SPAIN

As an expat residing in Spain, you will be subject to Spanish income tax on your worldwide income. The Spanish income tax rates vary depending on your income level. Our experts can help you calculate your income tax liability, claim deductions and exemptions, and ensure compliance with Spanish tax laws.

Succession tax in Spain, often referred to as “inheritance tax,” can be a significant concern for expats with assets in Spain. The rules for succession tax vary between regions in Spain, making it essential to have expert guidance. Our network can help you navigate these regional differences and plan your estate to minimize tax liabilities for your beneficiaries whether these are based in Spain or in the UK.

If you sell property or other assets in Spain or elsewhere, you may be liable for capital gains tax. The rates and exemptions for capital gains tax in Spain can be complex. Our experts can guide you through the process, ensuring that you understand your tax obligations and take advantage of any available deductions.

Wealth tax in Spain is a multifaceted aspect of the country’s fiscal landscape that requires a nuanced understanding, as it can vary both by region and under nationwide regulations.

Regional Differences:

Spain’s autonomous communities have the authority to determine their own wealth tax rates and exemptions, which means that the wealth tax you pay can significantly differ depending on where you reside or hold assets. Some regions have more favourable wealth tax rules, while others impose higher rates. Our experts can provide you with up-to-date information on the wealth tax regulations specific to your region, helping you navigate these regional variations effectively.

Nationwide Rules:

Recent developments in Spanish taxation have brought about the introduction of a new national wealth tax, often referred to as the “temporary solidarity tax on large fortunes.” The primary aim of this tax is to standardize and harmonize the rules governing wealth tax across Spain’s autonomous communities. It is important to note that this tax is applicable for the tax years 2022 and 2023.

Tax Rates Based on Net Wealth:

The new wealth tax targets individuals with a net wealth exceeding €3 million. The tax rates are structured progressively as follows:

• €3 million to €5 million: 1.7%
• €5 million to €10 million: 2.1%
• Over €10 million: 3.5%

This progressive rate structure means that those with higher levels of wealth will face a higher tax liability.

Planning for retirement in Spain requires careful consideration of your pension options, including state pensions private pensions and the use of annuities. It’s also vital to stay informed about evolving tax regulations and their potential impact on your pension income. Seeking advice from experts who are well-versed in Spanish pension and tax laws can help you make informed decisions and optimize your pension strategy for a secure and enjoyable retirement in Spain.

Recent updates to Spanish tax regulations have significant implications for non-EU pension transfers, notably affecting British expatriates. These changes mean that non-EU pension transfers to Spain are now subject to taxation, which can lead to additional tax obligations for non-EU expats. To gain a comprehensive understanding of the impact of these changes on your financial situation, it is strongly advisable to consult with professional experts from the Advice for Expats network who specialize in Spanish taxation and pension matters.