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Selling Property Before Moving To Spain - Things To Consider

When you sell your property abroad before you take up residency in Spain, there are several things to think about.

If you´re not of pension age yet, and you don´t invest the total of the proceeds in another property, there might be Capital Gains to pay in Spain, even when you were exempt in the country the property was situated. More info here. To explain: the taxyear in Spain runs from January to December. You are considered a tax resident when you spend more than 183 days in a calendar/tax year here, so if you sold your property and moved here before the 1st of July, you are most likely to be considered a tax resident for that same calendar/tax year and thus obliged to file a resident´s RENTA income tax return the following year, April-June.

Or even if you moved here after July 1st, but spent a couple of weeks in the period January-June of the same year here as you need to add up any days spent here in calendar/taxyear. More info here. To add, whether you registered as resident or not, is not relevant. Timing your move to Spain can be of the essence to avoid having to pay Capital Gains.

If you don´t invest the total of the proceeds in another property, but keep them in a bank account, anywhere in the world, and use them to fund your life here until your pension starts coming in, for example,  then you need to know of the following obligation. Once a tax resident in Spain, you are supposed to report those ´overseas assets´ on Modelo 720, before March 31st. And any income generated from it,  yearly on your RENTA income tax declaration. More info here.

More info in case the above doesn´t apply to your situation, pensioners e.g.

FAQs Capital Gains

 

Please note: The information provided is based upon our understanding of current legislation. It is not legal advice but is provided freely to enable you to be properly informed. We recommend that if you are considering taking action, you should seek professional advice.

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