Taxes

If you are retiring here, then I assume that means you will live here?  When you take Residencia - or if after 31/12/20, TIE, you are a resident of this country and will be obliged to pay your taxes here.

Hi,

Thanks for the reply, are we still paying tax then in the UK, as I understand Spain & the UK have a dual tax treaty, so you only pay tax once. This is my understand?

Regards Cath & Ray

That is correct, you will not be taxed twice; however seek assistance from an asesora when you get here, because the Spanish tax system is ... complex and you are obliged to make a declaration on overseas assets

if you have a home in both countries you must be a resident for tax purposes in the one you spend 183 days of more in a year in and you'll need residencia in Spain.  You will pay tax on all your income including what would be tax free in the UK like any premium bond winnings or isa interest and all interest on any savings accounts.  every year you at the moment must declare any assets worth more than 50 thousand euros house, savings, life insurances etc.  you do not pay tax on these at the moment but you never know?  you will not pay tax on any Civil service pension, forces pension but you have to declare it as income.   You pay tax on state pension as well.  Tax is calculated differently here so you need the assistance of a good person used to dealing with the process.

Tax year in Spain is 1 jan to 31 Dec and obviously it doesn't match with UKs 6 April to 5 april.  Also if you get any rental income from your UK property that is income to be declared.