As specialists in Spanish succession law we are frequently asked by clients “Do I really need to make a Spanish will?” as it seems that there are a lot of mixed messages about this issue on the Internet. The answer, as with so many legal questions is; “It depends,” but there are a number of compelling reasons why it can benefit you to have a Spanish will in place if you own assets in Spain.
In England & Wales it is impossible for buildings and land to be registered in the name of a minor (someone under 18 years of age according to English law). Instead, property is held in trust for the minor, whereby the legal owner of the property is an adult who holds the beneficial interest in the property for the minor. There may be more than one trustee and more than one beneficial owner. The duties of a trustee in those circumstances are established clearly by law in England & Wales.
Please note that there is more up-to-date information in relation to Brexit. You may find our video on the effect of Brexit for UK nationals throughout the transition period and beyond helpful. We also have a more recent article on living, working and owning property in Spain.
In 2016, immediately following the referendum of 23 June, we considered the possible effects of Brexit on British property owners in Spain, Brits intending to move to Spain, and those thinking about buying property in Spain after Brexit.
We intended, as the negotiations progressed, to write regular updates as the terms for the United Kingdom leaving the European Union were agreed. Since 23 June 2016 we have been watching and waiting. It has been extremely difficult to put anything in writing when the position has remained undefined. We are now in April 2019 and it seems that the Brexit position is no clearer.
While it is an unfortunate certainty that we will all be subject to tax if we own property in Spain, what is uncertain are the different types of taxation and the level of that taxation, depending upon whether the person liable to the tax is resident in the EU, the European Economic Area, or neither. While most people who buy property in Spain are nationals of EU member states, including Brits for the time being, it is also useful to focus on the extent to which those who are not resident in the EU are treated differently from a taxation perspective, as that is the most likely position of UK nationals in the not too distant future.
The process, costs and pitfalls of buying a place in Spain have been well documented. However, what follows the purchase receives less attention, despite being equally important. Being a property owner in Spain attracts the same risks and responsibilities as owning property in any other jurisdiction, but there are some quirks that are unique to Spain. Here we guide you through the steps you ought to take and matters you should be aware of when you become a property owner in Spain.
If you own property in Spain and you do not live in Spain you may not be aware that you are liable to pay Spanish non-resident income tax. This is not unusual. Many people own property in Spain for several years without being aware that they must pay non resident income tax.
It can come as no surprise to those familiar with real estate in Spain to know that a number of rural properties throughout the country, particularly in Andalusia, were built without planning permission. The issue of how best to deal with these properties has plagued the Spanish authorities as well as causing anxiety for buyers and sellers of Spanish property for many years.
Please note that while the process remains the same, there have been some changes in relation to the cost of a Spanish mortgage. For further information, please see our article highlighting this change here.
While it is certainly fortunate to be able to purchase a primary or secondary residence with funds that you already have in your bank account, many people who are able to do so opt to finance the purchase in part by borrowing from a lending institution, often a bank, secured against the property that they are purchasing. Applying for a mortgage in the UK is relatively straightforward. Many of us have done so at least once, if not multiple times. Apart from being advised by your solicitor as to the potential effect of a mortgage, that is about all that you need to know.
In Spain the system is slightly more involved and considerably more costly.
It is only natural that first time buyers of property in Spain are uncertain of the route to completion of the transaction. Spanish laws and business practices are often a long way from what one would expect in the UK, although when analysed carefully it becomes clear that with a few notable exceptions the actors involved in a Spanish property transaction are not entirely dissimilar from those one would expect to encounter in one’s home country. Here we provide you with a brief guide to who’s who in your Spanish property purchase.
Home is where the heart is, and what better way to create a home in Spain than by buying property in Spain with friends and family and sharing the property from the outset? For this reason, it is not uncommon for a number of family members or a group of friends to buy property in Spain together. For most people this is an arrangement that works well for all involved, but there are risks involved and for that reason, it is important to consider the options before you proceed.
E&G Solicitors in Spain dealt with our property purchase extremely professionally and efficiently. At no time did I worry that I couldn't get the answers to my many questions. We are very happy, everything was clear and straightforward and in plain English.
