Information exchange: a ‘game changer’

While there may not have been a huge turn out to the recent Adeje Focus meeting with speakers from Blevins Franks and DeCotta Law, those in attendance were glad they came as the information garnered on tax matters, information exchange between jurisdictions and inheritance tax is of huge importance.
Paul Montague talked about the alarming number of people who don’t believe they need to pay tax here despite the fact they spend much more than half of the calendar year living in Tenerife, use the ‘residencia’ discounts, are registered with and use the local medical services, own a home and car, and perhaps only stay with a family member for a few weeks back in the UK. They are and will legally be deemed to be ‘de facto’ tax residents, he explained, and it is really important that people realise this and get their financial matters in order.
“You do not have a choice where you pay your taxes”. He said it was vital to make a tax declaration “now more than ever”. He also quoted Spanish government sources who have stated that, those British residents “who have legitimised themselves” in Spain will have few if any problems post-Brexit. In other words, get your paperwork, resident and tax status in order, now.
Wayne Sheridan looked at the issue of the automatic exchange of financial information on individuals between the Spanish and UK government, which has been in operation since September 2016, “it really was a game changer”. He quoted the experience of clients who have received letters from the Central Bank in London as they have picked up on the fact that they have a Spanish phone number or car registration, so they should be declaring assets in Spain. The bottom line, he says, is that “if you have a financial asset that you have not declared in Spain, in another country, rest assured Hacienda (the Spanish tax office) will find out about it in due course”.
The third speaker was Jon Sutton from DeCotta Law, who addressed the issues of wills and inheritances taxes. He spoke of changes in the laws regarding both, and urged non-Spanish residents with assets here (from a car to a home or business) to make a will. Having a will here will make life easier for your beneficiaries and help them avoid inheritance tax fines.
The company also remind people to make sure that if they have a UK will or are about to make one make sure it does not have the wording “I hereby revoke all former Wills and Testamentary dispositions heretofore made by my and declare this to be my last Will”, as this would revoke any Spanish will you have.