Capital gains tax on sale of uk property - Page 3

As long as you sale before you take residence in Spain there will be no CGT. Mabey it would be best to rent in Spain while you find you new home. 

What’s wrong with renting here?

Hi and thank you for clarifying that. I will come over for a couple weeks to view areas/properties.

Think u may need more than a couple of weeks to get to know a place. As Mathew allways says make sure you stay over winter period as things can be very different. Don't worry about rushing, rent in different places. At the end of the day it's how u feel not what the estate agent says your going to feel. 

James

Hi James yes your right. I have been loiking at properties in Almeria&Andalusia so i know what type of property im loiking for so limits to certain areas. I want some peace&quiet Lol as cant get it in UK

I seems to me that two separate issues are getting mixed up here. If you want to move to Spain and have no previous experience of an area then the rent before buy advice should be heeded.

On a completely separate subject if you are deemed to be tax resident in Spain when you sell a property outside Spain you will probably be liable to tax on the capital gain of that sale. Spain has a global taxation policy whereby you are taxed in Spain on your global income, sale of assets and total assets. Where taxation treaties exist between Spain and the Country of gain you maybe able to offset tax paid in that Country against your Spanish tax liability. If you are in this position you should be taking tax advice from experts in Spain and, probably, the Country of gain not from an Internet forum. 

You may want to argue that it’s unfair to have to pay tax on the sale of a property in a third Country if you are tax resident in Spain. However the timing of your becoming tax resident in Spain is wholly within your control. 

If you want an indication of how strongly the Spanish tax authorities will pursue you if they think you’re tax resident and not declaring or paying the appropriate taxes you might want to Google the case of the Colombian singer Shakira. She is married to the Barcelona footballer Gerard Pique and is currently being prosecuted for tax avoidance on approx  Eur14.5m of income.  The Spanish tax authorities are arguing that as she spent more than 183 days in Spain each year between 2012 and 2014 she was tax resident despite not applying for or having residencia.

Take professional advice and proceed cautiously.  

Thank you for that information. I will get tax advise as i may re-consider my move to spain as im not handing over thousands in Cgt on my uk home as im selling it to buy a property&to fund myself hence not be relying on benefits etc.

Lots to look at bit i hope it can be sorted.

Regards

As an aside to anyone thinking of paying lots in cash to get round any tax issues, I’ve just received the following from my Asesora (translation courtesy Google Translate):-

THE LAW AGAINST TAX FRAUD PROHIBITS CASH PAYMENTS GREATER THAN € 1,000

 Law 11/2021, of July 9, on Measures for the Prevention and Fight against Tax Fraud prohibits cash payments of more than 1,000 euros, new parameters have been introduced in tax justice to help prevent and fight against tax fraud .

 CASH PAYMENTS GREATER THAN 1,000 EUROS ARE FORBIDDEN

 Since July 11, 2021, the Law on Measures to Prevent and Fight against Tax Fraud prohibits cash payments greater than 1,000 euros or its equivalent value in foreign currency, that is, anyone who exceeds by paying more than said amount or admit charges higher than this amount you face significant penalties.  Payroll payment is also considered an operation.

 The objective of these limits is to try to reduce cash operations, which are more difficult to track to avoid fraudulent situations, shadow economy and thus minimize tax fraud, so we approach a total control of money movements with the final objective that the Government has the traceability of all operations.

 Law 11/2021, point 1 of section 1: "Operations in which any of the intervening parties act as an entrepreneur or professional, with an amount equal to or greater than 1,000 euros or its equivalent in currency, may not be paid in cash. However, the aforementioned amount will be 10,000 euros or its equivalent in foreign currency when the payer is a natural person who justifies that he does not have his tax domicile in Spain and is not acting as an entrepreneur or professional ”.

 • Employers or professionals when they act as such cannot make cash payments.

 • Individuals with tax domicile outside of Spain who do not act as an entrepreneur or professional have a cash payment limit of up to 10,000 euros.

 • Among individuals, the limit for cash payments is 2,500 euros.

 PENALTIES FOR BREACH OF THE LIMITATION OF CASH PAYMENTS

 Law 11/2021, point 4 of section 2: "The basis of the sanction will be the amount paid in cash in operations of an amount equal to or greater than 1,000 euros or 10,000 euros, or its equivalent in foreign currency, depending on the case of each one of the assumptions referred to in number 1 of section One, respectively ”.

 Law 11/2021, point 5 of section 2: "The sanction will consist of a proportional pecuniary fine of 25 percent of the base of the sanction provided for in the previous number, unless there is a case of reduction of the sanction referred to in the number 5 of section Three of this article ”.

 The offense is classified as serious and is considered administrative and exceeding the limits for cash transactions will be sanctioned with a fine of 25% on the amount paid in cash.

 COMPLAINT OF CASH PAYMENTS

 Law 7/2012, denunciation of cash payments, if one of the parties involved in a commercial operation, whose cash payment exceeds the limit of 1,000 euros, denounces the other party, it will be exempt from liability, provided that it performs the complaint within three months from the date of the payment made.

 • The complaint must specify the operation carried out, the amount and the identity of the other intervening party.

 • The complaint that the other intervening party may present later will be understood as not made.

 • The simultaneous presentation of a complaint by both parties will not exonerate any of them from responsibility.