Andalucía has become one the top 3 regions in Spain with the least taxes. On the 21st September 2021, the regional president, Juanma Moreno, announced the scrapping of Wealth Tax in Andalucía.
The tax has accounted for just 0.6% of income for the regional government (€95m annually), and Moreno believes the change will have a very positive impact on increasing revenue by attracting investment.
A large number of the highest wealth tax payers left Andalucía in 2020, resulting in a loss of income of estimated at around €18m (€3.5 million euros in wealth tax and €14 million in personal income tax).
The president is hoping that removing Wealth Tax will encourage people with high income who spend long periods in Andalucía, but are not tax resident, to make it the region their permanent home and pay tax there.
We first published this article in February last year. At that time Brexit had finally just ‘been done’, and the transition period begun. Through 2019 and 2020 unprecedented numbers of British nationals formally registered as resident in Spain to secure their residency rights under the Withdrawal Agreement. The numbers of residency applications spiked in the last months of 2020. Immigration reported receiving many thousands of last minute applications in December alone.
This year we’ve been receiving a lot of queries this year relating to Spanish residency and tax in Spain. For many it seems, the main priority was getting residency with the consideration of tax, put to one side on in some cases completely overlooked.
So we’ve refreshed and republished this article, and it will hopefully provide answers to most general questions that you may have about tax in Spain, if you’ve recently taken up residency in Spain.