is premium bonds. That is viewed as an investment, not tax free like many believe. If you sell an asset such as a bond or shares, then open another investment, my advice given was that I would need to declare that. If you shift money from one account to another to gain a better interest rate, then no, you would not need to declare that.
With respect, I intend to bide by the advice given to me. If at the time it is found not to be necessary, then so be it. I have no problems with any of this!


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## Chopera (Apr 22, 2013)

Hepa said:


> No, one only had to declare the overseas assets for last year to the Spanish inquisition, if you dispose of your assets and do not make a capital gain then you do not have to declare, either to HMRC or the Spanish inquisition. Should you then purchase overseas assets of a different kind, then providing they do not increase your previously declared assets by €20,000 a further declaration is not needed.


If you have declared an asset and subsequently sell it then it is probably a good idea to declare that you sold it, even if you made no profit. Otherwise it will just stay in the system against your name. If you sell any asset at a profit and you are a Spanish tax resident then I'm pretty sure it is subject to Spanish CGT and they will want to know about it.


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## Stravinsky (Aug 12, 2007)

There's a story elsewhere of a guy that declared his house in the UK on the 720 that he bought in 2002 for £120k and sold in 2012 for £250k. Lived here in a rented house for 10 years in Spain. He now has a tax bill for €30k from the Hacienda

Costa News - First 'victim' of asset declaration

The moral of the story here is that anyone that has a property in the UK and is tax resident in Spain needs to look at their situation. They face hefty CGT bills, and if you declared it on the 720, the authorities now know about it


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## Aron (Apr 30, 2013)

Stravinsky said:


> There's a story elsewhere of a guy that declared his house in the UK on the 720 that he bought in 2002 for £120k and sold in 2012 for £250k. Lived here in a rented house for 10 years in Spain. He now has a tax bill for €30k from the Hacienda
> 
> Costa News - First 'victim' of asset declaration
> 
> The moral of the story here is that anyone that has a property in the UK and is tax resident in Spain needs to look at their situation. They face hefty CGT bills, and if you declared it on the 720, the authorities now know about it


Would like to read the whole story, but you can't unless you pay a subscription!


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## Stravinsky (Aug 12, 2007)

Aron said:


> Would like to read the whole story, but you can't unless you pay a subscription!


True, but the lesson is there. If you have a property in the UK and either rent or buy in Spain, if you declare on the 720 then the Spanish will take CGT if you sell in the UK at profit .... and if you are declaring the value of a UK house you have owned for many years, the profit could be huge (there are allowances)


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## Aron (Apr 30, 2013)

Stravinsky said:


> True, but the lesson is there. If you have a property in the UK and either rent or buy in Spain, if you declare on the 720 then the Spanish will take CGT if you sell in the UK at profit .... and if you are declaring the value of a UK house you have owned for many years, the profit could be huge (there are allowances)


I think if you lived in the UK and owned a house in Spain and were a UK tax payer, the same rules would apply regarding CGT. Certain people in the UK are being asked to declare overseas assets in the same way as Spain. It is all to do with the European tax directive.

I can't comment on the point in question until I've seen the article.


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## Chopera (Apr 22, 2013)

Stravinsky said:


> True, but the lesson is there. If you have a property in the UK and either rent or buy in Spain, if you declare on the 720 then the Spanish will take CGT if you sell in the UK at profit .... and if you are declaring the value of a UK house you have owned for many years, the profit could be huge (there are allowances)


The UK does the same - to an extent. If you have a property that is not your main residence then it counts as an investment and any profit on the sale is subject to CGT. The UK is more flexible when it comes to charging CGT on properties that have been your main residence, or if you sell your main residence and then move into rented accommodation: they won't charge CGT. But that's as much the UK being "nice" as Spain being "bad".

The bottom line is: if you declare on the 720 then you won't be able to evade Spanish CGT as so many have done so before.


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## Stravinsky (Aug 12, 2007)

Yes, I'm fully aware of CGT in the UK.

Maybe the Hacienda also give annual exemption allowances as the Uk does and allows you to back claim CGT allowances as well ...... I don't know, but its not something I've heard of mentioned.

As for the morals of this all? Well, you can live your whole life in the UK and maybe buy a house for a relatively small amount many years ago, rent a place in Spain for a year, and then sell for a good profit in the UK (money that never touches Spain) and then get taxed huge amounts of money by a country you've lived in for the blink of an eyelid.


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## Aron (Apr 30, 2013)

Stravinsky said:


> Yes, I'm fully aware of CGT in the UK.
> 
> Maybe the Hacienda also give annual exemption allowances as the Uk does and allows you to back claim CGT allowances as well ...... I don't know, but its not something I've heard of mentioned.
> 
> As for the morals of this all? Well, you can live your whole life in the UK and maybe buy a house for a relatively small amount many years ago, rent a place in Spain for a year, and then sell for a good profit in the UK (money that never touches Spain) and then get taxed huge amounts of money by a country you've lived in for the blink of an eyelid.


With respect, you don't actually know any of that, you are making an assumption. We can all be armchair lawyers or accountants. When I moved to Spain we decided to sell up in the UK so this is not something I have to deal with. Now saying that, I have a relative staying with me next week who deals in UK and worldwide tax. Hopefully I will get a clearer idea then


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## Megsmum (Sep 9, 2012)

Stravinsky said:


> Yes, I'm fully aware of CGT in the UK.
> 
> Maybe the Hacienda also give annual exemption allowances as the Uk does and allows you to back claim CGT allowances as well ...... I don't know, but its not something I've heard of mentioned.
> 
> As for the morals of this all? Well, you can live your whole life in the UK and maybe buy a house for a relatively small amount many years ago, rent a place in Spain for a year, and then sell for a good profit in the UK (money that never touches Spain) and then get taxed huge amounts of money by a country you've lived in for the blink of an eyelid.


But only if you were/are tax resident in Spain at the time of the sale. The person in question was tax resident in Spain when he sold his house in the UK, therefore subject to Spanish Tax Laws.


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## Aron (Apr 30, 2013)

The Brits are all getting worried about their tax requirements, me included. However, every morning I walk through our village. There are two guys I meet who are sleeping rough in their cars. They are always polite to me. This puts everything into perspective. We are all complaining about wealth, but those two guys are keeping their dignity as that is all they have left in the world.


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## Chopera (Apr 22, 2013)

Stravinsky said:


> Yes, I'm fully aware of CGT in the UK.
> 
> Maybe the Hacienda also give annual exemption allowances as the Uk does and allows you to back claim CGT allowances as well ...... I don't know, but its not something I've heard of mentioned.
> 
> As for the morals of this all? Well, you can live your whole life in the UK and maybe buy a house for a relatively small amount many years ago, rent a place in Spain for a year, and then sell for a good profit in the UK (money that never touches Spain) and then get taxed huge amounts of money by a country you've lived in for the blink of an eyelid.


But that's how it works for the Spanish as well. If a Spaniard sells their main home in Spain and goes to live in rented accommodation then they will find themselves subject to Spanish CGT on the sale of that property. If a foreigner becomes tax resident in Spain then the same rules apply. 

This is why anyone holding significant assets should speak to a specialist accountant before moving to a different country. Spain is no different!


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## jimenato (Nov 21, 2009)

Stravinsky said:


> There's a story elsewhere of a guy that declared his house in the UK on the 720 that he bought in 2002 for £120k and sold in 2012 for £250k. Lived here in a rented house for 10 years in Spain. He now has a tax bill for €30k from the Hacienda
> 
> Costa News - First 'victim' of asset declaration
> 
> The moral of the story here is that anyone that has a property in the UK and is tax resident in Spain needs to look at their situation. They face hefty CGT bills, and if you declared it on the 720, the authorities now know about it


If he sold it in 2012 why did he declare it on the 720?


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## Chopera (Apr 22, 2013)

jimenato said:


> If he sold it in 2012 why did he declare it on the 720?


Honesty I guess. You are meant to declare the relevant assets you own at the beginning if the tax year and any transactions you make. That's what he did. However he could have kept quiet and nobody would have found out. Fortunately he found out about the impending tax bill early enough in the year to still be able to get out of Spain and not be a Spanish tax resident this year, so he can avoid having to pay the tax. I wouldn't be surprised if in future years the Spanish authorities delay the tax bills until after June so people can't escape so easily!


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## peterinmalaga (May 27, 2013)

For me the moral of the story is that we should all spend our money NOW (there's no pockets in shrouds) or keep it under the bed. On no account should we keep more than the bare minimum in a Spanish bank. There is no point in saving in any case, because the interest gained on savings is an insult to those of us who have worked hard for what we have. Effectively we are losing money on our savings.
It is better to live in a large caravan on a campsite and move around the EU as the whim takes you. I wish I had known this before moving to Spain. Millions of Germans live that way with a pied a terre in Germany.


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## Aron (Apr 30, 2013)

peterinmalaga said:


> For me the moral of the story is that we should all spend our money NOW (there's no pockets in shrouds) or keep it under the bed. On no account should we keep more than the bare minimum in a Spanish bank. There is no point in saving in any case, because the interest gained on savings is an insult to those of us who have worked hard for what we have. Effectively we are losing money on our savings.


Well, everywhere is in crisis due to this bad recession. When everything is running smoothly and the economy is awash with money, nobody worries. The problem is, nobody learns from history. There have been huge financial crashes since money was invented. Had we all learned that a boom always ends up with a crash, we may not be where we are now. Make no mistake, this recession is going to last as long as the crash of 1873. During that one, the UK economy stagnated for 20 years. This current recession shows no signs of ending. Get used to it, it could be here for a while!


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## mrypg9 (Apr 26, 2008)

Simple message: if you worry about paying tax due in Spain maybe you'd be better off staying home. There seems to be a lot of immigrants who won't find life here stress-free. Relocating to Mablethorpe might be a better move than emigrating to Malaga...If you have money worries of any kind, it's probably best to stay home.
After all, as far as I know there's no human right to move around the world avoiding tax due.
The guy who got the fine was a tax avoider, if not evader, since he failed to report a capital gain to the tax authority of the state where he was a tax resident. 

I bought a property in Canada a few years back, sold it at a substantial profit before leaving the UK...and guess what? Paid tax on the CG. It's what you do.. You report, according to the rules. Did I enjoy handing over several £000 to the tax man? Of course not. Did I complain? No. I knew when I purchased the property what the outcome would be if it were ever sold.

Whether in Spain or the UK I use roads, various public services, enjoy the security of knowing I could call on the emergency services if needed...All paid for from general taxation. Yes, a lot of our money is wasted, a disgraceful amount, in fact. 

But that's an entirely separate issue.


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## Tilley (Jun 10, 2012)

peterinmalaga said:


> For me the moral of the story is that we should all spend our money NOW (there's no pockets in shrouds) or keep it under the bed. On no account should we keep more than the bare minimum in a Spanish bank. There is no point in saving in any case, because the interest gained on savings is an insult to those of us who have worked hard for what we have. Effectively we are losing money on our savings.
> It is better to live in a large caravan on a campsite and move around the EU as the whim takes you. I wish I had known this before moving to Spain. *Millions of Germans live that way with a pied a terre in Germany*.


And when said millions of Germany's sell these 'pied a terres' in Germany, thinking they have done all the right things to safeguard their monies, kids inheritances etc. They will be hit with a great big capital gains tax bill from the Spanish Tax Authorities.


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## 90199 (Mar 21, 2010)

Aron said:


> This is where the problems may arise, and I was referring to overseas assets. There are conflicting views on that subject. One big issue with expats is premium bonds. That is viewed as an investment, not tax free like many believe. If you sell an asset such as a bond or shares, then open another investment, my advice given was that I would need to declare that. If you shift money from one account to another to gain a better interest rate, then no, you would not need to declare that.
> With respect, I intend to bide by the advice given to me. If at the time it is found not to be necessary, then so be it. I have no problems with any of this!


Well there you are! typical Spain, I have taken advice and been given the contrary. I am making a great effort to drink all my assets


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## Aron (Apr 30, 2013)

Hepa said:


> Well there you are! typical Spain, I have taken advice and been given the contrary. I am making a great effort to drink all my assets


It's not just Spain, accountants and payroll managers have to keep taking refresher courses to keep up with changes in the law. We can all be critical of accountants, all we can do is trust the advice you've been given.

You on the other hand ar more fortunate than me. My doctor has told me that I can drink a maximum of two small glasses of red wine a day. Having said that, when the family visit they drink all my assets!


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## Tilley (Jun 10, 2012)

Aron said:


> It's not just Spain, accountants and payroll managers have to keep taking refresher courses to keep up with changes in the law. We can all be critical of accountants, all we can do is trust the advice you've been given.
> 
> You on the other hand ar more fortunate than me. My doctor has told me that I can drink a maximum of two small glasses of red wine a day. Having said that, when the family visit they drink all my assets!


Well I flippin well hope mine is going on a refresher course every year as he charges £800 per annum and although OH tends to deal with him, I would like to think some of that goes on keeping abreast with all the latest info. Although in fairness I guess he has saved us a lot over the years. Decent accountants are as as valuable as a good husband, wife, partner and need to be treated with the same respect I guess.


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## Chopera (Apr 22, 2013)

Aron said:


> It's not just Spain, accountants and payroll managers have to keep taking refresher courses to keep up with changes in the law. We can all be critical of accountants, all we can do is trust the advice you've been given.
> 
> You on the other hand ar more fortunate than me. My doctor has told me that I can drink a maximum of two small glasses of red wine a day. Having said that, when the family visit they drink all my assets!


That's the problem with having liquid assets


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## extranjero (Nov 16, 2012)

*Cgt*



Chopera said:


> Honesty I guess. You are meant to declare the relevant assets you own at the beginning if the tax year and any transactions you make. That's what he did. However he could have kept quiet and nobody would have found out. Fortunately he found out about the impending tax bill early enough in the year to still be able to get out of Spain and not be a Spanish tax resident this year, so he can avoid having to pay the tax. I wouldn't be surprised if in future years the Spanish authorities delay the tax bills until after June so people can't escape so easily!


As i understood it, he had already received the cgt bill for the tax year 2012,when he was tax resident so how could he escape it by going to UK in 2013?


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## extranjero (Nov 16, 2012)

Previously, when When people moved to Spain they didn't give much thought to tax(some still don't) and now they are being scared out of their wits at the thought of draconian punishments. The growth and ease of accessibility of computer records , transparency between countries and new asset reporting laws will have a significant effect on people moving here and moving back.Tax laws do not make Spain an attractive proposition,especially when what is tax free in UK is not in Spain. Another thing that doesn't help is the conflicting advice given by different accountants, some do not know how to treat financial products from UK eg bonds, savings plans etc.People often have no idea till too late of the impact of selling their house in the UK.Many would never have moved here if they had know of the repercussions.


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## Aron (Apr 30, 2013)

extranjero said:


> Previously, when When people moved to Spain they didn't give much thought to tax(some still don't) and now they are being scared out of their wits at the thought of draconian punishments. The growth and ease of accessibility of computer records , transparency between countries and new asset reporting laws will have a significant effect on people moving here and moving back.Tax laws do not make Spain an attractive proposition,especially when what is tax free in UK is not in Spain. Another thing that doesn't help is the conflicting advice given by different accountants, some do not know how to treat financial products from UK eg bonds, savings plans etc.People often have no idea till too late of the impact of selling their house in the UK.Many would never have moved here if they had know of the repercussions.


I understand what you are saying, but after living here for over 8 years, the thought of living in the UK fills me with more dread than the tax laws in Spain. We didn't leave the UK because we didn't like living there, quite the contrary. We left to find a better quality of life. We have found that here.
Now having said that, my gestoria does know about bonds and UK savings plans. Life is what you make of it. There is talk about droves of expats going back to the UK, but I have yet to meet just one from my area of Spain going back because of the tax law.


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## CapnBilly (Jun 7, 2011)

extranjero said:


> As i understood it, he had already received the cgt bill for the tax year 2012,when he was tax resident so how could he escape it by going to UK in 2013?


Just to be clear. He declared in the 720 for 2012, and sold it in January 2013. His advisor has now told him he will be liable for CGT in 2014. Pity he didn't tell him before he submitted the 720.


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## gus-lopez (Jan 4, 2010)

CapnBilly said:


> Just to be clear. He declared in the 720 for 2012, and sold it in January 2013. His advisor has now told him he will be liable for CGT in 2014. Pity he didn't tell him before he submitted the 720.


But the vast majority will only answer the question, if asked. They won't suggest various scenarios that could happen if you do various things.

still if he de-registers as resident before the 183 days & goes back to the uk he won't have to pay. Then he can return in 2014 & start again if he wants, with a pile of money & no property outside Spain.


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## Aron (Apr 30, 2013)

gus-lopez said:


> But the vast majority will only answer the question, if asked. They won't suggest various scenarios that could happen if you do various things.
> 
> still if he de-registers as resident before the 183 days & goes back to the uk he won't have to pay. Then he can return in 2014 & start again if he wants, with a pile of money & no property outside


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## snikpoh (Nov 19, 2007)

CapnBilly said:


> Just to be clear. He declared in the 720 for 2012, and sold it in January 2013. His advisor has now told him he will be liable for CGT in 2014. Pity he didn't tell him before he submitted the 720.


Why? He's still have had to pay it!!!!!!!!!!!

Unless, of course, you're suggesting he should not have declared it and committed tax evasion - quite illegal.


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## Aron (Apr 30, 2013)

I'm not sure about anything anymore. I have been reading so much conflicting news on this issue from other websites


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## extranjero (Nov 16, 2012)

How does this thread relate to the one posted by Cambio-cgt-lol-legal advice, in which it was debated whether if someone who sold their house in UK then moved to Spain in the same year, before July 2nd,had to pay CGT in Spain. She sought advice and was told she wasn't liable. Now regarding the man and his CGT bill for 30,000, is the difference that he sold it AFTER he moved to Spain?


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## xabiaxica (Jun 23, 2009)

extranjero said:


> How does this thread relate to the one posted by Cambio-cgt-lol-legal advice, in which it was debated whether if someone who sold their house in UK then moved to Spain in the same year, before July 2nd,had to pay CGT in Spain. She sought advice and was told she wasn't liable. Now regarding the man and his CGT bill for 30,000, is the difference that he sold it AFTER he moved to Spain?


of course it is - if you're resident in Spain then you're subject to Spanish tax rules............ & he was resident by the time he sold


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## extranjero (Nov 16, 2012)

*cgt*



xabiachica said:


> of course it is - if you're resident in Spain then you're subject to Spanish tax rules............ & he was resident by the time he sold


So advice given to cambio is correct?


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## CapnBilly (Jun 7, 2011)

snikpoh said:


> Why? He's still have had to pay it!!!!!!!!!!!
> 
> Unless, of course, you're suggesting he should not have declared it and committed tax evasion - quite illegal.


No I'm not saying that at all. I'm sure you know from my posts, that I would never advocate that. I was thinking more along the lines that if he had been advised better, then he would have had more time to plan it properly. It's just that he's now only got a few weeks to go back to the UK, and he's blaming the 720, which as we have discussed before, is not the case.

It is quite legal to go back to the UK and dispose of assets whilst you are a UK resident, to avoid spanish tax. That's tax avoidance which is legal. Staying in Spain and not declaring is tax evasion, which as you rightly point out is illegal.


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## CapnBilly (Jun 7, 2011)

extranjero said:


> So advice given to cambio is correct?


I have to say I'm not sure it is, but I haven't researched it fully, so I can't be certain. Having said that, it doesn't seem to be any different to me.


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## Chopera (Apr 22, 2013)

extranjero said:


> How does this thread relate to the one posted by Cambio-cgt-lol-legal advice, in which it was debated whether if someone who sold their house in UK then moved to Spain in the same year, before July 2nd,had to pay CGT in Spain. She sought advice and was told she wasn't liable. Now regarding the man and his CGT bill for 30,000, is the difference that he sold it AFTER he moved to Spain?


I'm not sure it does make a difference whether you sell before or after moving to Spain. If someone moves to Spain now, in May, then they are a Spanish tax resident for this entire calendar year, starting in January. Even if they sold their UK home in April before making the move, that sale would technically be subject to Spanish tax. There might be ambiguity if they sold in February because they could also claim to be a UK tax resident for the UK tax year up until April. I suspect the dual taxation agreement might then kick in, but that's where you need to take very good advice.


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## extranjero (Nov 16, 2012)

I've never seen any advice given to anyone about how when you moves affects cgt. It should be right up there with the advice about buying and selling properties.I have no doubt that thousands sold property in UK, moved the same year before July 1st, and had no idea that they could be liable for cgt on it. It's not something the average person would think of asking!


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## mrypg9 (Apr 26, 2008)

I may have missed this..but was this person receiving income in the form of rent for his UK house, do we know?

I tend to agree with Aron...if -and I can see why - the financial side is so important to you then you're better off at home.

We decided that we had enough for the lifestyle we wanted so closed our business and sold all our properties. We were lucky that they were sold before we came to Spain and were still UK resident although we had been in Prague for several months. I took out residency in the CR, Sandra didn't. We were always flitting around Europe that first year anyway and I spent half the year in the UK, or elsewhere in Europe. Moving to another country is itself quite stressful and the last thing needed on top of the 'usual' concerns are money worries of any kind.

If in doubt, don't pass 'Go' would be my advice.


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## CapnBilly (Jun 7, 2011)

extranjero said:


> I've never seen any advice given to anyone about how when you moves affects cgt. It should be right up there with the advice about buying and selling properties.I have no doubt that thousands sold property in UK, moved the same year before July 1st, and had no idea that they could be liable for cgt on it. It's not something the average person would think of asking!


I agree with that, and I have posted before about the advice that has previously been given. I read some Q & A's about CGT on a lawyers site over a period of 2 years, and the advice went from - ignore it, everyone else does - to - it is payable. I think the modelo 720 has really focused minds on this issue. I also think that the government has been aware of this (what I call tacit state approval), but because the cash was rolling in they haven't been concerned. But times they are a changing.


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## Chopera (Apr 22, 2013)

extranjero said:


> I've never seen any advice given to anyone about how when you moves affects cgt. It should be right up there with the advice about buying and selling properties.I have no doubt that thousands sold property in UK, moved the same year before July 1st, and had no idea that they could be liable for cgt on it. It's not something the average person would think of asking!


Exactly. And to be frank, I suspect most people get away with it without realising they have broken the law. But if they eventually do manage to link the UK land registry with the Spanish tax/residency systems, a few people might be in for a nasty surprise.


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## CapnBilly (Jun 7, 2011)

mrypg9 said:


> I may have missed this..but was this person receiving income in the form of rent for his UK house, do we know?


The article didn't say Mary, but I got the impression that he wasn't.

Actually, that will be the next thing. I think I posted on here months ago, about the consequences of the Modelo 720. CGT was one of them.

The next will be when the Hacienda ask people who have declared property why they haven't either been declaring rent, or paying imputed tax on a second home. Then there will interest income not declared etc, etc.

The one after that will be tax on UK inheritances, which will be a couple of years I reckon.


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## Chopera (Apr 22, 2013)

CapnBilly said:


> The article didn't say Mary, but I got the impression that he wasn't.
> 
> Actually, that will be the next thing. I think I posted on here months ago, about the consequences of the Modelo 720. CGT was one of them.
> 
> ...


I think the second home tax is for non-residents. A tax resident in Spain would not be subject to it.


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## Megsmum (Sep 9, 2012)

Chopera said:


> I'm not sure it does make a difference whether you sell before or after moving to Spain. If someone moves to Spain now, in May, then they are a Spanish tax resident for this entire calendar year, starting in January. Even if they sold their UK home in April before making the move, that sale would technically be subject to Spanish tax. There might be ambiguity if they sold in February because they could also claim to be a UK tax resident for the UK tax year up until April. I suspect the dual taxation agreement might then kick in, but that's where you need to take very good advice.





extranjero said:


> I've never seen any advice given to anyone about how when you moves affects cgt. It should be right up there with the advice about buying and selling properties.I have no doubt that thousands sold property in UK, moved the same year before July 1st, and had no idea that they could be liable for cgt on it. It's not something the average person would think of asking!


OOOHHHHH My name has been mentioned a few times here


Firstly I am no expert and have always said, it is up to each person to ensure that they are comfortable, with what they choose to do.

It is clear to me, from various bits of information that I have read that

It is not clear what the position re CGT on the sale of a UK property is with regards to the tax laws in Spain, and in true Spanish tradition I have had conflicting advice, from various tax people.

Therefore

If we do not complete our house sale in 2013, but end up selling in the Selling, in what would be deemed as the Spanish Tax Year Jan - Dec 2014, we will ensure that we do not become tax residents until after July 2nd 2014.

Simples.........If we decide to move before then, well. we pay CGT if they ask as that is the law.

The problem is, IMHO, and from what I have read, is that a lot of people who, moved to Spain, over the years, either thought they could avoid paying, or thought the system would be the same as the UK. As a caveat to that, we are in a fortunate position, that these are the questions that are asked now due to the 720 declaration. 
There is a world wide recession, this is going to happen everywhere. I know something is going to turn up and bite me on the (*&*(^& , hey ho.

I no longer worry about this stuff, I ask a question, I seek advice and then I make a decision. 

Paying CGT and Overseas tax on income is nothing new anywhere, it just, it seems to me, to be enforced by various governements due to the situation we now find ourselves in


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## CapnBilly (Jun 7, 2011)

Chopera said:


> I think the second home tax is for non-residents. A tax resident in Spain would not be subject to it.


The deemed income on second homes, also applies to spanish residents, as well as non-residents, so would include homes in the UK, which by definition cannot be your main residence.


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## Chopera (Apr 22, 2013)

CapnBilly said:


> The deemed income on second homes, also applies to spanish residents, as well as non-residents, so would include homes in the UK, which by definition cannot be your main residence.


sorry I was referring to the imputed income


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## snikpoh (Nov 19, 2007)

CapnBilly said:


> The deemed income on second homes, also applies to spanish residents, as well as non-residents, so would include homes in the UK, which by definition cannot be your main residence.





Chopera said:


> sorry I was referring to the imputed income



So was CapnBilly (I think).

If, as a Spanish resident, you have a property outside of Spain (UK for example), then you are liable for IMPUTED rental tax irrespective of whether you have it rented out or not.


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## Chopera (Apr 22, 2013)

snikpoh said:


> So was CapnBilly (I think).
> 
> If, as a Spanish resident, you have a property outside of Spain (UK for example), then you are liable for IMPUTED rental tax irrespective of whether you have it rented out or not.


If you are referring to modelo 210 then I think that's for non-residents only


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## peterinmalaga (May 27, 2013)

Tilley said:


> And when said millions of Germany's sell these 'pied a terres' in Germany, thinking they have done all the right things to safeguard their monies, kids inheritances etc. They will be hit with a great big capital gains tax bill from the Spanish Tax Authorities.


The Germans aren't that stupid. They don't stay here for 6 months and they have no assets here other than their caravan/camper and maybe a car.


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## gus-lopez (Jan 4, 2010)

A spanish tax resident has always been liable for CGT on a second home sold , wherever it was.
A UK citizen, living in spain but not resident ( illegal) , has always been liable for UK cgt.
Might be why the UK has announced that they are to investigate every property sold over the last 20 years with a view to finding undeclared CGT. Could come as a shock to a lot of people !


The gentleman in question who sold in january this year would, as a spanish fiscal residen,t be required to pay spanish cgt in 2014, but if he de-registers before the 183 days then he will not have to pay it ! 
Unfortunately he would then be liable for UK cgt as he would be a UK resident & sold a 2nd home , as he was a spanish resident when selling & cannot therefore say it is not a 2nd home .
There is the possibility that the UK would take the view that he was living with a partner here ,but in the present economic climate & if they consider that he has come back merely to avoid paying in Spain then they'll probably demand it.

Legally he has to pay in one or other country.


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## peterinmalaga (May 27, 2013)

Chopera said:


> If you are referring to modelo 210 then I think that's for non-residents only


Yes. What I am saying is that I regret becoming a resident in Spain because life (and death!) would be easier if I had retained my house in the UK and just come over here for 5 months and 29 days during the winter, living in a large caravan.


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## gus-lopez (Jan 4, 2010)

Tilley said:


> And when said millions of Germany's sell these 'pied a terres' in Germany, thinking they have done all the right things to safeguard their monies, kids inheritances etc. They will be hit with a great big capital gains tax bill from the Spanish Tax Authorities.


Most Germans rent .They are the lowest % homeowners in western europe.

Most Germans around here are owners & buyers now. They had their 'fire-sale ' about 10 years back when they had to repatriate money to Germany that had not been declared .

" Yes. What I am saying is that I regret becoming a resident in Spain because life (and death!) would be easier if I had retained my house in the UK and just come over here for 5 months and 29 days during the winter, living in a large caravan. "

I wouldn't have bothered retaining the UK house either. Just the motorhome. :lol:


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## CapnBilly (Jun 7, 2011)

Chopera said:


> If you are referring to modelo 210 then I think that's for non-residents only


The modelo 210 is for non-residents, but for residents there is a section on modelo 100 for the same thing (Its section C on the current model).

It essentially uses the same basis for calculation, but allows you to put the percentage ownership or usage. One of the keys for is for location, and there is a key for "located abroad". You put various bits of data in, and it works out the "Renta inmobiliaria imputada" (Its box 069)


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## Aron (Apr 30, 2013)

peterinmalaga said:


> The Germans aren't that stupid. They don't stay here for 6 months and they have no assets here other than their caravan/camper and maybe a car.


Well, I know Germans who are permanent residents. We have one in our street and several more in the village. 
The Germans aren't stupid and neither are we. Where do you get that notion from!


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## Stravinsky (Aug 12, 2007)

Aron said:


> With respect, you don't actually know any of that, you are making an assumption. We can all be armchair lawyers or accountants. When I moved to Spain we decided to sell up in the UK so this is not something I have to deal with. Now saying that, I have a relative staying with me next week who deals in UK and worldwide tax. Hopefully I will get a clearer idea then


With respect you dont know that I dont know that and you are making an assumption. In fact I do know that and I am not making an assumption. I have an accountant in the Uk. No one is an expert in worldwide tax


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## Stravinsky (Aug 12, 2007)

Chopera said:


> But that's how it works for the Spanish as well. If a Spaniard sells their main home in Spain and goes to live in rented accommodation then they will find themselves subject to Spanish CGT on the sale of that property. If a foreigner becomes tax resident in Spain then the same rules apply.
> 
> This is why anyone holding significant assets should speak to a specialist accountant before moving to a different country. Spain is no different!


Yes for sure, but people dont seem to grasp the underlying thing here. Ive discussed it many times in various places, and this is the only place where some are blinkered.

I know its the same both ways around.
I'm aware of the CGT Laws

I have never been concerned about taxes in Spain and the UK as I strongly researched everything before I came here ... for well over a year in fact.

My point has always been giving my intimate asset details to the Spanish Govt with the possibilities that they may instigate new taxes that I never expected or new about on my assets outside the UK

The Uk govt, I never had to do this. To a foreign government I do

Its choices, if you are happy with it then good luck to you. Some arent


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## Aron (Apr 30, 2013)

Stravinsky said:


> With respect you dont know that I dont know that and you are making an assumption. In fact I do know that and I am not making an assumption. I have an accountant in the Uk. No one is an expert in worldwide tax


With respect, I have forgotten what you originally said. There has been so much written on here on this subject, not just here but on other expat sites. Much of what has been written has been at times conflicting and confusing. We can and probably do make assumptions. 
As for the word expert, I don't remember using that Word, I have a close relative that has to deal with tax in a worldwide context!


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## Stravinsky (Aug 12, 2007)

Aron said:


> With respect, I have forgotten what you originally said. *There has been so much written on here on this subject, not just here but on other expat sites. Much of what has been written has been at times conflicting and confusing.* We can and probably do make assumptions.
> As for the word expert, I don't remember using that Word, I have a close relative that has to deal with tax in a worldwide context!



Heh heh, I'm with you there ..... 

I do wish (not aimed at you) that people would stop mixing up tax evasion with tax planning though. The 720 caused many people to review their situation. I have always paid my taxes, I have no problem with that. I wont leave myself at possible risk though, and thats what its always been about for me .... choices.

It seems to have been turned into a "if you dont like it leave" situation in some places. I was fine with it how it was, but not fine with how it might be when they have all my intimate asset details


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## Chopera (Apr 22, 2013)

CapnBilly said:


> The modelo 210 is for non-residents, but for residents there is a section on modelo 100 for the same thing (Its section C on the current model).
> 
> It essentially uses the same basis for calculation, but allows you to put the percentage ownership or usage. One of the keys for is for location, and there is a key for "located abroad". You put various bits of data in, and it works out the "Renta inmobiliaria imputada" (Its box 069)


This is interesting - I never realised that calculation was done on the modulo 100. Indeed there coud be a few more nasty shocks awaiting people.


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## Aron (Apr 30, 2013)

El Pais are reporting that the asset declaration saw 131,411 declarations which about 129,000 were individuals. The total amount being 87.7 billion euros


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## Stravinsky (Aug 12, 2007)

Aron said:


> El Pais are reporting that the asset declaration saw 131,411 declarations which about 129,000 were individuals. The total amount being 87.7 billion euros


Just think ..... if they could get just 10% of all that .............


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## Aron (Apr 30, 2013)

Stravinsky said:


> Just think ..... if they could get just 10% of all that .............


The figure of 131,411 looks a little on the low side when you consider the size of the population and the amount of expats, not just British, living as residents.


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## Chopera (Apr 22, 2013)

Aron said:


> The figure of 131,411 looks a little on the low side when you consider the size of the population and the amount of expats, not just British, living as residents.


I did my declaration at the last minute using the website (long story involving an expired passport and not being able to get hold of the electronic certificate) and they actually displayed a running total of how many declarations had been made. And it was around about that figure. I remember at the time thinking it was slightly on the light side.


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## mrypg9 (Apr 26, 2008)

I may have my assets sequestrated...i may step out in the rosd and die under the wheels of a bus.
Imo neither are likely - the second because there aren't many buses round here.

All this is based on 'what if?' Nothing more. So those with worries who choose to leave Spain will sleep easier at night.

Me, I sleep better in Spain. Full stop.


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## JaneyO (Sep 24, 2012)

Aron said:


> The figure of 131,411 looks a little on the low side when you consider the size of the population and the amount of expats, not just British, living as residents.



I was shocked to read such a low figure. Hope they spend their time and energy pursuing those who have assets and didn't declare and leave those of us that did alone!!


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## Overandout (Nov 10, 2012)

JaneyO said:


> I was shocked to read such a low figure. Hope they spend their time and energy pursuing those who have assets and didn't declare and leave those of us that did alone!!


Whilst I share your sentiments, the government has made no secret that the intention of this new reporting law (so-called the anti-corruption law) is to investigate the origins of assets held abroad.

So, whereas I agree with mrypg9 about the future risk of being taxed on assets being a hypothetical future worry, it is logical that the authorities investigate where these assets came from and if CGT / Inheritance tax / Income tax was properly declared when the assets were generated.

Why would they go after those who have not declared when they have a list of declarations to investigate first? No hunters ignore the easy prey becuase they like the thrill of a better chase, especially when they are hungry.


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## Aron (Apr 30, 2013)

Overandout said:


> Whilst I share your sentiments, the government has made no secret that the intention of this new reporting law (so-called the anti-corruption law) is to investigate the origins of assets held abroad.
> 
> So, whereas I agree with mrypg9 about the future risk of being taxed on assets being a hypothetical future worry, it is logical that the authorities investigate where these assets came from and if CGT / Inheritance tax / Income tax was properly declared when the assets were generated.
> 
> ...


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## extranjero (Nov 16, 2012)

*assets*

So what happens to someone, who, after living in Spain 5 years becomes tax legal, files his 720 form with his assets over 50, 000;some of the assets may be composed of money from the 5 years he wasn't paying tax in Spain, eg cgt, money from matured ins policies etc. if the tax man wants to know how and when he got those assets accrued from years ago, will he be penalised becuse he didn't declare them at the time?
It's hardly going to get those who want to legalise their tax affairs in Spain to come forward is it?


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## Overandout (Nov 10, 2012)

extranjero said:


> So what happens to someone, who, after living in Spain 5 years becomes tax legal, files his 720 form with his assets over 50, 000;some of the assets may be composed of money from the 5 years he wasn't paying tax in Spain, eg cgt, money from matured ins policies etc. if the tax man wants to know how and when he got those assets accrued from years ago, will he be penalised becuse he didn't declare them at the time?
> It's hardly going to get those who want to legalise their tax affairs in Spain to come forward is it?


Well, by filing the 720 he doesn't "become legal" if he didn't pay the tax on the gains in the first place.

If the money came from a return on investment, inheritance, profit on sales of assets during his time as a tax resident in Spain, then the tax man will want his cut.

Prior to the new law, certain tax liabilities "timed out" under the statutory limitations (I think 5 years in most cases), but these limitations have been removed now so it doesn't matter how long ago the person "obtained" the money, if they were tax residents at the time and didn't declare the gain, they will now be liable for the tax plus interest.

This is the reason for the huge fines for not delcaring. The idea is that it is better to come clean and have to pay the tax that may be due from years back, than not declaring and risk a huge fine for that.

It appears from the figures though, that most people have chosen to risk the fine for non-declarations than declare the assets and pay the back-tax!


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## Chopera (Apr 22, 2013)

I don't think the declaration requires you to list previous transactions, apart from the purchases of assets that you currently hold. You don't have to say where you got the money from in order to make those purchases. So if you own a house that you bought in 2001 then you must declare it. However if you sold that house in 2010 you don't need to declare in on the 720 form (although if you were tax resident in Spain at the time, the sale should have been declared to Hacienda at the time)


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## passiflora (Jun 28, 2012)

*Foreign assets*

Is there anything to stop me changing my account numbers once I've given them to the Spanish on the 720 form? Like many people, we are concerned about such detailed information being freely available(more or less) What's to stop us changing the numbers in case there's a hacker about??


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## Aron (Apr 30, 2013)

passiflora said:


> Is there anything to stop me changing my account numbers once I've given them to the Spanish on the 720 form? Like many people, we are concerned about such detailed information being freely available(more or less) What's to stop us changing the numbers in case there's a hacker about??


Tax office will have encrypted websites very much the same as your bank. Your own personal computer is more at risk than the Haciend's


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## extranjero (Nov 16, 2012)

Chopera said:


> I don't think the declaration requires you to list previous transactions, apart from the purchases of assets that you currently hold. You don't have to say where you got the money from in order to make those purchases. So if you own a house that you bought in 2001 then you must declare it. However if you sold that house in 2010 you don't need to declare in on the 720 form (although if you were tax resident in Spain at the time, the sale should have been declared to Hacienda at the time)


However, if you have a large sum of money sitting in your bank as at 31/12/2012, the tax man will want to know where and when it has come from-if from the proceeds of a house sold a few years ago, which wasn't declared, what happens?


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## Chopera (Apr 22, 2013)

I don't think you can do much damage by having someone else's bank account number anyway - apart from paying money into the account! People give out their account numbers all the time, it's pretty hard to do business otherwise.


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## Aron (Apr 30, 2013)

extranjero said:


> However, if you have a large sum of money sitting in your bank as at 31/12/2012, the tax man will want to know where and when it has come from-if from the proceeds of a house sold a few years ago, which wasn't declared, what happens?


If you were paying tax on the interest he will know that is the source. The taxman is not looking for people who pay their taxes, he's looking for those that don't.


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## Overandout (Nov 10, 2012)

extranjero said:


> However, if you have a large sum of money sitting in your bank as at 31/12/2012, the tax man will want to know where and when it has come from-if from the proceeds of a house sold a few years ago, which wasn't declared, what happens?


Exactly this ^^

If you sold a house in the UK in 2010 (whilst tax resident in Spain), making a profit which you didn't declare, but have since spent all the money, you are effectively in the clear.

But if that money was in your bank as at 31st December 2012 and Hacienda ask you to prove where it came from you'll struggle to justify it without exposing the fact that you sold a house whilst being tax liable in Spain....


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## Chopera (Apr 22, 2013)

extranjero said:


> However, if you have a large sum of money sitting in your bank as at 31/12/2012, the tax man will want to know where and when it has come from-if from the proceeds of a house sold a few years ago, which wasn't declared, what happens?


I don't think the 720 form requires you to declare where the money came from (I only declared property so I'm not familiar with that bit), you just need to declare that you have it. I think they are trying to start from scratch here - looking forwards rather than backwards. They don't have the resources or inclination to go chasing after taxes that might be owed from a couple of years ago. Lets face it, nearly everybody in Spain has had to deal with black money at some time, whether they liked it or not. They want to draw a line now - last year there was an amnesty allowing people to repatriate money from offshore accounts with only a 10% fine, no questions asked. It's part of an international push to clamp down on tax evasion from now on.


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## Overandout (Nov 10, 2012)

Chopera said:


> I think they are trying to start from scratch here - looking forwards rather than backwards. They don't have the resources or inclination to go chasing after taxes that might be owed from a couple of years ago. Lets face it, nearly everybody in Spain has had to deal with black money at some time, whether they liked it or not. They want to draw a line now - last year there was an amnesty allowing people to repatriate money from offshore accounts with only a 10% fine, no questions asked. It's part of an international push to clamp down on tax evasion from now on.


So why does the new law eliminate the statutory limitations that previously would have stopped Hacienda retrospectively applying the tax?


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## Chopera (Apr 22, 2013)

Overandout said:


> Exactly this ^^
> 
> If you sold a house in the UK in 2010 (whilst tax resident in Spain), making a profit which you didn't declare, but have since spent all the money, you are effectively in the clear.
> 
> But if that money was in your bank as at 31st December 2012 and Hacienda ask you to prove where it came from you'll struggle to justify it without exposing the fact that you sold a house whilst being tax liable in Spain....


They will not ask that question because in most cases it is impossible to answer. People have money in their acounts that they have built up over years, decades even, from a whole host of sources: work, bonuses, buying stuff, selling stuff, inheritances, gifts, etc.


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## Chopera (Apr 22, 2013)

Overandout said:


> So why does the new law eliminate the statutory limitations that previously would have stopped Hacienda retrospectively applying the tax?


Which new law?


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## Aron (Apr 30, 2013)

Overandout said:


> So why does the new law eliminate the statutory limitations that previously would have stopped Hacienda retrospectively applying the tax?


If there has been tax fraud, then it is the same in the UK and probably anywhere in the western world. Spain is not alone in that


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## extranjero (Nov 16, 2012)

*assets*



Chopera said:


> They will not ask that question because in most cases it is impossible to answer. People have money in their acounts that they have built up over years, decades even, from a whole host of sources: work, bonuses, buying stuff, selling stuff, inheritances, gifts, etc.


Many of those would have been subject to tax!


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## extranjero (Nov 16, 2012)

It is wrong that those who have never paid tax in Spain will not be punished for it because the tax office will not spend time and money chasing them, while those who have complied may have their assets scrutinised, in the hope of extracting yet more money out of them.


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## extranjero (Nov 16, 2012)

Chopera said:


> Honesty I guess. You are meant to declare the relevant assets you own at the beginning if the tax year and any transactions you make. That's what he did. However he could have kept quiet and nobody would have found out. Fortunately he found out about the impending tax bill early enough in the year to still be able to get out of Spain and not be a Spanish tax resident this year, so he can avoid having to pay the tax. I wouldn't be surprised if in future years the Spanish authorities delay the tax bills until after June so people can't escape so easily!


I do not see how he can avoid paying the tax if he goes back to UK now-he was resident when he sold the house in2012, so even if he stops being resident in 2013, he still owes it. as he was resident when he sold it.However, if he sold it in 2013 then he could go home this year before july, and avoid paying the cgt on it in 2014.


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## mrypg9 (Apr 26, 2008)

extranjero said:


> It is wrong that those who have never paid tax in Spain will not be punished for it because the tax office will not spend time and money chasing them, while those who have complied may have their assets scrutinised, in the hope of extracting yet more money out of them.


It is wrong that for years I paid what to me were huge amounts of tax on income, investments and Corporation Tax whilst the likes of the Barclay Brothers, Starbucks, amazon and numerous individuals paid little or no tax.
It is wrong -or I think it is -that I now pay tax on income that I was taxed on whilst earning it.
It is wrong that I am being pursued for tax owed from 2010 not because I hid any income or made a false declaration but because the untrained ill-educated twerps at HMRC made a mistake in their assessment.

All very very wrong.

But what can I do about it? I'm living a lifestyle many would envy and I don't intend to spoil my life by worrying about Hacienda grabbing my assets, imposing new taxes, the decline in the value of the £, the crisis in the eurozone, whether the UK will leave the EU and will Spain kick us all out, the rising cost of electricity, the increase in crime, the dastardly behaviour of some Brits...

Every day of my life since I was born I could have found many things to worry about, nearly all of them beyond my control or influence. But I didn't. I focused on the here and now. When 'bad' things happened, I coped using whatever strategies or possibilities were available. Yes, of course I made plans...but the best-laid plans go oft awry, as the poet said. And of course we all know about the Law of Unintended Consequences.
I survived, had a good life in the UK and I'm ******ed if I'm going to spend the last decade or so of my life fretting about the 'mights', 'maybes' and 'what ifs'.
Life's too short.


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## Aron (Apr 30, 2013)

extranjero said:


> It is wrong that those who have never paid tax in Spain will not be punished for it because the tax office will not spend time and money chasing them, while those who have complied may have their assets scrutinised, in the hope of extracting yet more money out of them.


That's pure conjecture!


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## gus-lopez (Jan 4, 2010)

extranjero said:


> I do not see how he can avoid paying the tax if he goes back to UK now-he was resident when he sold the house in2012, so even if he stops being resident in 2013, he still owes it. as he was resident when he sold it.However, if he sold it in 2013 then he could go home this year before july, and avoid paying the cgt on it in 2014.


He didn't sell in 2012 . He declared on the 720 that he owned it during 2012 . he sold it in january 2013. Therefore as long as he goes from spain before the 183 days then he will not have to pay. He would still be liable to pay in the UK though.


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## Chopera (Apr 22, 2013)

gus-lopez said:


> He didn't sell in 2012 . He declared on the 720 that he owned it during 2012 . he sold it in january 2013. Therefore as long as he goes from spain before the 183 days then he will not have to pay. He would still be liable to pay in the UK though.


By the sounds of it, the UK would be more flexible and attempt to tax the profit made on the house only while he wasn't living there, also taking into account money spent on renovating the place, etc


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## Chopera (Apr 22, 2013)

extranjero said:


> Many of those would have been subject to tax!


Yes but my point is if you've got say €50k in a bank acount that you have been depositing in and withdrawing from on a monthly basis over 20 years, how can you say where that €50k has come from? It's an accounting nightmare, and I believe you're only responsible for keeping the last 5 years statements anyway.


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## Overandout (Nov 10, 2012)

Chopera said:


> Which new law?



Ley 7/2012 del 29 de octubre. (The same law which spawned the need for the Modelo 720).

There is a pdf from la Agencia Tributaria with a summary of effects of the new law for the tax payer, but for some reason I can't paste in the link and its too long to type in manually!

Look for Ley "7/2012 resumen" in Google.

Then read the part about "Ganancias Patrimoniales no justificadas" and you will see that this law is anything but a measure for the future. Quite the contrary, it is a hunt for people who have earned money in the past and invested it abroad in the hope of escaping paying the tax on the gain.


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## mrypg9 (Apr 26, 2008)

Chopera said:


> By the sounds of it, the UK would be more flexible and attempt to tax the profit made on the house only while he wasn't living there, also taking into account money spent on renovating the place, etc


Do we know if he was receiving rental income from the house and if so did he declare it? I suspect many immigrants renting their UK properties don't.

Naughty naughty....


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## CapnBilly (Jun 7, 2011)

mrypg9 said:


> Do we know if he was receiving rental income from the house and if so did he declare it? I suspect many immigrants renting their UK properties don't.
> 
> Naughty naughty....


As I posted the other day, this will be the next thing all over the papers, particularly if they do something stupid, and don't declare it next month.


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## Aron (Apr 30, 2013)

Chopera said:


> Yes but my point is if you've got say €50k in a bank acount that you have been depositing in and withdrawing from on a monthly basis over 20 years, how can you say where that €50k has come from? It's an accounting nightmare, and I believe you're only responsible for keeping the last 5 years statements anyway.


That may be true. There are the usual time limits, but you need all your statements for that period. If you had none, then the tax man will want to know why not whether in Spain or the UK. It ma be then you have an accounting problem!


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## Chopera (Apr 22, 2013)

Overandout said:


> Ley 7/2012 del 29 de octubre. (The same law which spawned the need for the Modelo 720).
> 
> There is a pdf from la Agencia Tributaria with a summary of effects of the new law for the tax payer, but for some reason I can't paste in the link and its too long to type in manually!
> 
> ...


I don't see anything new about that though. That's fairly standard stuff - saying that they will back date tax if they find that assets/income wasn't properly declared. I'd be surprised if they didn't have a clause like that - if tax couldn't be restrospectively applied then the benefits for not declaring would outweigh the risks if you got caught. I don't read it as implying the Spanish authorities will go out of their way to investigate people's tax affairs prior to the introduction of the 720. They'll obviously go after some people if they think they can claw back enough tax to justify the costs of the investigation. However they don't have the resources to investigate everyone.


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