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We purchased a house about 6 months ago in Spain. It's a big project and needs renovation which we are currently undertaking. We are still living and working in the UK and we go once or twice a month for a day or so to do odd jobs and meet trades people.

We want to get the Spain asap as soon as our new house is ready to move in to. But equally we want to sell our main house in the UK without having an capital gains tax liability on our UK house - which is our current home. We will spend some of the funds from our UK sale on our Spanish property and invest the rest.

Must we sell the house before we leave? Or can we move, then put the house on the market and sell it our leisure in a few months from now?

Ideally we would like to do a few jobs on the UK house to spruce it up before putting it on the market. But we want the simple route and preserve all the equity we have in our home in the UK.

If anyone can give us an sage advice we would be very appreciative.
 

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If you are tax resident in Spain then the sale of your property in the UK will be subject to CGT both in Spain and the UK.

You are resident in Spain for tax purposes if any of the following apply:

You spend more than 183 days in Spain in one calendar year. This is whether or not you take out a formal residence permit. These days do not have to be consecutive. Temporary absences from Spain are ignored for the purpose of the 183-day rule unless it can be proved that you are habitually resident in another country for more than 183 days a calendar year,
Your “centre of economic interests” is in Spain, i.e. the base for your economic or professional activities is in Spain.
Your “centre of vital interests” is in Spain – i.e. your spouse lives here (and you are not legally separated), and/or your dependent minor children do. In this case you are presumed Spanish resident, unless proven otherwise, even though you may spend less than 183 days per year in Spain.

If on the other hand, if you are tax resident in the UK then the sale of your main residential property will not attract CGT
 

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Totally agree sell your UK house, preferably on or before the final year your tax resident in the UK. As long as it's always
been your main primary residence up to the year you sell it. Then there should be no quibble about receiving the proceeds
of the sale free from UK CGT with ( of course ) nothing to declare in Spain.

Except for any savings in excess of 50,000 Euro's of course, although I'm sure your well versed in Modelo 720 as its
known by the Hacienda, once you become fully tax resident in Spain. This is on your worldwide savings and any
interest you gain from your savings, not just those in Spain.
 

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I sort of agree with you Meg, but we are in uncertain times just now, Brexit, hung parliament et al, not a good time to burn your bridges IMHO.
Each individual will have their own set of priorities.

For those who are in the fortunate position of being able to emigrate without the financial necessity of having to sell their UK property need to consider the tax implications of their actions.

Once you are tax resident in Spain you are then liable to pay income tax (both here and in the UK) on any rental income generated; capital gains tax (again both here and in the UK) on any profit on the sale; and the property is reportable via ‘Modelo 720’.

That said if you need that UK "bolt hole" and this is your major consideration then you need to be aware of the possible tax implications.

On the other hand, if tax is your key driver then clearly selling your UK property before emigrating makes perfect senses and totally alleviates any capital gains tax concerns.
 

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If you can possibly do it hang on to the UK house. We sold ours before our world travels in search of a new home, and really, really regret it for a number of reasons. One is having a foothold in the UK for things like a UK banking address. Another is the obvious one of having a back up should things not work out in Spain. Another is we don't know whats going to happen with Brexit. Hang on for a few years if you can.
 

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Bear in mind, as far as tax planning and planning your move is concerned, that although you might decide now or whenever to sell your house, the actual buyer might not appear for some considerable time, or might be there cash in hand tomorrow.
 

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Each individual will have their own set of priorities.

For those who are in the fortunate position of being able to emigrate without the financial necessity of having to sell their UK property need to consider the tax implications of their actions.

Once you are tax resident in Spain you are then liable to pay income tax (both here and in the UK) on any rental income generated; capital gains tax (again both here and in the UK) on any profit on the sale; and the property is reportable via ‘Modelo 720’.

That said if you need that UK "bolt hole" and this is your major consideration then you need to be aware of the possible tax implications.

On the other hand, if tax is your key driver then clearly selling your UK property before emigrating makes perfect senses and totally alleviates any capital gains tax concerns.
Also Spain does not offer or ( as far as I'm aware, never have or ever will do ) provide any Tax free or Tax exempt
savings or investment accounts, like the ISA on interest only or Self Select Share Dealing accounts and nothing like
SIPP's, that British residents have enjoyed for quite some time now - and think there's something wrong or
'behind the times' with Spain or the EU's stance with ISA's and SIPP's, that they cannot find the equivalent over here.
 
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