It goes without saying that the UK is fast approaching the end of the ‘Brexit’ transition period. With the 31st December 2020 looming on the horizon we want to know how the UK’s exit from the EU will affect individuals seeking to invest in property within the Europe.
Over the last year we have seen the property market in Spain increase by 77% by UK-citizens alone. If anything, the decision to leave the EU has pushed individuals into hurrying to invest overseas before the UK leaves the EU. But what’s the rush? Well, in the first phase of negotiations for ‘Brexit’ it was agreed with Brussels that whilst a withdrawal deal was being drawn, UK-citizens would retain their rights to live and their EU-citizen rights during the transition period. According to this, despite the UK no longer being an official EU member state Britons are free to settle in Europe and protect their EU-rights indefinitely so long as they apply for residency by the end of the transition period on 31st December 2020.
What happens after the transition period?
Even once the transition period has ended, relocating to Europe should remain relatively straightforward because most EU countries, such as Spain, heavily rely on expats to keep their economy afloat. Countries such as Spain, France and Portugal, are not expected to make the residency process difficult for UK-citizens. In the worst case scenario UK citizens will be handled the same way as other non-EU citizens, such as Australians, Americans and Asians, who have been settling and gaining residency in Europe successfully for many years.
What are likely to be our rights to invest in property in Spain post- ‘Brexit’?
There are currently no restrictions that property owners in Spain need to be an EU national – the costs remain the same, the right to purchase remains the same and the right to sell remains the same whether you are an EU or non-EU citizen. In fact, in Spain citizens of any nationality can obtain a mortgage provided they have the required credit score and register as a temporary or permanent resident. These requirements Europe tend to be standardized.
- EU Requirements to Live Overseas
Wherever you are in Europe individuals must register as residents at their local town hall. Typical requirements to register include a passport, evidence of income or employment (enough to support you and your dependents) and healthcare insurance.
- EU Rental or Business Property Tax
On the other hand, individuals looking to invest in property overseas as either a second home or holiday home should not need a visa after the transition period as long as they spend no more than 90 days in every 180 days in the country. If the property is a rental or business investment the laws for non-EU citizens are slightly different when it comes to tax - EU citizens are charged a 19% tax, whilst non-EU citizens are taxed 25%.
It is thought that once the UK leaves the EU the laws in Spain (or Europe) applied to UK-citizens will be the same as those for non-EU citizens – but these are yet to be confirmed. Nonetheless, the effect of ‘Brexit’ on overseas property owners is likely to be negligible.
For more information, get in contract. We are more than just an estate agency. We can have a team of consultants who can provide tax, immigration and relocation services. Call us on 02074875262 or email us on firstname.lastname@example.org