April 18, 2018 at 4:10 pm #225071
Hello! This is my first post so please bear with 🙂
I live in the UK, however an internal job posting came up in the company I work for a few months ago based in Spain, and I have been accepted for it. I currently own my property (no debt or repayments required) and I’m thinking of selling it. However as far as I know selling the house would count as income, and I would need to pay tax on it, which would be rather expensive according to this tax tool. Will that matter if the money is transferred directly into my Spanish account or directly invested into my next house in Spain? I’m not sure how to go about this and was hoping somebody here will have done something similar (albeit maybe not in the UK) and have some advice.
Hope to hear from someone soon 🙂
April 20, 2018 at 9:20 am #225162
Sebastian – Barcelona, SpainParticipant
As far as I know, it depends on where are you currently living, but if the house you want to sell is in your country of origin, I do not know if you can tax your taxes there or if it is mandatory to do it in Spain. In my case, when I was looking for my house for sale in Barcelona, I recieved all the information and management from my real estate agent.
I let you some info about how foreigners pay taxes in Spain according to the law. I’m sorry, but the article is in Spanish.
April 21, 2018 at 10:31 am #225166
I am not a tax expert, and I would suggest you take proffessional advice both in U.K. and Spain.
For what it is worth, my layman’s opinion of your situation. I am assuming you are a U.K. citizen and the house you own in the U.K. is your main residence. If that is the case then you when you sell you will have no tax liability. Whilst U.K. remains in EU you would be able to transfer the funds to Spain (and should still be able to after Brexit, but that could still be a grey area).
If you are not a U.K. citizen and/or the house you own is not your main residence then you could be liable to capital gains tax on the profit you make on selling the house. The sale proceeeds would not count as income; but please take professional advice.
If and when you the day comes when you wasn’t to sell your Spanish house, that is a whole set of different rules.
- This reply was modified 7 months, 3 weeks ago by KevinXativa.
April 22, 2018 at 12:00 pm #225170
I suggest that you contact Simon Murphy at mymortgagedeal.co.uk He has all the requirements for UK and many years of experience in Spain having worked here for many years.
April 22, 2018 at 9:39 pm #225172
My wife (another Imogen) and I have done this twice, once from the UK to France and the second time from France to Spain, In both cases there was no tax to pay on the sale of our PPR (Principal Private Residence). There is no capital gains tax to pay in the country of arrival as long as you are not yet “tax-resident” in that country at the date of sale. This is perfectly reasonable from a Tax Inspector’s point of view as you would remain UK Tax Resident until the date of completion in the UK, only becoming resident in Spain once you move permanently. At that stage, we’d recommend asking your new colleagues for advice concerning a good English-speaking Gestor . For modest fees they keep you on the straight and narrow so far as Spanish bureaucracy is concerned. (You will find that bureaucracy is one of the major Spanish industries!) Don’t, however, forget the high rate of ITP (like Stamp Duty) payable in Spain, along with lots of more minor costs.
There is more information on the UK income tax implications can be obtained by searching for ‘HMRC leaving UK’. Lots of detail about the treatment of capital gains when selling your own house (PPR) can be found by searching ‘HMRC PPR relief’. I’ve tried quoting specific links, but they seem to be getting blocked, even from the domain gov.uk.
You might find it useful to talk to your Payroll Office or HR Dept. about your tax situation upon leaving the UK & after you move to Spain. There could be some issues concerning Income Tax depending upon whether your employment contract remains with a UK company or is transferred to a Spanish company. People in your company should be best-placed to help you with this, but it changes nothing so far as selling your house (PPR) tax-free is concerned.
Don’t forget to use a good broker (not your bank) when transferring significant sums to Spain. (I tried to suggest a couple, but got caught by the anti-spam system.) They can save you significant amounts of money, and sometimes guard against expensive risks such as seeing your capital in Pounds losing value compared with the Euro. There are plenty of such brokers: I’d shop around on the web, always basing your view on the true total amount in Euros that you would receive into your Spanish bank.
Hope your new life in Spain is as good as ours.
Disclaimer: This is based on our personal experience & is not professional advice.
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