O n 1st January 2021 the transition period negotiated between the UK and the EU came to an end.

With the Brexit agreement, new rules will apply to travelling, carrying out business or residing in Spain.

The agreement signed between the United Kingdom and the European Union on 24 December 2020 put an end to the undesired scenario of a no-deal Brexit with terrible consequences to both parties.

Following the conclusion of the withdrawal agreement, the UK is from 1st of January 2021, no longer a member estate of the EU and UK citizens will change their status to non-community to the eyes of the Spanish institutions.

The consequences of this are enormous and affect in many aspects such as residence, work, investment, leisure, import/export, services, etc.

In this very short article, we will be focusing on travelling, residence, business and taxes for the British in Spain and how it will develop as from 2021.

Brexit in Spain: What are the consequences?

Travelling to Spain

As from 1st of January 2021 British citizens travelling to Spain will have to fulfil the requirements set out in article 6 of the Schengen Borders Code, amongst of which are:

    • Justify the purpose and conditions of the intended stay, and have sufficient means of subsistence for the stay and the return;
    • Spend no more than 90 days in Spain in any 180-day period.

British citizens are exempt from obtaining a visa to enter Spain.

The above does not apply to those who hold a residency card in Spain.

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Residence in Spain after Brexit

Consequences of Brexit for UK people living in Spain

British citizens and their family members willing to reside in Spain from 2021 will be subjected to the general immigration regime and will have to apply for visas to either reside, live or work in Spain.

This status might change in the future in case that the UK and Spain would sign any bilateral agreement, but until then, Britons willing to move to Spain would have to apply for a working permit, non-lucrative or any other valid permit.

Investment schemes such as the golden visa will now be applicable to UK nationals buying a property in Spain. Find more information about the golden visa on our website.

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Carrying out business in Spain

British citizens carrying out business in Spain will be subjected to different rule due to their new condition of non-EU citizens. Working in Spain either for a Spanish company or as a freelancer will be subjected to the obtention of a visa or a special permit.

Registering a company, acquiring a business or buying a property are still available options. The advice of an expert lawyer and tax advisor will now be more important than ever.

Several corporate-related EU directives such as the parent-subsidiary directive (PSD), will no longer be applicable.

UK companies carrying out businesses in Spain on the other hand will face new regulations applying to goods and people movement, data protection, tax system, employment relocation, licenses, etc.

Opening a branch or registering a subsidiary company in Spain could now more than ever be an excellent solution to find a way around to the extra burden caused by Brexit to UK companies trading in the EU.

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Taxes in Spain after Brexit

Spain and the UK have a double taxation agreement that remains in place after Brexit. This treaty avoids having to pay taxes in both countries for the same concept.

Whereas nothing has changed much in terms of personal taxation one must pay close attention to tax residency matters bearing that when residing in Spain will be subjected to income tax there.

Other tax formalities such as the overseas declaration of assets (modelo 720) and the wealth tax are things to keep in mind as huge fines derive from misfiling.

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At Legaliaspain we are legal and tax advisors, do not hesitate to contact us and get in touch with one of our English speaking lawyers for further information on how Brexit can affect any of your interests in Spain.