Spanish Residency and Tax

Ian_W

alba37 wrote:

Patrimonio is only paid by non-residents.

That must be a recent change then? In his 2003 edition of "You and the law in Spain" David Searl says it applies to both. Non-residents pay only on their Spanish assets but on the full value, whereas residents get a 100,000+€ exemption [each for couples] but have to pay it on their worldwide assets.

Who said tax doesn't have to be taxing!

seven-day-weekend

I think due to EU law, Spanish residents now have to be treated the same as Spanish citizens for tax purposes.

alba37

Ian_W wrote:

That must be a recent change then? In his 2003 edition of "You and the law in Spain" David Searl says it applies to both. Non-residents pay only on their Spanish assets but on the full value, whereas residents get a 100,000+€ exemption [each for couples] but have to pay it on their worldwide assets.

Who said tax doesn't have to be taxing!

Sorry, it may be my information that's out of Date & you may be perfectly correct Ian... will have a look on the net now.

Seven-day-weekend, I am sure all will be fine regarding your will, as long as you got professional advice.

Who said tax doesn't have to be taxing!!!! So true!!!

Still reading about impuestos (taxes) but have found this in English regarding Inheritance Tax HERE

alba37

I was wrong! I found this:

"Residents have a tax break on wealth tax
As a resident you will receive a tax break 150,000€ on your Spanish property when making your Impuesto Sobre el Patrimonio or wealth tax declaration. If you jointly own the property with your spouse the tax break is doubled meaning that the first 300,000€ of your estate is not liable for tax. Non-residents receive no tax break."

I had never had experience with properties over 150,000€ and therefore was unaware of patrimonio over the threshold. More interesting info The Benefits of becoming resident

Mrs_pbradley936

So it's this Patrimonio tax that the OP was seeking advice on? There ought to be something written into law which tells you about all of this before you buy a property abroad. I would imagine that many people buying in Spain start off with the place as a holiday home and then as they get older they find they spend more and more time there until the come to a cross road of where they should be based. Not many realise the consequences of spending more and more time in a holiday home.

krisskross

The wealth tax in Spain is something paid by all non residents as it is assumed that the Spanish property is being rented out, and thus the authorities impose a tax on what they assume you get. It is quite a complicated mathematical formula based on the rateable value of the house. If there is joint ownership then the tax is doubled!

When a Spanish property is sold by a non resident 5% of the total is retained to pay the capital gains tax.

As to Spanish wills. i was told that an existing English will could be used but would need to be officially translated and notarised....expensive. A Spanish will was costing approx €120 to make. A gestor draws it up after discussion about your wishes then you have to see the Notary, with an interpreter to ensure you fully understand where you are willing your possessions, to have it legalised. If there is no will then the Spanish inheitance rules will apply.

If there are joint bank accounts and one partner dies the accounts will be frozen, often leaving the survivor with no accesss to cash, even to pay for the funeral, until after the will is proven.

alba37

pbradley936 wrote:

So it's this Patrimonio tax that the OP was seeking advice on? There ought to be something written into law which tells you about all of this before you buy a property abroad. I would imagine that many people buying in Spain start off with the place as a holiday home and then as they get older they find they spend more and more time there until the come to a cross road of where they should be based. Not many realise the consequences of spending more and more time in a holiday home.

No, it wasn't! We have started going OT and ended at patrimonio! The question was regarding grasscutter's English home! I can't see why they can't put in the children's name, I have known people to do that.

Mrs_pbradley936

alba37 wrote:

No, it wasn't! We have started going OT and ended at patrimonio! The question was regarding grasscutter's English home! I can't see why they can't put in the children's name, I have known people to do that.

You are right!