Spain is one of the favorite countries to visit for UK citizens. Its warm weather and high quality of life attracts over 18 million of UK visitors per year and holds over 300000 permanent UK citizens as residents. But recently, many UK citizens in the southern country have encountered a new problem that may alter their way of life: Brexit. With the UK leaving the European Union, UK citizens would no longer hold the title of European citizens, and this could affect their way of living in Spain, especially if we take into account their assets in the country.

How having the Spanish residency may affect you

While the UK was part of the European Union, Spanish taxes were way more relaxed on their citizens. But now that the UK has decided to finally leave, UK citizens have to pay the same taxes in Spain than any non-european citizen would, meaning that the amount of these would have dramatically increase. A good example of this can be seen in the inheritance taxes. A non-resident UK citizen would pay a 19% tax rate for their properties in Spain. However, after Brexit we can see that these numbers have go up to 24%.  This means that before Brexit, your beloved ones would pay very little (if any) to get their share of your will, while now they would need to pay a lot to the Spanish government to get what is rightfully theirs. A good way to bypass this problem would be by applying for a Spanish residency permit and creating your will as a Spanish resident. 

The Spanish residency certificate is mandatory for those that live in the country for more than 3 months. It gives you the same rights and obligations than a Spanish citizen. Having a Spanish residency certificate comes with many perks, such as allowing you to work in the country, receiving free healthcare, free education for your children, etc. And of course, lower taxes than a non-citizen. 

The Spanish residency certificate lasts for 5 years, and in order to acquire it, you would need to provide the corresponding authorities with the following information:

  • You would need to provide the government with bank statements or paperwork mentioning your economic activities that prove you would be able to provide for yourself and your family (if you are applying along with them) for the next three months.
  • You need to have a private health insurance that covers a minimum list of healthcare processes. 
  • Your working contracts, either if you work for a company or are self-employed.
  • An official translation of important documents like your marriage certificate, which needs to be done by a sworn translator in order to hold legal grounds.

Overall, it is a very simple process, but if you have any doubt about it, we recommend you ask for the legal assistance of a lawyer in order to avoid any possible inconvenience that could come along the way.

The inheritance taxes

As stated before, Brexit could affect severely the amount of taxes you pay for inheritances in Spain if you do not have the Spanish residency certificate.  But, how does the inheritance tax Spain law works? Inheritance taxes in Spain depends of the autonomous community where you reside, being some significantly higher than others. These taxes need to be paid to the autonomous community where the deceased one has lived during the 5 years prior to his death. This taxes are often a burden for the heirs, who often face the problem of not being able to afford paying them. That is why after Brexit, it has become so important to apply for a Spanish residency certificate before doing our will, since this would help us lower that burden on our loved ones. 

After we pass, our heirs would have a timeframe of 6 months to provide the required documents to claim their new properties.