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Capital Gains Tax on sale of UK home if over 65

Posted: Mon Apr 11, 2022 12:04pm
7 replies178 views3 members subscribed
lizziemac

Posts: 12

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Location: Albatera

Joined: 17 Jan 2016

Hello, me and my husband are planning to come to live in Spain, hopefully around October time.We will be selling our UK home before we leave but something has just worried me, I read a post that says that you have to pay Spanish capital gains tax on the sale if you become Spanish tax residents in the same year. I've also seen a mention somewhere that you are exempt from this if you are over 65, which we both are - but can't seem to find anything definitive on this. I would be very grateful for advice from someone who has experience on the subject.

Cheryl

Posted: Mon Apr 11, 2022 12:54pm

Cheryl

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Posted: Mon Apr 11, 2022 12:54pm

If you are moving over in October, you won't become tax resident in Spain until 1/1/23 therefore the sale of your UK property in the previous tax year is not taxable in Spain.

MarianT26

Posted: Mon Apr 11, 2022 1:43pm

Posts: 51

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Location: Rojales

Joined: 10 Apr 2017

Posted: Mon Apr 11, 2022 1:43pm

We moved to Spain in June 2018, sold our UK house in July 2018 and bought our Spanish home in September 2019. The UK house was in my husbands name ( he was 65 in August 2018). We used the proceeds from the sale of the UK house to buy our home in Spain. We did not have to pay CGT. Hope this helps.

Cheryl

Posted: Mon Apr 11, 2022 3:09pm

Cheryl

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Posted: Mon Apr 11, 2022 3:09pm

MarianT26 wrote on Mon Apr 11, 2022 1:43pm:

We moved to Spain in June 2018, sold our UK house in July 2018 and bought our Spanish home in September 2019. The UK house was in my husbands name ( he was 65 in August 2018). We used the proceeds from the sale of the UK house to buy our home in Spain. We did not have to pay CGT. Hope this helps.

In pre-Brexit days you could have been anywhere within the EU so I am assuming you got your Residencia July 2018 onwards which is the date the taxman will use. I don't thnk there is any getting away with that now!

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Kimmy11

Posted: Mon Apr 11, 2022 6:37pm

Kimmy11

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Posted: Mon Apr 11, 2022 6:37pm

Hi lizziemac,

Cheryl's correct, if you move to Spain in October this year, you won't become Spanish tax residents until 2023, so you wouldn't pay CGT in Spain.  Also, if your UK property is your main residence, you won't pay CGT in the UK either (there are a few exceptions to this rule, i.e. if the property has ever been rented out, even in part, if it's been used as a business address, or if it's of very high value).

For completeness because you mentioned it, the 65+ years of age rule applies to all Spanish tax residents (nationals and foreigners alike), who sell their main home in Spain.

Kind regards,

Kim

lizziemac

Posted: Mon Apr 11, 2022 7:21pm

lizziemac

Original Poster

Posts: 12

2 helpful points

Location: Albatera

Joined: 17 Jan 2016

Posted: Mon Apr 11, 2022 7:21pm

Kimmy11 wrote on Mon Apr 11, 2022 6:37pm:

Hi lizziemac,

Cheryl's correct, if you move to Spain in October this year, you won't become Spanish tax residents until 2023, so you wouldn't pay CGT in Spain.  Also, if your UK property is your main residence, you won't pay CGT in the UK either (there are a few exceptions to this rule, i.e. if the p...

...roperty has ever been rented out, even in part, if it's been used as a business address, or if it's of very high value).

For completeness because you mentioned it, the 65+ years of age rule applies to all Spanish tax residents (nationals and foreigners alike), who sell their main home in Spain.

Kind regards,

Kim

Thank you Kim, extremely helpful. Will the over 65 rule still apply if selling your main UK home?

Kimmy11

Posted: Mon Apr 11, 2022 8:10pm

Kimmy11

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Posted: Mon Apr 11, 2022 8:10pm

lizziemac wrote on Mon Apr 11, 2022 7:21pm:

Thank you Kim, extremely helpful. Will the over 65 rule still apply if selling your main UK home?

Hi lizziemac,

The "Over 65" rule is a Spanish CGT allowance, so it would apply if you were tax resident in Spain, selling your main Spanish residence.  As you will be a UK tax resident when you sell your UK property, UK CGT rules will apply.

Kind regards,

Kim

lizziemac

Posted: Tue Apr 12, 2022 8:32am

lizziemac

Original Poster

Posts: 12

2 helpful points

Location: Albatera

Joined: 17 Jan 2016

Posted: Tue Apr 12, 2022 8:32am

Kimmy11 wrote on Mon Apr 11, 2022 8:10pm:

Hi lizziemac,

The "Over 65" rule is a Spanish CGT allowance, so it would apply if you were tax resident in Spain, selling your main Spanish residence.  As you will be a UK tax resident when you sell your UK property, UK CGT rules will apply.

Kind regards,

Kim

That's great, thanks Kim

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