What are the tax implications for UK property rental income when applying for a Non Lucrative Spain visa?
Question
I am interested in anybody who has experience of getting an Non lucrative Spain visa and kept their home in U.K. and rented it out, my concern is the taxes that would be taken as part of the world wide modelo form value of that home in U.K. and the rental income from that property would thus be the scenario?
Answers
These are the answers of some Facebook group members:
”You have to have a pretty high net worth to be over the threshold for the wealth tax. That’s relevant to the value of the asset. Check what the threshold is for the autonomos region you want to settle in and crunch some numbers. The rental income is not included in the wealth tax return (because it’s income), but it is included in your annual Spanish tax return. Any increase in cash savings (from any/all sources) is used to calculate asset values for any wealth tax review”
”I’m far from an expert but you might want to ask about the Capital Gains Tax implications should you decide to sell the house at a later date”
”In the same process myself but decided against it went instead for self employed visa”
”Just remember on an NLV someone else will have to act on your behalf in all aspects of the rental because you can’t do any work”
Conclusion
So in conclusion, According to Spainguru Facebook group members, When living in Spain with a Non lucrative Spain visa (NLV), the UK property value could be subject to Spain’s wealth tax if your net worth is above the regional threshold.
Rental income from the UK must be declared on your Spanish tax return but isn’t included in the wealth tax. Be mindful of potential Capital Gains Tax if you sell the property. Additionally, under a Non lucrative Spain visa, you cannot work in Spain, so you would need a representative to manage the rental.
