Capital Gains on UK Property

I will be becoming a Spanish Tax resident this year and I understand that I pay taxes in Spain on my worldwide assets. I have not yet sold what is currently my main residence in the UK and I am not sure how I stand once I move to Spain and live permanently in my Spanish property when I eventually come to sell my UK house. Can anyone help?

Thanks
Chris

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I am in a similar position. We move out to Spain permanently in May but in the current housing market we're struggling to sell our house without giving it away, fortunately, it won't prevent our move. I am considering renting it out for a while to give the market time to recover a little and sell in 2009. I have been advised that providing I sell within 3 years of it not being our principle residence, I won't incur capital gains. Obviously I will get this confirmed when I know exactly what we are doing, but the info did come from a tax accountant friend.

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I heard something similar but I assumed that was from an Inland Revenue perspective rather than the Spanish Tax system. It worries me that from a Spanish point of view, especially as the UK property has to be declared for Wealth Tax (I think), that there will be a requirement to pay CGT under the Spanish hacienda when it is eventually sold. I hope I'm wrong....

Chris

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Extract from: http://www.blacktower.co.uk/pdf/Moving%20Overseas%20v2.pdf

Would the 5 years apply to you? It's probably best to take some good tax advice to ensure you get the best tax position.

Capital Gains Tax

Even if you are non-resident for income tax purposes you may still remain liable to UK Capital Gains Tax (CGT) on gains arising after you attain

non-resident status. Your need to be aware that anyone who leaves the UK will generally remain liable to CGT for the first five years they spend outside

the UK. After five years disposal of assets bought prior to departure from the UK are free of UK CGT. However, it is important to note that many countries

have their own CGT regime which may be applicable when you acquire and disposes of assets outside the UK.

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No wonder people hide their life savings under their beds. Makes perfect sense now.

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** EDITED - Please respect terms of posting **

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