UK Income but live permanently in Spain

[Nigtomdaw]

Hi, My family moved permanently to Spain in Sept 2006. We live mortgage free inthe countryside of Catalunya. I am 46 years old and have a private UK pension of £1000 per month after UK income tax is deducted which is paid in to my UK bank. I need advice on what is the correct thing to do. Obviously I take no services from the UK such as health care and use the Spanish services if required using my E111 card if required. I would like to pay my taxes in Spain and not the UK. Is this possible, as I am only 46 nearly 20 yrs from a state pension paying my dues in Spain would seem the correct choice. Also will I be better or worse off financially for doing this and what do I need to do to achieve this. I worked continually paying a full stamp for 25.5 years b4 retiring on health grounds I have not paid NI stamp in the UK since Sept 06. The only tax I pay in Spain is my rates for our land and property and refuse disposal.

If any more infomation is required please ask

[Stravinsky]

Originally Posted by Nigtomdaw

Hi, My family moved permanently to Spain in Sept 2006. We live mortgage free inthe countryside of Catalunya. I am 46 years old and have a private UK pension of £1000 per month after UK income tax is deducted which is paid in to my UK bank. I need advice on what is the correct thing to do. Obviously I take no services from the UK such as health care and use the Spanish services if required using my E111 card if required. I would like to pay my taxes in Spain and not the UK. Is this possible, as I am only 46 nearly 20 yrs from a state pension paying my dues in Spain would seem the correct choice. Also will I be better or worse off financially for doing this and what do I need to do to achieve this. I worked continually paying a full stamp for 25.5 years b4 retiring on health grounds I have not paid NI stamp in the UK since Sept 06. The only tax I pay in Spain is my rates for our land and property and refuse disposal.

If any more infomation is required please ask

Hi there

Well .......... some good news and some bad news.
Firstly, not only can you pay your taxes in Spain ...... in point of fact you have no choice, and if you came here in 2006 you should be putting in your first tax return in the next month or so. There is a tax treaty between Spain and the UK and you do not pay twice. You should de register for tax in the UK immediately with HMC&R as you will be liable for tax on your income from the day you became resident here. The tax you have paid in the UK can, if I remember correctly, be deducted from your first Spanish tax return. Allowances before tax iirc are about €13k a year here in Spain. Thereafter you''l be paying something between around 15 & 24%. Tax allowances in the UK have just changed, taking out the lower limits, so you might be better off.

Now the bad news. An E111 card, if its what I think you mean, is an EHIC card and is soley used for people who reside in the UK and go on holiday in the EU and is for Emergency treatment only. It doesn't cover you in Spain when you are a resident, and if you have managed to use it then you have been lucky. When you came here you should have obtained an E106 document from Newcastle and this would have entitled you to a limited amount of free health care in Spain, normally up to 2 years depending on your previous contributions. After that period you have no rights to health care in Spain under the National system unless you are contributing and have to take private health care. The only exception to this, and it is tenuous, is Valencia and some areas down South where its been reported that there is a free health care for all policy. However I live in Valencia area and I found this is not the case as I am no longer covered and have private cover.

Just be warned, that if anything serious happens you may find that you are not covered for treatment in Spain

For your taxes, my advice would be to get a good gestoria, as he knows the tax laws. Mine only charges €60 for a return. That will cover income tax and the Wealth tax also which is done at the same time

[chris(madrid)]

Just a point - as of this year if you tell a UK bank your address is in Spain - you'll find Hacienda now know all about you and are waiting to pounce!

[Stravinsky]

Originally Posted by chris(madrid)

Just a point - as of this year if you tell a UK bank your address is in Spain - you'll find Hacienda now know all about you and are waiting to pounce!

They wont need to pounce if you are doing your tax return

[Goldberg]

Speak to a lawyer, a tax advisor or gestor to get your papers in order.