Tax implications of selling a home in U.K. and buying in Spain in the same year.

Posted: Sat Feb 25, 2023 9:53pm

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Posts: 12

Joined: 22 Sep 2019

I’m a confused :

Think I have figured out how I apply for NLV with all the bells n whistles required to make a successful application. Not counting my chickens but assuming we jump through that hoop….

We intend to sell our U.K. home before moving to Spain. After a period of months renting 3 to 6 months maybe. We would like to buy a home in Spain . Iv read that’s it’s important to plan the time of year you sell in U.K. and buy in Spain to avoid paying tax in both countries

Can anyone tell me in very simple terms what this means if I want to sell in U.K. in July 2024 and move to Spain in September when should I buy in Spain to avoid paying tax in both countries for sale of my U.K. home…..

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Posted: Sun Feb 26, 2023 12:09pm

John123456

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Joined: 27 Feb 2021

Posted: Sun Feb 26, 2023 12:09pm

I'm sure you will appreciate there is no simple explanation to any tax regime. I'm not sure whether there is a tax specialist on this Forum who could give you precise information/advice according to your circumstances. You will no doubt receive lots of responses but these will be based on personal experience and tailored to the Forum members personal circumstances - one hat does not fit all.

I would recommend you engage a tax specialist. I have attached a couple of links that may provide you with some basics:

https://www.ageinspain.org/post/general-tax-information-spain

https://lifestylegroup.es/tax-in-spain/

https://www.expatica.com/es/finance/taxes/taxes-in-spain-471614/

https://www.immigrationspain.es/en/save-taxes-in-spain/

Posted: Tue Feb 28, 2023 3:29pm

Kimmy11

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Posted: Tue Feb 28, 2023 3:29pm

Hi Kim,

It's not about when you buy a property in Spain, but when you become tax resident here. The Spanish tax year runs from 1 January to 31 December, and tax returns are submitted a year in arrears. So if you sell your UK property in July 2024, ideally you don't want to make yourself tax resident in Spain before January 2025, so that your first tax return will be due for submission in 2026 (between March and June). This will be driven to some extent by when you receive your Non-Lucrative Visa. Once granted by the Edinburgh Consulate, you have up to 3 months to enter Spain, and from the date you enter Spain you have up to 1 month to apply for the TIE residency card.

Kind regards,

Kim

Posted: Tue Feb 28, 2023 11:06pm

Kimcosta63

Original Poster

Posts: 12

Location: La Zenia

Joined: 22 Sep 2019

Posted: Tue Feb 28, 2023 11:06pm

Kimmy11 wrote on Tue Feb 28, 2023 3:29pm:
Hi Kim,
It's not about when you buy a property in Spain, but when you become tax resident here. The Spanish tax year runs from 1 January to 31 December, and tax returns are submitted a year in arrears. So if you sell your UK property in July 2024, ideally you don't want to make yourself tax r...

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...esident in Spain before January 2025, so that your first tax return will be due for submission in 2026 (between March and June). This will be driven to some extent by when you receive your Non-Lucrative Visa. Once granted by the Edinburgh Consulate, you have up to 3 months to enter Spain, and from the date you enter Spain you have up to 1 month to apply for the TIE residency card.
Kind regards,
Kim

Thank you Kim Mmm it’s all very complex.

We will need to speak to a tax person nearer the time.

We had hoped to sell our home here in Scotland in spring / summer 2024, though we are watching the market closely.
Our very much layman reading of the rules suggest if we are selling our main home in U.K. to by our main home in Spain we should not be liable for capital gains. We hope that is correct…

I understand that this is not the case if it’s a 2nd home.

Assuming our NLV application is successful, we had hoped to move to Spain soon as practicable after selling here.

We will keep telling ourselves that very little worth having, is come by easily.
We really want to retire to Spain 🥰 so we will plod away …….