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Capital Gains Tax

Posted: Tue Apr 27, 2021 8:39pm
11 replies349 views6 members subscribed
Sligogent

Sligogent

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I   have  been researching  on moving to  Spain in  recent months  and got some very  helpful  information  along the way,  opened  my eyes a wee  bit,  plenty  to think  about,  so going  throw another query  out there  and  what  sort of hrlpful replies  I   get

I   now  understand that  if  I  get  my  Irish  pension paid into a Spainish  Bank  account  I  am  liable  for income  Tax, now  I  think  my pension  would alone  not  cover my day to  day  living expenses  in  Spain, As   soon as  I  purchase  a property  in Spain  ,  I  THINK  not  sure but I  will  have to apply  for Residence,  IF  i   sell  my  house  in Ireland  and  get funds  transfered  to  Spainish Bank  account,  I  will   become  liable for  Capital gains,  Is  this  correct,  as  Capital gains  is  24%  I  think,   Or  am  I  better  off  selling House in Ireland before  I  BECOME a  Resident   and  get  fund transfered as  I  would  rent a property  and live  like a tourist,  until fund can  be  transfered,  that  is  if  a  Bank  account can be  opened,  Reason  for selling house  is  to help  with living expenses, Sum transfered will  a  6  firgure sum

Would   be  greatful  to know  if  I  AM  understanding the  Tax  system  in  Spain  or  is  there  any legal  way  I  CAN avoid  a  Capital  gain  bill

JoB2021

Posted: Tue Apr 27, 2021 10:28pm

Posts: 15

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Joined: 28 Feb 2021

Posted: Tue Apr 27, 2021 10:28pm

Althpugh i cannot answer all your questions i think you may even find it hard to get your nie number now and renting for long term will be difficult without it, so you would be paying way over the top for holiday rental. My name is jo, call me on whatsapp711054628 if you ever want me to find out something over here.

Kelvin1960

Posted: Tue Apr 27, 2021 11:05pm

Kelvin1960

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Posted: Tue Apr 27, 2021 11:05pm

If you want to be in Spain >183 days per year, you become liable for income tax in Spain. How/where the money arrives is just mechanics.

To be able to spend >183 days/year in Spain, you must gain Residency (I am assuming you are Irish, not British - so it will work for you like it used to work for we Brits).

If you become tax-Resident in Spain before you sell your (Irish ?) house, you will be liable for CGT in Spain at - I think - 23%.

If you gain Residency in Jan-June of any year, you are tax-Resident in Spain for all of that year.

If you gain Residency in July-Dec of any given year, you become tax-Resident on 1st Jan the following year.

Once you become tax-Resident in Spain you must declare your worldwide assets (the Modelo 720 form). 

So ... best to sell in Ireland before moving to Spain.

Sligogent

Posted: Wed Apr 28, 2021 1:23am

Sligogent

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Posted: Wed Apr 28, 2021 1:23am

Kelvin1960 wrote on Tue Apr 27, 2021 11:05pm:

If you want to be in Spain >183 days per year, you become liable for income tax in Spain. How/where the money arrives is just mechanics.

To be able to spend >183 days/year in Spain, you must gain Residency (I am assuming you are Irish, not British - so it will work for you like it used to work for we Brits)....

...

If you become tax-Resident in Spain before you sell your (Irish ?) house, you will be liable for CGT in Spain at - I think - 23%.

If you gain Residency in Jan-June of any year, you are tax-Resident in Spain for all of that year.

If you gain Residency in July-Dec of any given year, you become tax-Resident on 1st Jan the following year.

Once you become tax-Resident in Spain you must declare your worldwide assets (the Modelo 720 form). 

So ... best to sell in Ireland before moving to Spain.

That   is   what   i    concluded  from  studying    Tax  rules  from forum  here,  So  need  to  be  a 120%  certain  that  moving  to Spain is  for  me, a  lot  to  think  about  over  next   12  months,  Taxes   and  Health  insurance  and existing  medical issuse  that  may  not  be cover,  pointing  to  a   unviable  move  at  the  moment,  400K  house  value    APPROX  100k  Tax  to  Spainish    government ,   would  those  figures  be  correct

Leafy211

Posted: Wed Apr 28, 2021 7:58am

Leafy211

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Posted: Wed Apr 28, 2021 7:58am

Might have some useful info

https://www.spectrum-ifa.com/would-you-like-to-avoid-spanish-taxes-on-your-property-and-investments/#:~:text=You%20bought%20a%20property%20in,gains%20tax%20allowances%20in%20Spain.

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Stevec61

Posted: Wed Apr 28, 2021 10:11am

Stevec61

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Posted: Wed Apr 28, 2021 10:11am

Sligogent wrote on Wed Apr 28, 2021 1:23am:

That   is   what   i    concluded  from  studying    Tax  rules  from forum  here,  So  need  to  be  a 120%  certain  that  moving  to Spain is  for  me, a  lot&...

...nbsp; to  think  about  over  next   12  months,  Taxes   and  Health  insurance  and existing  medical issuse  that  may  not  be cover,  pointing  to  a   unviable  move  at  the  moment,  400K  house  value    APPROX  100k  Tax  to  Spainish    government ,   would  those  figures  be  correct

I would employ the services of a tax adviser for your situation, can’t advise on any myself but I’m sure somebody on the forum will be able to?

Sligogent

Posted: Wed Apr 28, 2021 10:37am

Sligogent

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Posted: Wed Apr 28, 2021 10:37am

Leafy211 wrote on Wed Apr 28, 2021 7:58am:

Might have some useful info

https://www.spectrum-ifa.com/would-you-like-to-avoid-spanish-taxes-on-your-property-and-investments/#:~:text=You%20bought%20a%20property%20in,gains%20tax%20allowances%20in%20Spain.

Thanks  replying,  but  unfortunately  can't  open  it,  as  not in  Blue colour,  and  I  am  not   great  on  computer  

Kelvin1960

Posted: Wed Apr 28, 2021 2:08pm

Kelvin1960

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Posts: 1486

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Joined: 5 Mar 2017

Posted: Wed Apr 28, 2021 2:08pm

Sligogent wrote on Wed Apr 28, 2021 10:37am:

Thanks  replying,  but  unfortunately  can't  open  it,  as  not in  Blue colour,  and  I  am  not   great  on  computer  

The link is helpful. Copy and paste it into a new tab ... it works OK.

It more-or-less confirms what I said. 

Kelvin1960

Posted: Wed Apr 28, 2021 2:13pm

Kelvin1960

Super helpful member

Posts: 1486

1769 helpful points

Joined: 5 Mar 2017

Posted: Wed Apr 28, 2021 2:13pm

Sligogent wrote on Wed Apr 28, 2021 1:23am:

That   is   what   i    concluded  from  studying    Tax  rules  from forum  here,  So  need  to  be  a 120%  certain  that  moving  to Spain is  for  me, a  lot&...

...nbsp; to  think  about  over  next   12  months,  Taxes   and  Health  insurance  and existing  medical issuse  that  may  not  be cover,  pointing  to  a   unviable  move  at  the  moment,  400K  house  value    APPROX  100k  Tax  to  Spainish    government ,   would  those  figures  be  correct

As someone else said, you should get good tax advice before committing any money.

But yes, (selling price - buying price) x 23% is a big number.   (I'm assuming 23% is correct here).

Sligogent

Posted: Wed Apr 28, 2021 2:14pm

Sligogent

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Very helpful member

Posts: 1034

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Location: Torrevieja

Joined: 31 Jan 2021

Posted: Wed Apr 28, 2021 2:14pm

Kelvin1960 wrote on Wed Apr 28, 2021 2:08pm:

The link is helpful. Copy and paste it into a new tab ... it works OK.

It more-or-less confirms what I said. 

Nothing  appeared  arrived,  Thanks for  being  helpful,   Think   I    will   get  i  touch  with  a Tax  solicitors  whenever   I  get  out   to  Spain 

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