Living part year in Spain part in the UK

Information and questions about the Law in Spain and Andalucia.
PeterI
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Living part year in Spain part in the UK

Postby PeterI » Mon Aug 10, 2015 4:41 pm

I have owned a house in Spain for 8 years and used it for holidays, but next year hope to retire and spend about 8 months of the year in Spain and the rest in the UK. I will have a pension, but not state pension yet. I was planning to have my pension paid into my English bank account and transfer money to cover bills every now and then. I will not work in Spain. Where do I stand on residency, and on tax?

El Cid
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Re: Living part year in Spain part in the UK

Postby El Cid » Mon Aug 10, 2015 4:46 pm

If you spend more than 183 days in Spain in one calendar year, not necessarily consecutively, you will be deemed tax resident in Spain and liable for Spanish tax on your worldwide income.

The only exception to this is if you have a UK government pension. If so, that will still be taxed in the UK, but it will be taken into account in assessing the Spanish tax on any other income, such as a UK state or private pension or any other income such as UK rentals or investments.

Sid

PeterI
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Re: Living part year in Spain part in the UK

Postby PeterI » Mon Aug 10, 2015 4:51 pm

Thanks Sid, does that mean I will pay tax in the UK and then be taxed again in Spain?

El Cid
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Re: Living part year in Spain part in the UK

Postby El Cid » Mon Aug 10, 2015 5:14 pm

Yes and no.

Pension income can be paid gross in the UK, but you have to ask HMRC to do that. There used to be a simple procedure for doing this, but I think now you have to get a certificate of tax residency from the Spanish tax office to get HMRC to do this.

Someone who has done this recently may be able to help. In the meanwhile, you deduct any UK tax paid from any tax due in Spain on the same income. It will all get sorted eventually.

Rental income has to have tax paid in the UK and you can deduct that as you will also have to declare it in Spain.

Sid

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Enrique
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Re: Living part year in Spain part in the UK

Postby Enrique » Mon Aug 10, 2015 5:28 pm

Two thing to consider.....
1)Hay fever season in Spain .........
2) Hot and Humid Summer months.......

If you have problems with these then you could tip your 8 months to 182 days and keep your Tax in UK.

:idea:
UNIX is basically a simple operating system, but you have to be a genius to understand the simplicity.

elusive
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Re: Living part year in Spain part in the UK

Postby elusive » Mon Aug 10, 2015 6:01 pm

Or just dont anything,tell anyone. theres ppl living here full time who dont bother let alone those who only spend 6 plus months here.

re double tax. we are in the process of getting our uk rebate. after our spanish tax was paid we received a certificate of tax residency in the post maybe 6 weeks later. thats been sent of to hmrc with the double tax form

WoodlandHills
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Re: Living part year in Spain part in the UK

Postby WoodlandHills » Mon Aug 10, 2015 6:08 pm

How does on actually document this for the tax authorities? If I am getting close to the 183 days per annum in Spain, can I simply go on holiday in France, Italy or any other country? We are very seriously considering buying a second home in Spain to use not only to explore Spain, but as a base for travel Europe-wide. Between the time spent in the U.S. and the time spent out of Spain in any given year we would be below the 183 days, but our entry and exit stamps from the airport in Spain would show longer. How do you prove the time spent traveling out of Spain if you go by car? Credit card receipts?

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costakid
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Re: Living part year in Spain part in the UK

Postby costakid » Mon Aug 10, 2015 6:33 pm

If you have an EU passport you will not have entry and exit stamps.

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Enrique
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Re: Living part year in Spain part in the UK

Postby Enrique » Mon Aug 10, 2015 6:51 pm

Hi,
Unless you're a Celebrity or on Uncle Sam's watch list then nobody is bothered where you go or how long you stay.......that's the real world.
Ok we know the Rules and we can stick to them or........

As Mr WoodlandHills gets his passport Stamped on entry....guess its a None EU one

Just come over enjoy your stay , help support the Economy by spending all those $$$$$$$$

:D
UNIX is basically a simple operating system, but you have to be a genius to understand the simplicity.

WoodlandHills
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Re: Living part year in Spain part in the UK

Postby WoodlandHills » Tue Aug 11, 2015 1:27 am

I have dual nationality, I could enter on either. I was asking a theoretical question as the tax implications could be meaningful. I assume that no one wants to "fiddle" things in hopes one will not get caught.... I just wondered how one might prove ones lack of residency, so to speak, if presented with a tax bill.

El Cid
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Re: Living part year in Spain part in the UK

Postby El Cid » Tue Aug 11, 2015 7:56 am

There are various ways you could prove that you were out of the country. Mobile phone records, travel tickets, hotel bills, geo-tagged photos etc.

Sid

WoodlandHills
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Re: Living part year in Spain part in the UK

Postby WoodlandHills » Tue Aug 11, 2015 7:45 pm

Thank you. I know it is unlikely to be necessary, but I like to be prepared. I guess this will be an incentive to take at least one selfie a day!

markwilding
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Re: Living part year in Spain part in the UK

Postby markwilding » Tue Aug 11, 2015 11:45 pm

El Cid wrote:Rental income has to have tax paid in the UK and you can deduct that as you will also have to declare it in Spain.

Sid

I don't pay tax on my UK rental income. There is a form to fill out, which if I remember rightly the rental management company either told me about or sent me.

There is an agreement between Spain and the UK allowing it. I just pay the taxes here.

A quick google throws up the NRL1i form. I think this also depends if the UK income is lower than the tax threshold.

El Cid
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Re: Living part year in Spain part in the UK

Postby El Cid » Wed Aug 12, 2015 7:26 am

Rental income in the UK is "liable" for UK tax. Since you currently get all the UK personal allowances, it is possible that no tax will be due. If that is the case HMRC will allow you to have the rental paid without the usual landlords deduction.

If you had rental income above the threshold, you would, as I said, pay tax in the UK and have to deduct it from the Spanish tax.

Sid

markwilding
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Re: Living part year in Spain part in the UK

Postby markwilding » Wed Aug 12, 2015 9:59 am

Then if a couple earns less than about 21,000 pounds, filling out the form saves a lot of time and effort.

El Cid
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Re: Living part year in Spain part in the UK

Postby El Cid » Wed Aug 12, 2015 10:44 am

This is where people with UK government pensions take a hit, as their personal allowance will have been eaten up by the pension, leaving UK rental income taxed in the UK and the inevitable reclaim process in Spain.

If they only have the State pension taxed in Spain, there will be nothing to offset the UK rental tax against.

Sid

elusive
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Re: Living part year in Spain part in the UK

Postby elusive » Wed Aug 12, 2015 11:02 am

We filled in the non residents landlord form like mark but they have also asked us to do a self assesment inregards to the rental income.

markwilding
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Re: Living part year in Spain part in the UK

Postby markwilding » Wed Aug 12, 2015 11:42 am

I still have to do self assessment every year. The benefit is that I don't need to pay tax through the agents only to get a rebate the following year.


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