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Taxes to Pay

Posted: Fri Jul 31, 2020 10:33pm
7 replies141 views4 members subscribed
robjan1

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If the sale of my permanent residence in UK goes through in September 2020. Then we move permanently to my holiday home in Spain. Then apply for TIE before January 2021 would I be liable for any taxes in spain on the sale of my uk sale. 

Kelvin1960

Posted: Sat Aug 1, 2020 2:03am

Kelvin1960

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Posted: Sat Aug 1, 2020 2:03am

I think not.

Based on our experience, if you are granted Residency between now and June '21, you will be income tax-liable for Jan-Dec '21

jimtaylor

Posted: Sat Aug 1, 2020 6:01am

jimtaylor

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Posted: Sat Aug 1, 2020 6:01am

robjan1 wrote on Fri Jul 31, 2020 10:33pm:

If the sale of my permanent residence in UK goes through in September 2020. Then we move permanently to my holiday home in Spain. Then apply for TIE before January 2021 would I be liable for any taxes in spain on the sale of my uk sale. 

Provided the UK sale is completed and the proceeds in your bank before the end of this year, then there definitely won't be any tax liability in Spain.

robjan1

Posted: Sat Aug 1, 2020 7:45am

robjan1

Original Poster

Posts: 30

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Joined: 19 Sep 2017

Posted: Sat Aug 1, 2020 7:45am

jimtaylor wrote on Sat Aug 1, 2020 6:01am:

Provided the UK sale is completed and the proceeds in your bank before the end of this year, then there definitely won't be any tax liability in Spain.

Hi Jim, thank you so much for your reply. 

RayD

Posted: Sat Aug 1, 2020 4:33pm

RayD

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Posted: Sat Aug 1, 2020 4:33pm

jimtaylor wrote on Sat Aug 1, 2020 6:01am:

Provided the UK sale is completed and the proceeds in your bank before the end of this year, then there definitely won't be any tax liability in Spain.

But if it pushes your savings above 50.000€ it will be declarable on Modelo 720

jimtaylor

Posted: Sat Aug 1, 2020 4:50pm

jimtaylor

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Posted: Sat Aug 1, 2020 4:50pm

RayD wrote on Sat Aug 1, 2020 4:33pm:

But if it pushes your savings above 50.000€ it will be declarable on Modelo 720

True, but a 720 is information only, so doesn't incur tax.

robjan1

Posted: Sun Aug 2, 2020 3:57am

robjan1

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Posts: 30

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Joined: 19 Sep 2017

Posted: Sun Aug 2, 2020 3:57am

jimtaylor wrote on Sat Aug 1, 2020 4:50pm:

True, but a 720 is information only, so doesn't incur tax.

Thanks again for all the information. Looks like we will move over to spain mid August because of the threat of travel restrictions. The sale of our UK property should be completed September. The plan was to let the money from sale of property be deposited into our UK bank. Then go to our solicitors in Campoverde to get the TIE, Driving licence exchange before January 2021. Then January or February ask the solicitor to do our 720 form or form's . Last question would we have to fill in two forms my wife & I or just one if we moved all the assets to one joint account. Thanks Rob 

jimtaylor

Posted: Sun Aug 2, 2020 4:41am

jimtaylor

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Posted: Sun Aug 2, 2020 4:41am

robjan1 wrote on Sun Aug 2, 2020 3:57am:

Thanks again for all the information. Looks like we will move over to spain mid August because of the threat of travel restrictions. The sale of our UK property should be completed September. The plan was to let the money from sale of property be deposited into our UK bank. Then go to our solicit...

...ors in Campoverde to get the TIE, Driving licence exchange before January 2021. Then January or February ask the solicitor to do our 720 form or form's . Last question would we have to fill in two forms my wife & I or just one if we moved all the assets to one joint account. Thanks Rob 

Your planning is good, but some observations:

To prove your finances for residencia, having the funds in a Spanish bank would be acceptable, whereas funds in a UK bank might not be - depending on the attitude of the person who handles your application.

A gestor would normally be more topical on what is required than a solicitor would be, plus a solicitor would almost always charge more than a gestor - unless you're paying a solicitor an annual fee for all transactions.

A 720 is required for each person.

If, say, one of the asset categories is worth €50,000 but is jointly owned, a 720 is still required. You report the €50K but also report 50% ownership.

I'd argue that, because you aren't fiscally resident for 2020, a 720 isn't required to be submitted until 2022.

Bear in mind that you'll have to pay non-resident tax on your home here for all of 2020.

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