Even if you buy property in Spain and obtain a Spanish residence visa, you may not be tax resident there. The taxes that you pay when you buy a property in Spain will normally depend on whether you are tax resident there or not for tax purposes.
Tax residence is determined by a number of factors, so is important to consider the various requirements when planning to buy Spanish property or live in Spain, whether permanently or on an occasional basis.
It’s important to note that the following is intended as a general guide to some of the key points, but should not be taken as specific legal advice. We always recommend discussing your situation with a lawyer experienced in Spanish visa and tax requirements before investing in or moving to Spain.
How long will you be spending in Spain each year?
Is it 183 days or more a year (not necessarily continuously)? If so, you are likely to be tax resident there.
Is your main home in Spain?
If it is then you are likely to be tax resident there.
Are your immediate family (spouse and dependent children) based in Spain?
If so, you are likely to be tax resident in Spain.
Is your main economic interest in Spain?
If so, you are likely to be tax resident there.
Do you still have to pay taxes in the UK if you live in Spain?
If you do become tax resident in a new country, then you will normally stop paying taxes in your home country and only have to pay taxes in the country you now call home.
Do not be tempted to have selective amnesia when it comes to declaring taxes – the authorities in both Spain and the UK have clamped down on people who do not do things properly.
Sometimes you should declare something for tax purposes in one country and also in another. Spain and the UK have a Double Taxation Treaty which means that you don’t normally pay tax twice and can offset the tax paid in the other country against the tax that you would otherwise pay in your home country.
Need help buying property in Spain?
Our UK-based property law team are highly experienced in helping clients to buy and sell property in Spain, as well as handling a whole range of related issues, such as advice on tax residence.
With a thorough understanding of both UK and Spanish law, we can provide clear, reliable legal guidance in plain English, giving you the confidence to deal effectively with property in Spain.