Question
We are retired Americans with Social Security and Teacher Pensions ($45k/yr). What percentage tax would we pay if we moved to Spain? We are also considering France due to the tax treaty.
Answers
These are the answers of Spainguru’s Facebook group members:
“Your teacher pension is not taxed but is used when determining the income taxation level of your Social Security. Also, your pension is only tax-free as long as you are not a Spanish citizen.”
“It depends on your joint incomes or individual circumstances, which is why tax professionals exist.”
“Spain has a tax treaty as well. Your teacher pensions are not taxed in Spain. Your income is taxed on a tiered basis. One thing is certain—you will pay a bit more in Spain, but the cost of living more than makes up for that. The superior healthcare, food, relaxed lifestyle, lower crime, and open-minded people all contribute to a better quality of life. You will likely be much happier in Spain than in the US. France is more expensive to live in than most parts of Spain, except for places like Barcelona and Basque Country, which are among the priciest.”
Taxes for Americans Living in Spain: A Quick Guide
“Taxes vary depending on the autonomous community. Assume no deductions or exemptions.”
“If you taught at a public school, the pension would most likely be considered exempt.”
“Just Google ‘Tax Rates Spain 2024’: Spain Tax Brackets Link.”
Conclusion
As retired Americans moving to Spain with Social Security and Teacher Pensions, your teacher pension would likely not be taxed, but it could impact the taxation level of your Social Security.
While your exact tax rate depends on your income and other circumstances, Spain’s tax treaty and the tiered tax system generally mean you may pay a bit more in taxes than in the US.
However, the higher cost of living in France and the superior quality of life in Spain—including healthcare, lifestyle, and safety—are factors that many retirees find compelling when choosing Spain over other countries.
