Transfer money from UK to Spain

British and Spanish citizens are free to relocate to the other country, whether for work or retirement, and do not need a resident or a work permit. If you are moving to Spain, you should obtain a foreign identity number, Número de Identidad de Extranjero (NIE), and a residency card, Tarjeta de Residencia (TR), within three months of arriving. This has been slimlined by membership with the EU but, as previously mentioned, could be under threat with the current Brexit negotiations.

The number of Spanish domestic properties bought by British nationals rose in 2012 by 3.5% to 4,148, though this is still far from the peak of more than 17,000 in 2007. The strengthening of the pound since 2013 and continued weakness in the Spanish property market may see interest continue to grow. After Brexit, the value of the pound falling combined with uncertainty regarding residency has led to British investment in Spanish property falling away.

It is difficult to get a mortgage in the UK against a foreign property, so any mortgage will likely come from a Spanish lender. There are specialist brokers in the UK that focus on overseas property purchases. Whether borrowing or buying outright, it is essential to budget for buying costs, such as a mortgage and lawyers’ fees, taxes and insurance – around 10% of the purchase price is generally advised for Spain. Securing such expert property, legal and tax advice is absolutely essential before making any overseas money transfer. The British government has a dedicated website offering advice on buying property in Spain.

Spain has become one of the most popular retirement destinations for expats from the UK, with some 57,000 retirees settling there (out of 808,000 British expats in total) as of 2012, according to the UK’s Department of Work and Pensions and the Institute of Public Policy Research. Some estimates put the number of British expats at around one million. If you live in but have never worked in Spain, you must contact the International Pension Centre in the UK in order to claim your UK state pension.

The UK state pension can be paid to a Spanish bank account, but it may be better value to receive the money into a UK account and send money to Spain. Given that the British government is not obliged to raise pensions in line with inflation, using a broker may be the best way to make sure that you receive as much as possible. If you become a non-UK resident, you will not pay UK tax on your state pension but may still pay tax in Spain.

With Britain and Spain having a double taxation agreement, people do not pay tax on the same income in both countries. In accordance with Spanish and international law, all residents in Spain, both nationals and non-nationals, are obligated to declare assets held outside Spain. Assets may include bank accounts, securities, rights, insurance, annuities, property, etc. The Spanish government requires all residents to file an annual declaration of overseas assets by 31 March each year. This agreement has been come to via the EU. This may not still be in place if the UK finally leaves the EU.