My own personal holiday home in Spain?

My own personal holiday home in Spain?

11:31 AM, 3rd August 2022, About 2 years ago 6

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Hi, I understand that it’s best to consult a specialist lawyer but I thought I’d ask in case others are in the same position.

I have properties in the U.K. in my personal name and am a higher-rate taxpayer. All the properties have mortgages secured against them.

I am about to complete on a holiday apartment in Spain which won’t be rented out. I have 3 grown up working daughters.

Is there anything I should do/am liable for tax-wise with this situation?

Also, would it be best to own it in my sole name or joint names with my daughters?

Many thanks


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Ian Dimarian

12:04 PM, 3rd August 2022, About 2 years ago

It may be beneficial to have the spanish home in your name & the children/ beneficiaries from the initial purchase, to save on legal fees & tax charges later.
Also in Spain, Blood Relatives who become beneficiaries are treated more leniently.
A Spanish will should also be prepared on purchase, confirming that your children who would be part owners from the date of purchase, inherit the Spanish property, thereby spreading any taxes.


12:23 PM, 3rd August 2022, About 2 years ago

Agree last comments about joint ownership with your daughters.
You are liable for spanish tax even though you will not let it out. It is worked out on the property value held by the regional council. You can complete the annual spanish tax return form on line but at this time you have to take the form into selected soanish banks to pay the amount due.
You also have toboay local taxes to the town hall but this you can do on line including payment.


12:47 PM, 3rd August 2022, About 2 years ago

Continuing on tax.
You do not need to have a Soanish bank account from which you pay your taxes, I don't. However, you may want one for paying durrct debits for water, electric and other services.

Churchills Tax Advisers

14:44 PM, 3rd August 2022, About 2 years ago

You really need to get specialist advice. On the face of it, it looks as if you will be paying too much tax on your existing BTLs and are also likely to have a substantial IHT liability on death, depending on the amounts involved. Spanish property needs to be included in your estate for UK IHT purposes and may also be liable for Spanish estate taxes.

You will need to have a new UK will/codicil if you buy a Spanish property and should also have a Spanish will as well.

Personally, I find owning property abroad a headache, I prefer to use the funds to rent AirBnBs, etc. Then all the admin and repair headaches are sorted out by others!


16:12 PM, 3rd August 2022, About 2 years ago

Don't be put off buying in Spain. Seems like you are close anyway. Yes there are IHT issues down stream but don't let that stop you having a good life. IHT is for your daughters to worry about not you. Its great having your own place in Spain especially as you can let your daughters use it if they like at anytime of the year as well as you. No need to book anything, just get s cheap flight and your there. It won't affect your annual income tax in the UK at all and the tax you pay in Spain is not excessive. As you get older you will find yourself spending more and more time out there, particularly in winter. Three months off, three months back. You will find you will double up on everything. Clothes, bikes, gardening equipment, tools etc allowing you to travel light each time you go. Believe me it's a great life especially in winter.


16:48 PM, 3rd August 2022, About 2 years ago

BTW the annual income-tax on a property you don't let in Spain is 1.1% of 24% of cadastral (Property value as recorded by the Spanish land Registry). If you are an EU resident it would be 1.1% of 19%. We (UK passport holders) are now treated as 3rd county so its 24%. So if your holiday home Cadastral is valued at £200,000 euros the annual tax would be €528, About £10 per week.

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