Planning your retirement in Spain

Spain remains a popular destination for British retirees and if you take specialist advice and follow the procedures correctly, you can continue to live the dream in Spain. Here are eight key wealth management steps to take as part of your journey.

1) Apply for your Spain residence visa

Applying for legal residence in Spain now involves stricter requirements and more advance planning and paperwork – but is generally still possible provided you can support yourself. Retirees can apply for a Spanish non-lucrative visa, or if you have capital to invest locally the ‘Golden Visa’ may be an option. Spain has also now introduced a digital nomad visa.

2) Understand the tax implications of living in Spain

You are a tax resident of Spain if you spend over 183 days here a year, or if your centre of economic or vital (wife/children) interests is in

By Cathal Rochford, Partner,

able for Spanish income, capital gains and annual wealth taxes on worldwide income and assets and subject to the succession tax rules.

3) Timing your move to save tax

The Spanish tax year runs from January to December, whereas the UK is April to April. The two countries apply different capital gains tax rules and rates. Weigh up assets as a UK or Spanish tax resident, then time your move accordingly.

4) Structure your assets to minimise tax in Spain

A potentially costly mistake is assuming what was tax-efficient in the UK is the same in Spain. ISAs, for example, lose their tax-free status here.

While Spanish taxation can look high, the tax regime presents attractive tax mitigation opportunities. The way you hold your assets can make a significant difference to how much tax you pay.

5) Research how UK pensions

are taxed in Spain

For residents of Spain, UK occupational and state pensions are taxed only in Spain. The taxation of UK private pensions is more complicated so take personalised advice. Government service pensions remain liable only to UK tax (though the income is taken into account in Spain when determining your income tax rate on other income).

able in Spain.

6) Analyse your pension options

Review all the available options and weigh up which is most suitable for you. For example, you might benefit from consolidating several UK pensions into one to provide a coherent, more cost-effective investment platform for your retirement income.

Note that transferring UK pensions to an EU Qualifying Overseas Pension Scheme (QROPS), after you are Spanish tax resident will incur a prohibitive tax charge in Spain, so take advice before you move.

Pension rules frequently change so the appropriate solution today may be slightly different tomorrow. The important thing is to take regulated, specialist advice before making decisions.

7) Reviewing your savings and investments you today, is designed to meet your aims and risk appetite, and has adequate diversification to reduce risk.

This is the time for a fresh review of your savings and investments.

Consider what currency to hold your savings in – keeping assets in Sterling puts you at the mercy of conversion costs and negative exchange rate movements.

8) Don’t forget estate planning

Spanish inheritance tax works very different from UK’s. Spain also restricts who you can leave assets to, though you can plan ahead to get round this.

A helping hand

It pays to do your research, but taking specialist cross-border advice will prove invaluable. Find a firm who can advise you for the longerterm, on all these various aspects, from the planning stages in the UK throughout your new life in Spain, and if you return to the UK in future.

Keep up to date on the financial issues that may affect you on the Blevins Franks news page at