Change to UK Tax Law. – Comaskey Properties

I had a sit down with Sam Henderson over the weekend. Sam is a British accountant who is quite convinced that the change in the UK tax system is potentially big news for clients looking to buy property in Spain.

So the change to the system means this:

Any UK residents, over the age of 55 can right now take from their pension pot withdrawals of 25% tax free.
The balance of the withdrawals will be subject to tax at the individuals on going tax rate. For Annuities in the UK the new rules are the same however this only comes into law on the 5th of April 2016.

What this means to us selling property in Spain is that now, British residents get a quite incredible exchange rate and they potentially have access to a large pot of cash to spend on the Orihuela Costa.

We hope they will invest this cash by buying property here in La Zenia!! Seriously though if people are looking to invest this money then La Zenia is as good a place as any. Accessible, climate, low cost of living, family friendly, and thanks to the strong pound; fantastic value in Spanish property.

Sam asked me to say that this lump sum will be considered part of your yearly income and if you withdraw the money you may move to a higher tax rate. For example if you are in the lowest brand but take a lump sum that increases you income in the year to 42,000 GBP your rate will increase.

As an accountant, naturally he also advised that people taking out this lump sum need to be careful with their financial planning, invest wisely and make sure that you know when your state pension kicks in. For some people this can be over 60, for others 65 and higher, so plan accordingly.

We look forward to helping you find your dream home in Spain, and the perfect investment.

Ian Comaskey

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