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Advice on living in Spain, moneywise
Advice on living in Spain, moneywise
by tel49 » Wed Apr 17, 2024 2:47 pm
I have been asked by my friend about taxation etc. First of all will he be taxed by Spain as he has only got an UK state pension to live on and he is in his 70s and does he need to fill in a regular tax form in Spain if he is below the UK/Spain pension threshold? Also as married is that needed for both or is there a joint allowance amount?
He or they are looking at renting only at the moment. I'm pretty sure he said too that their joint pension is less than £17000 a year and obviously they don't pay tax in the UK with it.
I'm not up to date on it as only just arrived back into Spain from a long holiday, sorry.
ps Hopefully I did tell him vehicle tax is usually paid in May every year LOL
He or they are looking at renting only at the moment. I'm pretty sure he said too that their joint pension is less than £17000 a year and obviously they don't pay tax in the UK with it.
I'm not up to date on it as only just arrived back into Spain from a long holiday, sorry.
ps Hopefully I did tell him vehicle tax is usually paid in May every year LOL
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Re: Advice on living in Spain, moneywise
by Graham_Lynn » Wed Apr 17, 2024 5:21 pm
If their income is only 17k per annum and if they are British passport holders, then they are well under the threshold to acquire residency in Spain.
But obviously different rules apply if they are EU passport holders.
If they are using savings to achieve the minimum income threshold then the interest from the savings will also need to be included in the tax declaration.
It’s one of those things that none of us are qualified to give a totally correct answer and they will need the advice of an accountant.
But yes they can be taxed as a couple, but that can make a difference to the amount they will pay any medication they require.
Rental prices have gone sky high recently, so depending on what type of property and area they are wanting to live in, their rent will eat up a high proportion of that income.
But obviously different rules apply if they are EU passport holders.
If they are using savings to achieve the minimum income threshold then the interest from the savings will also need to be included in the tax declaration.
It’s one of those things that none of us are qualified to give a totally correct answer and they will need the advice of an accountant.
But yes they can be taxed as a couple, but that can make a difference to the amount they will pay any medication they require.
Rental prices have gone sky high recently, so depending on what type of property and area they are wanting to live in, their rent will eat up a high proportion of that income.
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Re: Advice on living in Spain, moneywise
by Bee » Wed Apr 17, 2024 9:11 pm
Your UK State Pension would come under the Spanish tax system but if your annual income comes from a single source (i.e., just your pension) and it’s less than €22,000 a year, you do not have to file an annual income tax declaration. As a result, around 65% of pensioners in Spain are exempt.
Pensioners have slightly higher personal allowances. For example, those aged between 65 and 74 have an allowance of €6,700 a year and the over 75s benefit from an allowance of €8,100.
I think I have read where you should as a resident make an initial return even if you have no income tax liability so that you are registered on the system to avail of other tax benefits that might apply i.e no prescription charges and on the sale of property (I know it doesn't apply to you) you can avail of nil Capital Gains Tax. A Gestor is who you would get advice from in Spain re any income tax obligations you might have.
Bee
Pensioners have slightly higher personal allowances. For example, those aged between 65 and 74 have an allowance of €6,700 a year and the over 75s benefit from an allowance of €8,100.
I think I have read where you should as a resident make an initial return even if you have no income tax liability so that you are registered on the system to avail of other tax benefits that might apply i.e no prescription charges and on the sale of property (I know it doesn't apply to you) you can avail of nil Capital Gains Tax. A Gestor is who you would get advice from in Spain re any income tax obligations you might have.
Bee
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Re: Advice on living in Spain, moneywise
by p.edwards6 » Thu Apr 18, 2024 7:20 am
If your friends are British passport holders, you still will be only allowed to stay in Spain for 90 days in 180 days. If they want to live here, whether renting or buying you have to aquire a LNV which can been costly & time consuming. As for tax if you are resident here you get a duel taxation form one for the Spanish taxation & one for HMRC so you only pay your tax in the country of residency.The tax allowance is lower in Spain & you have to declare your worldwide wealth, so if you keep a house in the UK & rent it out you also have have to declare the rental income.
Hope this helps
Hope this helps
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Re: Advice on living in Spain, moneywise
by tel49 » Sat Apr 20, 2024 1:34 pm
Bee wrote:Your UK State Pension would come under the Spanish tax system but if your annual income comes from a single source (i.e., just your pension) and it’s less than €22,000 a year, you do not have to file an annual income tax declaration. As a result, around 65% of pensioners in Spain are exempt.
Pensioners have slightly higher personal allowances. For example, those aged between 65 and 74 have an allowance of €6,700 a year and the over 75s benefit from an allowance of €8,100.
I think I have read where you should as a resident make an initial return even if you have no income tax liability so that you are registered on the system to avail of other tax benefits that might apply i.e no prescription charges and on the sale of property (I know it doesn't apply to you) you can avail of nil Capital Gains Tax. A Gestor is who you would get advice from in Spain re any income tax obligations you might have.
Bee
Many thanks and I have talked to my friend and that if under €22k is good. He is 75 and asked if he then would be over that to a higher allowance even? Not sure
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Re: Advice on living in Spain, moneywise
by tel49 » Sat Apr 20, 2024 1:39 pm
Thank you for your replies guys, most helpful
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Re: Advice on living in Spain, moneywise
by Paul Uden » Sat Apr 20, 2024 2:58 pm
Definitely talk to an accountant or gestor. As others have said, a joint income of €17k is not sufficient to get their residence visa here. From memory I think the minimum is €36k now unless they have EU passports. So they would need other wealth which, if they have it, would also imply they have other sources of income such as savings interest, rental income or dividends. These are all taxable in Spain. I always thought the €22k limit referred to salaries for employed people and I'm not sure if it also applies to UK pensions.
This article explains a lot: https://www.expatica.com/es/finance/tax ... in-471614/
The most important advice from everyone in this thread is to go see an accountant over here as no one can be fully sure of your friends' circumstances or the tax implications.
This article explains a lot: https://www.expatica.com/es/finance/tax ... in-471614/
The most important advice from everyone in this thread is to go see an accountant over here as no one can be fully sure of your friends' circumstances or the tax implications.
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Re: Advice on living in Spain, moneywise
by roberthamilton » Sat Apr 20, 2024 4:34 pm
Good afternoon,
We enquired about this in February 2024 and were advised by the Spanish Consulate in Edinburgh that all Applications for NLV are now handled by BLS - website is https://blsspainvisa.com/edinburgh (as this is the nearest one to us)
Re the monetary requirements it says for the main applicant 2400 euros per month (£2131) and for each family member its an additional 600 euros per month (£532) . But it would appear that each case is treated on its own merits as other monies etc can be taken into account.
It would also appear that the personal tax allowance in Spain is considerably less than that in the UK as far as we have been informed.
As always best to seek professional advice before committing and all NLV visa applications have to be done in your home country (In our case Scotland.
Hope this is of some help
Robert
We enquired about this in February 2024 and were advised by the Spanish Consulate in Edinburgh that all Applications for NLV are now handled by BLS - website is https://blsspainvisa.com/edinburgh (as this is the nearest one to us)
Re the monetary requirements it says for the main applicant 2400 euros per month (£2131) and for each family member its an additional 600 euros per month (£532) . But it would appear that each case is treated on its own merits as other monies etc can be taken into account.
It would also appear that the personal tax allowance in Spain is considerably less than that in the UK as far as we have been informed.
As always best to seek professional advice before committing and all NLV visa applications have to be done in your home country (In our case Scotland.
Hope this is of some help
Robert
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Re: Advice on living in Spain, moneywise
by Darro » Sat Apr 20, 2024 7:02 pm
If true then unfortunately he has no chance whatsoever of getting an NLV to live in Spain. Even if if his wife has a full state pension their joint income still falls woefully short of the €36,000 pa required.tel49 wrote:he has only got an UK state pension to live on
And yes to Pauls observation that €22,000 refers to employed persons not retirees for whom the threshold is around €14,000.
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Re: Advice on living in Spain, moneywise
by Bee » Sat Apr 20, 2024 7:30 pm
I took the €22000 from Costa Luz Lawyers so I am sure it is correct. The income must be just from one source i.e one pension. As I read it if the income is from different sources i.e a private pension and the state pension and rental income then it is back to the normal tax bands starting at income tax band of up to €12450 and on up through the different bands.
Currently the Spanish income tax rates are as follows:
Spanish income tax for incomes up to €12,450: 19%
Spanish income tax for incomes ranging from €12,451 to €20,200: 24%
Spanish income tax for incomes ranging from €20,201 to €35,200: 30%
Spanish income tax for incomes ranging from €35,201 to €60,000: 37%
Spanish income tax for incomes ranging from €60,000 to €300,000: 45%
Spanish income tax for incomes over €300,000: 47%
The Andalucia Forum is very good on tax matters. This is their Faq on Income tax. You might glean an extra bit of information from it.
https://www.andalucia.com/forums/viewto ... 42&t=27576
Bee
Currently the Spanish income tax rates are as follows:
Spanish income tax for incomes up to €12,450: 19%
Spanish income tax for incomes ranging from €12,451 to €20,200: 24%
Spanish income tax for incomes ranging from €20,201 to €35,200: 30%
Spanish income tax for incomes ranging from €35,201 to €60,000: 37%
Spanish income tax for incomes ranging from €60,000 to €300,000: 45%
Spanish income tax for incomes over €300,000: 47%
The Andalucia Forum is very good on tax matters. This is their Faq on Income tax. You might glean an extra bit of information from it.
https://www.andalucia.com/forums/viewto ... 42&t=27576
Bee
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