# Hi - thinking of emigrating to Spain



## Getting Warmer (Jan 28, 2020)

Hi everyone, my Wife and I are thinking of emigrating to Spain, my Wife’s general health improves greatly with the Sun and warmth. I realise that my questions might be a little too “general” but as I said we are at the very early stage.
We need to first find if we can afford to live there first, we are both retired and receive occupational pensions but not stage pensions yet (we’re 62 and 61) we will be able to fund the purchase of a house through the sale of our UK home but I need to have a (rough) idea of how much is costs to live in say the Costa del Sol.
I think our biggest monthly expense will probably be medical insurance, I understand this to be around 250€ a month? Is there a Spanish equivalent of Council Tax and if so, how much is that? What about utility bills, how do they compare with UK? How much is car fuel? Car tax?

As you can see I seem to have lots of questions and would be exceedingly grateful for any information which can help us on our journey.

Many thanks for taking the trouble to read this.


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## kaipa (Aug 3, 2013)

If you feel hard pressed financially then after next December living in Spain will probably not be doable due to higher financial living requirements. The very fact that you ask about Council Tax suggests you need a lot more research to get up to speed with things.To put it in a nutshell: Welcome to the Wonderful World of Brexit.


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## kaipa (Aug 3, 2013)

Oh and by the way if you were thinking of driving you would need to redo your driving test. In Spanish!!!


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## paulhe (Jan 2, 2018)

Getting Warmer said:


> Hi everyone, my Wife and I are thinking of emigrating to Spain, my Wife’s general health improves greatly with the Sun and warmth. I realise that my questions might be a little too “general” but as I said we are at the very early stage.
> We need to first find if we can afford to live there first, we are both retired and receive occupational pensions but not stage pensions yet (we’re 62 and 61) we will be able to fund the purchase of a house through the sale of our UK home but I need to have a (rough) idea of how much is costs to live in say the Costa del Sol.
> I think our biggest monthly expense will probably be medical insurance, I understand this to be around 250€ a month? Is there a Spanish equivalent of Council Tax and if so, how much is that? What about utility bills, how do they compare with UK? How much is car fuel? Car tax?
> 
> ...


Move now if you can. Rates are IBI , BIn collection Basura - I have a 2 bed townhouse in Garrucha, Almeria this year - IBI (council tax): 182.25€
Basura (bin bill): 75.4€ per quarter

electricitiy is quite expensive by Aus standards but speaking to my dad in uK about same
Paul


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## Lynn R (Feb 21, 2014)

Costs for IBI bills vary a great deal between different areas so you really can't form a reliable opinion of what you might have to pay from examples given by forum members. My IBI bill for a 2 bed atico apartment (not in a coastal town) is €443 per year, quite a bit higher than the previous poster, but we don't have a separate rubbish collection charge in my local authority. Also the charges don't come within defined bands like Council Tax in the UK, the amount payable is different for each and every property within the same local area, depends on the exact size plus lots of other factors, eg properties in rural areas where fewer services are provided have much lower IBI bills than urban ones do.

Utility bills also vary a lot depending on individual usage and what type of fuel is used for heating, cooking and heating water. Piped gas is much less widely available than it is in the UK, especially in the South of Spain so lots of properties use bottled butane or propane gas. It's quite cheap to use but not so convenient as gas bottles have to be either delivered to the home or collected from a local outlet and reconnected to appliances whenever they need changing. Our property is all-electric and my lowest monthly bill during the past year was €48 and the highest €80 (lowest in summer and highest in winter due to heating costs). Standing charges for electricity are high compared to the UK and are based on how many kw you are contracted to be able to use at any one time, so you need to be able to get your head around being conscious of how many appliances you are using at the same time because if you exceed your contracted number of kw the electricity supply will trip just as if there is a power cut. Wood burning stoves are also popular for heating in the winter (and it does feel very cold inside many Spanish properties during the winter, even if its sunny outside). Remember that the temperatures plummet as soon as the sun goes down and it doesn't get warm until late morning when the sun is quite high in the sky.

Spain has said that after the end of the post Brexit transition period (ie after 31 December 2020) UK citizens moving to Spain will be subject to the general immigration regime, ie will be treated the same as all other third country citizens. That means early retired people such as yourselves will need to be able to show a regular income of €32k per annum for a couple in order to be granted a non lucrative visa, plus have comprehensive private health insurance with no co-payments involved.


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## 95995 (May 16, 2010)

Is there not a Spanish capital gains tax issue if you move to Spain this year and sell your UK home this year in that if you go through all the processes to register as resident you become Spanish tax resident this year?


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## kaipa (Aug 3, 2013)

Everhopeful: I fear we are about to enter into the residency/ tax thing again! Someone is going to start saying that it is all okay to come here apply for residency but only live less than 180 days and not have to pay tax/ CGT etc. But it needs to be made clear that as far as the Spanish authorities are concerned if you have become a resident then you are immediately liable for tax in spain if it appears you wish to make spain your home and therefore your principal financial base. That is the default position. If you want to argue the 180 day position you will need to be upfront with the authorities and prove spain isnt your place of primary financial interest.


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## snikpoh (Nov 19, 2007)

EverHopeful said:


> Is there not a Spanish capital gains tax issue if you move to Spain this year and sell your UK home this year in that if you go through all the processes to register as resident you become Spanish tax resident this year?


All depends when you move.

If you move after June this year, then you probably won't be considered tax resident until NEXT year.


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## kaipa (Aug 3, 2013)

Because of the Brexit deadline people are panicking and trying to get residency then return to uk to sell houses and then not declare GCT by saying they are not spanish tax residents etc. I'm afraid the the Hacienda are not as stupid as people think. Last year people got rather nervous when letters were received re tax returns 2016. So be warned


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## kaipa (Aug 3, 2013)

I came to Spain in October 2016. I immediately tried to get residency but was refused on various grounds. I then employed a lawyer to try again. The lawyer told me to wait until after Dec 2017 as he pointed out that once I had residency I COULD be deemed a tax resident. He said if I wasnt registered I had 90 days where I could stay in spain but not be considered fiscally centred there. After Dec I got residency and was then deemed liable for spanish Tax. That is how it should done. Once you register as resident it is presupposed that spain is your principal centre of interest. If this wasnt the case there would be no need to have this caveat


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## xabiaxica (Jun 23, 2009)

snikpoh said:


> All depends when you move.
> 
> If you move after June this year, then you probably won't be considered tax resident until NEXT year.


You would be - from the date you register.

You wouldn't have to do a tax return until 2021 - for the year ending December 2020.


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## kaipa (Aug 3, 2013)

If you moved in June then yes you could argue that you spent less than 183 days in spain so not liable for tax but if you registered as resident in June then you MIGHT be deemed to have shown your intent to make spain your principal financial centre and would then face tax liabilities. I am pretty sure a professional lawyer would point this out to you whilst others might suggest the likelihood as being small. You dont have to any kind of expert to figure out what the intent of the law is


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## Alcalaina (Aug 6, 2010)

As I sit here in my house in southern Spain wearing mittens, a woolly jumper and thermal underwear, struggling to get the room temperature above 17ºC without bankrupting myself with massive electricity bills, watching TV footage of floods, snow, hailstorms, hurricane force winds and the devastation wreaked on the Mediterranean coasts by Storm Gloria, and recovering from the worst bout of flu I've ever had, I have to smile at the idea that people still believe living in "sunny Spain" will improve their health.

Just come and spend a winter here before you commit yourself to emigrating. You'll soon be pining for your centrally-heated, insulated home back in the UK.


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## 95995 (May 16, 2010)

snikpoh said:


> All depends when you move.
> 
> If you move after June this year, then you probably won't be considered tax resident until NEXT year.


Why not (if you go through the whole process of registering resident, which as I understand it in Spain makes you immediately tax resident for the current tax year). 

As I understand it, you are tax resident in Spain if any one of the following applies.


You spend more than 183 days in Spain in one calendar year. You become liable whether or not you take out a formal residency permit. These days do not have to be consecutive. (Temporary absences from Spain are ignored for the purposes of the 183-day rule unless it can be proved that the individual is habitually resident in another country for more than 183 days in a calendar year.)
Or, your “centre of vital interests” is in Spain, e.g., the base for your economic or professional activities is in Spain.
Or, your spouse lives in Spain and you are not legally separated even though you may spend less than 183 days per year in Spain

But I also understand that "centre of vital interests" could include the place where you own your only home for example, and is most certainly not restricted to the country in which you spend the most time, for example to earn your income, even if you pay tax there, especially if you register as resident in Spain. In fact, as I understand it, you may very well need expert tax advice to determine whether you are tax resident. But more importantly perhaps, as I understand it, if Spain considers that you are tax resident the date of tax residence can be taken to be the date you become properly registered as resident. Not only that, as I understand it, in that situation you become immediately tax resident for the whole of that calendar year.

Though of course I could be entirely wrong on this, especially since the most reliable links I can find (without spending many hours searching) seem to suggested that in the above case you should seek expert advice in relation to your individual circumstances, though admittedly I haven't searched using Spanish terms.

And yes, I do note that you say "probably" in your reply, but for people selling a property in the same year they move and fully register resident in Spain, it could be a bit painful and a very unwelcome surprise.


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## 95995 (May 16, 2010)

Apologies to all, whilst I was posting my reply to Snikpoh, several of you responded - and had I already seen those posts, I would not have responded at all, given that just happens to be my view.


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## kaipa (Aug 3, 2013)

I agree with you about what you say and aslo noted that the other poster was careful to say PROBABLY . So it is best to take professional advice about this because there are alot of post suggesting rather dubious interpretations of the law which should maybe not be taken as Gospel


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## Lakif (Jan 29, 2020)

I appreciate everyone's attempts to clarify the tax residency situation, but must admit to becoming more confused by the points made. 

I thought I had fully understood the determinants of tax residency when I read the old thread "Private medical insurance residency application", but it seems I may have jumped the gun.

As I understood it, the 183 day rule means tax residency in Spain occurs by default if spending more than this time in Spain in any calendar year. Spending less time than this cumulatively would not make an individual automatically tax resident, but there are two other criteria which may still confer fiscal residence.

If your spouse and/or dependent children live in Spain for the majority of the year, then your centre of vital interests is in Spain and you are also deemed fiscally resident, regardless of how long you yourself spend in Spain. 

The second criterion is that your centre of economic interests lies in Spain, whereby you either own the majority of your assets, or earn the majority of your income from the country of Spain. It is hard to see how this requirement could come into play automatically simply on the basis of applying for your civil residence certificate. 

It is my assumption, currently unfounded, that if an individual moves from the UK and then spends fewer than 183 days in Spain in any given calendar year, they will be deemed as UK tax resident by default because they are UK citizens, even if they fall short of the 183 days in the UK tax year required for UK default tax residency, since they also fall short for the Spanish tax year.

As has been said, there is no real substitute for tailored professional advice, but I had assumed that I had gotten my head around this particular issue.


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## kaipa (Aug 3, 2013)

Lakif: Hello. If you register as resident in spain then you are officially identifying spain as your home base. You cant then spend 183 days in UK every year so as to avoid paying spanish tax. You cant be resident in two countries at the same time. If you phoned the spanish tax man and told him you had just taken spanish residency but intend to spend the majority of the year in the UK because it is financially more advantageous he is not going to be too happy


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## paulhe (Jan 2, 2018)

Lakif said:


> I appreciate everyone's attempts to clarify the tax residency situation, but must admit to becoming more confused by the points made.
> 
> I thought I had fully understood the determinants of tax residency when I read the old thread "Private medical insurance residency application", but it seems I may have jumped the gun.
> 
> ...


Not sure if the Spanish authorities do consider 'domicile' status and 'residence' status as meaning sometimes the same and sometimes different. In the UK, though a complicated status 'domicile' is considered in a number of High Court (England and Wakes jurisdiction) authorities usually to do with education provision . here it is summarised with some examples for UK born, parents born UK intending to live EU

https://www.gov.uk/government/publi...e-domicile-and-the-remittance-basis-rdr1#cona

paul


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## kaipa (Aug 3, 2013)

I dont think domicile has any bearing on residency.


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## paulhe (Jan 2, 2018)

While i am on this subject it might be of interest to those persons seeking to move to Spain to live (or any EU country) with children post Brexit (actually I am not certain this has been negotiated as part of any agreement for those that live in Spain or move to Spain by end of transition period). If they live out of the UK they will not be allowed to return and take advantage of free state schooling or to be considered a home student for university purposes, it is little known that for example persons emigrating to Australia and later returning with children may not be allowed to enrol their children in a State school as a 'home ' child. University entrance would be on the basis of international paying (and therefore not eligible for the student allowances (which are minimal now) or the student loan scheme. international fees have to be paid up front usually. I know this from my own experience when my son was wanting to study in UK.
paul


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## paulhe (Jan 2, 2018)

kaipa said:


> I dont think domicile has any bearing on residency.


actually they are not mutually exclusive


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## paulhe (Jan 2, 2018)

you can be domiciled and resident. You can be resident but not domiciled, you can be domiciled but not resident


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## kaipa (Aug 3, 2013)

Another example of all this relates to a Swedish friend who is resident in Spain. She doesnt work in spain but works in sweden during the summer months and then on and off during the year. She always tells me how careful she needs to be about it as if the Swedish authorities find she has worked in Sweden for over a certain number of days she is then liable for Swedish tax. Apparently they are super efficient about this even being able collect Spanish bank details. Anyway, if she overstayed she pays tax on income earned. If she sells any shares, or receives gifts of money etc then all that is taxed in spain even if the gift or sale happened during the time she was in Sweden even if she was there for over 183 days. So if she were to work in Sweden for 184 days tax would be on the income but if she sold her house capital gains would be declared in Spain as that is her primary place of residence


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## kaipa (Aug 3, 2013)

Paulhe: not sure how domicile relates to the issue of tax liability in spain?


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## kaipa (Aug 3, 2013)

Paulhe: you posted earlier about UK people returning with children to UK after living abroad. My understanding is ALL children have the right to education in UK irrespective of parents status. UK universities are ( England) no longer free and it might be the case that UK nationals require 3 year residency although EU students are eligible for free tuition in Scottish universities


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## paulhe (Jan 2, 2018)

kaipa said:


> Paulhe: not sure how domicile relates to the issue of tax liability in spain?


I am not sure whether Spain has a concept (legal concept ) of domiciled status. domicile is about intention . prior to 2017 there were certain domicile rules in uK re CGT . Rules changed. but the point is the rules for tax on residents is different to those for non - residents who are domiciled . these are common law rules in the main and as Spain is not a common law jurisdiction they may not have such a distinction

paul


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## paulhe (Jan 2, 2018)

kaipa said:


> Paulhe: you posted earlier about UK people returning with children to UK after living abroad. My understanding is ALL children have the right to education in UK irrespective of parents status. UK universities are ( England) no longer free and it might be the case that UK nationals require 3 year residency although EU students are eligible for free tuition in Scottish universities



Kaipa

It may well be that UK returning school age children have a right to be enrolled not sure if for example that would apply to 16 +. We first came back in 2004 with a view to return and made enquiries in Norfolk to register , wasn't a problem if i recall but we went back and then my boy wanted to study at loughborough Uni as he was a promising middle/distance runner. he was told he had to apply as an international student. He would have had to return to uk live three years (not for the purpose of study) before qualifying as a home student.

yes, not free any more. Germany is the place, I know a young girl who is studying medicine and pays for accomodation only. A number of classes are in English (though she speaks German)! 

Paul


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## Lakif (Jan 29, 2020)

kaipa said:


> Lakif: Hello. If you register as resident in spain then you are officially identifying spain as your home base. You cant then spend 183 days in UK every year so as to avoid paying spanish tax. You cant be resident in two countries at the same time. If you phoned the spanish tax man and told him you had just taken spanish residency but intend to spend the majority of the year in the UK because it is financially more advantageous he is not going to be too happy


Thanks for that, but the distinction here is that the topic of conversation earlier was surrounding retrospective Spanish CGT on UK assets, not the tax Spain is likely to levy on an ongoing basis once considered tax resident there. There will be no attempt to jig the system to my benefit.

There is also a difference, as far as I understand it, between “taking” Spanish residency, implying an application for a civil residence certificate, and being deemed fiscally resident, as I was enquiring about earlier.

Using an example of a UK property sale taking place in March 2020 and being conducted by an individual resident in the UK for the full tax year, being the UK tax year 2019-2020, I’m finding it difficult to understand the basis for the Spanish authorities being able to levy any tax on the proceeds, even if that individual then makes Spain their home, so long as they spend less than 183 days in Spain for calendar year 2020. In that scenario, the UK considers you tax resident for the tax year 2019-2020, as you’ve been present in the country throughout the financial year, so any tax which might be owing on a disposal taking place in that financial year is paid to the UK. What happens for those months between the end of the UK tax year and the date of application for Spanish residency is unknown to me, but because the sale took place in the UK tax year, there should be no CGT to pay in Spain, as I see it.

Being that this could potentially affect me greatly in a financial sense, I plan to take some official advice when the time comes to make the move. I just didn’t want anyone reading the thread to be misinformed, as some points made contradict what I’ve read elsewhere.


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## kaipa (Aug 3, 2013)

The way I see it is : If you sell your property in UK in March and then come to Spain in July , for example, you would then probably not have to declare the CGT in spain. HOWEVER if you register for residency either before March or let's say even June then you would be indicating that your financial place of interest is spain and therefore POSSIBLY be liable for tax for 2020 tax year. 
Basically as soon as you take residency you will be expected ( and automatically reminded) of the need for a tax declaration. Most people are registered with lawyers who come April/May contact their resident clients and remind them to book appointments to do tax returns


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## baldilocks (Mar 7, 2010)

As Lynn says, it depends on where you are. We live inland in Andalucía and our annual rates (IBI) are 295€ p.a. and our water/rubbish billis about 42€ per quarter. Our car tax is 55€ per annum for a 5 year old Citroën Berlingo Multispace.

Our house has 5 floors with 4 beds and 1 bath plus an apartment (1 bed and 1 bath) with potential for two/three more beds and another bathroom in the liveable attic, hence the higher IBI.


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## kaipa (Aug 3, 2013)

Lakif: The only really full proof way of doing this is. Sell the house in March 2020 remain in UK until Jan 2021. That way you will totally legally not need to pay any CGT in spain. To be a little less safe but probably okay is move to spain October 2020 and apply for residency after 90 day period which would put you in a new spanish tax year. All other options might carry risks. What you mustn't do is apply for residency before selling because then it will be tax avoidance if you dont declare and are checked. The other option is buy a property in spain with all the proceeds of uk sale within same tax year.


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## paulhe (Jan 2, 2018)

Getting Warmer said:


> Hi everyone, my Wife and I are thinking of emigrating to Spain, my Wife’s general health improves greatly with the Sun and warmth. I realise that my questions might be a little too “general” but as I said we are at the very early stage.
> We need to first find if we can afford to live there first, we are both retired and receive occupational pensions but not stage pensions yet (we’re 62 and 61) we will be able to fund the purchase of a house through the sale of our UK home but I need to have a (rough) idea of how much is costs to live in say the Costa del Sol.
> I think our biggest monthly expense will probably be medical insurance, I understand this to be around 250€ a month? Is there a Spanish equivalent of Council Tax and if so, how much is that? What about utility bills, how do they compare with UK? How much is car fuel? Car tax?
> 
> ...


The alternative is to let out the uK property and rent for a while in Spain. Of course you may be liable to CGT if you eventually decide to sell UK, unless as other posters have mentioned you purchase a Spanish property using full proceeds of UK sale (less mortgage and other expenses). but with house values doing reasonably well in some part of uK that may be your best bet. there are some saving provisions re CGT for UK owned property that is not your sole residence if you can live there for 91 days in any year
As always seek independent legal and financial advice 

paul


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## paulhe (Jan 2, 2018)

kaipa said:


> Paulhe: not sure how domicile relates to the issue of tax liability in spain?


Hi Kaipa
there is an interesting article on conflict of laws and domicile

https://e-justice.europa.eu/content_which_law_will_apply-340-es-en.do?member=1

paul


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## Rich & Wendy (May 28, 2018)

kaipa said:


> Lakif: The only really full proof way of doing this is. Sell the house in March 2020 remain in UK until Jan 2021. That way you will totally legally not need to pay any CGT in spain. To be a little less safe but probably okay is move to spain October 2020 and apply for residency after 90 day period which would put you in a new spanish tax year. All other options might carry risks. What you mustn't do is apply for residency before selling because then it will be tax avoidance if you dont declare and are checked. The other option is buy a property in spain with all the proceeds of uk sale within same tax year.


Surely moving to Spain will no longer be an option in 2021 because the transition period ends at the end of 2020 ?


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## baldilocks (Mar 7, 2010)

Rich & Wendy said:


> Surely moving to Spain will no longer be an option in 2021 because the transition period ends at the end of 2020 ?


It is believed that there would be no problem to moving to Spain after the transition period it will be just under different (and more restrictive) rules.


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## paulhe (Jan 2, 2018)

Rich & Wendy said:


> Surely moving to Spain will no longer be an option in 2021 because the transition period ends at the end of 2020 ?


one can apply for a non - lucrative visa (if retired) or if you can comply with the other visa categories (student working etc). If non - lucrative likely you will require proof of income circa 31000 euros per couple per year. 
There is a golden visa type if you invest in a home 500000 euro minimum 

paul


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## NickZ (Jun 26, 2009)

https://assets.publishing.service.g...ent_data/file/507409/spain-dtc_-_in_force.pdf

I've said it before. Tax Residence is decided by the treaty. Not by either UK or Spanish law. 

The treaty also covers capital gains. Employment income. Everything else you might want .

If you sell before you move the gain is taxed in the first nation. If you sell after you move the property is still potentially taxed by the country the property is in.


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## Getting Warmer (Jan 28, 2020)

Alcalaina said:


> As I sit here in my house in southern Spain wearing mittens, a woolly jumper and thermal underwear, struggling to get the room temperature above 17ºC without bankrupting myself with massive electricity bills, watching TV footage of floods, snow, hailstorms, hurricane force winds and the devastation wreaked on the Mediterranean coasts by Storm Gloria, and recovering from the worst bout of flu I've ever had, I have to smile at the idea that people still believe living in "sunny Spain" will improve their health.
> 
> Just come and spend a winter here before you commit yourself to emigrating. You'll soon be pining for your centrally-heated, insulated home back in the UK.


Actually we were going to do exactly that! Firstly we want to see if we can afford it, stage 2 would be to rent accommodation for 3 months in the winter to see how it bears out, I’m not naive enough to believe that it’s a perfect place to live, want to see if the advantages outweigh the disadvantages. Regards.


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## Getting Warmer (Jan 28, 2020)

Many thanks to everyone who has taken the trouble to read my question(s) and to those who have commented. I’m new to this so I hope that my thanks are posted correctly. I’m going to continue with my research. Regards to all.


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## Alcalaina (Aug 6, 2010)

Getting Warmer said:


> Actually we were going to do exactly that! Firstly we want to see if we can afford it, stage 2 would be to rent accommodation for 3 months in the winter to see how it bears out, I’m not naive enough to believe that it’s a perfect place to live, want to see if the advantages outweigh the disadvantages. Regards.


They most definitely do. 

But everyone I've ever met (myself included) is caught out by how cold it gets indoors during the winter months. It can be 18ºC outside in the afternoon but once the sun goes down ... Just make sure you have a house that has a south-facing balcony or terrace where you can sit and warm up. And don't get one in a valley where the sun never gets above the mountains between November and February, like one couple I know!


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