When changing tax residency from the UK to Spain, there are potentially costly mistakes that can be made due to not taking advice, or getting the wrong advice, as well as advantages that can be achieved with well advised planning.

Our legal, financial and tax professional associates assist our client with all the formal matters related to taking up residency in Spain, in particular Spanish tax planning.

Tax in Spain

Most are aware that the Spanish tax system is very different to that of the UK.  Income tax allowances vary depending age and whether you have dependents.  Tax rates for earned income are higher, and there are different rates for other types or income, such as that from investments or from letting residential property.

You have your non-lucrative visa, and you’re on your way to Spain to start your new life in Spain.  Congratulations!

You now start the process of getting yourself registered and set up in Spain.

Here’s our rundown of all the essentials that you’ll need to get done in your first few months of your non-lucrative residency.

Click / tap on the tabs to expand.

We usually arrange the set up of the digital certificate at the same time as the padron, as it requires and ID verification which can be done at the town hall.

With your TIE in hand you can move onto getting other things done which require proof that you are resident in Spain.

Healthcare

Private Medical Insurance – If you have private healthcare, check where the Dr’s and medical centres are in your area that are on your policy providers list, so that when you need attention, you know where to go and don’t go one which isn’t covered by you provider.

S1 NHS Certificate – If you have the S1, you can complete the application to register it with the social security as soon as you get your TIE.  The registration takes around 3 months, and one that is done you can enroll at your local healthcentre ‘centro de salud‘ and GP.

In either case, locating an English speaking medical centre or GP if there is one in your area, will be useful when you need medical attention.

Financial & Tax

Aside from getting banking and currency arrangements set up, there are a few things financial and tax that you need to do or be aware of.

Preparing for Your Non-Lucrative Residency Renewal

If you only just arrived in Spain with your non-lucrative visa, it mighty seem a bit premature to be thinking about the renewal, but it will come round quickly, and there are some key things to be aware of during your first year to help you get a speedy approval when you renew.  The main things that hold up renewal applications are:

Lack of Evidence of Living in Spain

Immigration expect to see a day to day living expenditure in Spain in you current account, preferably a Spanish bank account.  Use you bank card to pay for everything you spend in Spain in your first year.

Missing Border Control Stamps

Make sure that if you visit the UK or travel outside of the Schengen area and are stamped out, that you get stamped back in when you return.  Keep boarding passes in cases stamps are missed.

Taxes in Spain Not up to Date

The most common cause of an issue here is unpaid non-resident property tax where renewal applicants owned a property as a holiday home before getting their non-lucrative visa, and were not even aware that they should have been paying this tax.

Gap in Healthcare

This can happen when changing Private Medical Insurance provider or switching to state healthcare, e.g. via the S1.  It is important to make sure you do not have any gap in your healthcare cover.

This list is intended as a basic guide for the main things that most new non-lucrative residents need to do and think about in their first 6 months in Spain.  Of course everyone’s situation is different and along with everything here there will likely be many other things on your getting set up in Spain checklist.  The above is hopefully a good starting point for you.

The TIE, Tarjeta de Indentidad de Extranjero, is the Spanish identification card for citizens from third countries (non-EU) who reside in Spain.  The Withdrawal Agreement TIE is a special version of this card, issued to British UK nationals who have retained EU rights under the terms of the Brexit Withdrawal Agreement.

The qualifying requirements for applicants e.g. for proof of means remain the same as they were when the UK was in the EU.  British UK nationals living in Spain who had not obtained a residency certificate, had until the 31st December 2020 to apply for the the Withdrawal Agreement TIE.

You can now apply for the Withdrawal Agreement TIE in these circumstances:

There are two main healthcare requirements for the Non-Lucrative Visa.   Firstly you must be free from any of the diseases listed under the International Health Regulations 2005, and secondly you need to have unrestricted access to healthcare in Spain.

Doctors Letter or Medical Certificate for a Non-Lucrative Visa Application

The first requirement is satisfied by obtaining a Doctors letter or medical certificate.  The Doctors letter or medical certificate can be provided by your own GP, or a private Doctor either in the UK or Spain.  The letter or certificate has to be signed by the issuing doctor, have their medical practice stamp, and their registration number.  In the UK this is known as a GMC (General Medical Council) number.

The are quite a few steps and costs involved to import and register and car from a non-EU country in Spain.

First and foremost EU conformity, import and registration costs must be taken into account as these can make the import and registration in Spain impossible or too expensive to be worth while.

This said, under EU rules if you are moving from a non-EU country to live in an EU country, such as Spain, you can bring your possessions including cars, and avoid paying the costly duties and taxes and having to pay for expensive EU conformity certification.

These transfer of residence rules give you up to12 months form the date you get your residency to import your car and avoid paying customs and VAT.  However you only have 60 days from the date you take up residency, to register your car and avoid registration tax (if it applies).  

Spain’s Golden Visa offers residency to individuals who make a real estate investment in Spain of €500,000 or more.  The Golden Visa scheme has been in existence since September 2013 when legislation for the ‘residency by investment scheme’ was passed.  The aim being to attract foreign investors at a time when the economy of Spain was not in a very good place.  Since it’s inception, over 25,000 foreign investors have benefited from the scheme.

The scheme is open to nationals from non-EU or third countries, and has so far been most popular with investors from China, Russia and the USA.

What does Spain’s Golden Visa Offer Property Investors?

The TIE, Tarjeta de Identidad de Extranjero, or foreigners ID card, is the Spanish identification card foreign nationals from third countries (non-EU) who reside in Spain.

Once you have arrived in Spain with the relevant residency visa or otherwise meeting the eligibility for a residency permit that is applied for in Spain, you can begin the process to get your foreigners ID card – TIE ,’tarjeta de identidad de extranjero‘.

Applying for the TIE ‘Tarjeta de Identidad de Extranjero’ Foreigners ID Card

Before you can get your TIE you must have a valid residency visa or residency permission.  Residency visas are applied for and issued through the Spanish Consulate in your home country, and residency permits are handled by the immigration office in the province where you live in Spain.  How and where you apply depends on you situation and the type of residency you qualify for and are applying for.

Once your have your visa or residency permission granted by immigration, you apply for your TIE a National Police Station within the province where you live.  The card takes a few weeks to arrive and is collected from the police station when ready.

You can apply in person or appoint a representative or give someone Power of Attorney to apply for a residency permit on your behalf, however with the exception of the ‘Golden Visa’, residency visas have to be applied for in person.  The application for the TIE itself, also has to be made in person.  You provide your fingerprints and a photograph for your biometric ID card.  The whole process can take anything from 3 to 9 months depending on what type of residency you have applied for.

TIE – Spanish Visa & Residency Application Requirements General Info

Visa applications are applied for in person through the Spanish consulate.  Applications for residency permission can be done in person or can be submitted online.

The online submission system is works well, and the Spain’s immigration office encourages the use of this system.  To submit your application you need to have a digital certificate in place.  The digital certificate is and online ID and signature. If you don’t have one, you can authorise someone else or a company to complete the online submission on your behalf.

Official translations of documents that are not in Spanish must be provided.

Additional documents to support your application

The the consulate and immigration when reviewing applications apart from checking qualification and eligibility, may also request further information validating your arrival and situation in Spain.

When your application is received, a receipt will be issued confirming that it has been presented.  It will then be reviewed accordingly at the provincial foreigners office.  If for any reason your application is not immediately accepted and further information is requested, you have 10 working days to supply the additional information that has been asked for.  Applications are archived or rejected if additional information requested is not supplied in within the given time.

Notification of the approval of your application will usually be sent within 3 months, and you have one month to make an appointment and complete the your TIE application at the National Police Station.

You can read more about the different types of Spanish visas and residency here.

TIE Tarjeta de Indentidad de Extranjero Application – Getting Your Card

The second stage of the TIE application process is relatively straight forward, and appointments are readily available in most areas at the Foreigners Offices and National Police Stations.

For your second stage application you need to have a pre-booked appointment.

You can make an appointment through the following link:

https://sede.administracionespublicas.gob.es/pagina/index/directorio/icpplus

For your appointment you will need:

*EX application form (as with the first stage the form number varies depending on type of visa or residency you have)
*Your visa or residency permit approval notice
*Passport and a copy ( a copy of your passport and the application is acceptable if you are in the process of renewing it)
*Small (carnet size) passport  photo 32mmx28mm
*Proof of your Spanish address (padron)
*Modelo 790 form with €12 tax paid and stamped by the bank, or with payment receipt attached

When you present your application at the Police station your fingerprints will be taken electronically and if everything else is in order, you will be given confirmation of your processed application and told to make an appointment to come back and collect your card in 5 to 6 weeks.  Some Police stations operate collection without appointment, and just have allocated days or times for collection of TIE cards.

Link to all EX residency / TIE application forms: https://extranjeros.inclusion.gob.es/es/modelossolicitudes/mod_solicitudes2/

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Nationals of non-EU countries require a visa to enter Spain, if the stay is intended to be more than 90 days.  The Schengen visa in most cases cannot be used to apply for residency in Spain.

There is an exception when an immediate family member is joining a family member who already lives in Spain and holds Spanish residency.   In all other circumstances a citizen of a non-EU country must apply for, and obtain a long stay visa through the Spanish Embassy in their home country.

Since UK has now left the EU, UK citizens / British nationals also have to apply for a visa if they want to live or work in Spain.

Once the visa has been issued, the applicant can travel to Spain and apply for residency and get their TIE, ‘tarjeta de identidad de extranjero‘.

The following is a summary of the main types of long stay visas that citizens of non-EU countries can apply for.

ISA’s are very tax efficient ways to save or invest, as you pay no tax on savings interest, (not that you get any these days), and virtually no tax on investment returns. They are therefore usually the first type of saving or investment account that people will have.  For this reason, and the fact that there is a generous annual allowance to save into them, you like many other may have built up sizeable amounts in ISA’s.

You may also have reached, or be approaching retirement, and relying on this tax efficient ISA nest egg, to provide extra income to supplement your pension.  For some, an ISA may even be their ‘pension’.

ISA’s and moving to Spain

So if you’re moving, or have moved to Spain, can you keep your ISA?  The short answer is yes.  According to gov.uk:

If you open an Individual Savings Account (ISA) in the UK and then move abroad, you can’t put money into it after the tax year that you move (unless you’re a Crown employee working overseas or their spouse or civil partner).

You must tell your ISA provider as soon as you stop being a UK resident.

However, you can keep your ISA open and you’ll still get UK tax relief on money and investments held in it.

You can pay into your ISA again if you return and become a UK resident 

Great – you can keep your ISA, and continue to benefit from it’s tax efficiency!  Well not exactly.  When you move from the UK to Spain, you also move from the UK tax system to Spain’s tax system.  So you will continue to get UK tax relief, however your ISA will (or should), get Spanish tax treatment.