Retirement - Spain or Portugal?

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Json
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Retirement - Spain or Portugal?

Post by Json » Sat Jul 20, 2019 8:54 pm

Next year I will be doing an early retirement from the Fed gvmt (MRA+10).

I am looking to retire to either Spain or Portugal. My preference is Spain as I could potentially gain citizenship in about 2 years (Nationality by residence - Two years for nationals of Ibero-American countries). http://www.exteriores.gob.es/Portal/en/ ... lidad.aspx
I plan to use the Residence Visa for Retirees. http://www.exteriores.gob.es/Consulados ... irees.aspx

However, the Spanish wealth tax* could be a deciding factor. I will be retiring with about $1M in TSP, $1M in stocks, and about $500K in other assets.

I plan to go back to grad school to take courses or do another degree. I have about $25K in a 529 but so far it seems like the University of Navarra is the only one where I could use the funds in Spain. Going to their main campus will subject me to the wealth tax. Residents of Madrid are 'exempt' from the tax (up to 2M) but no universities there take the 529 funds.

The other option is Portugal. There's quite a bit of information online about the Golden Visa. However, this path requires buying property worth at least €500K or investing over €1M. I do not want to buy a property as I don't plan to just stay in one area within the country. One advantage of Portugal is the non-habitual resident (NHR) tax regime which allows individuals the opportunity to become tax residents of a “white-listed” jurisdiction and still legally eliminate their taxes on most foreign-source income.

So, the challenges are the wealth tax in Spain or the investment requirements in Portugal. I would be very interested in hearing about other options or alternatives that I might not be aware for those 2 countries. And if I'm making too much of a big deal of the impact of the wealth tax.

* Depending on the region the wealth tax could be over an additional $12k a year

fiscallyinterested
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Re: Retirement - Spain or Portugal?

Post by fiscallyinterested » Sat Jul 20, 2019 9:57 pm

Sounds like you've done your research, so I don't have too many great ideas to offer.

A few things that come to mind:
  • The NHR in Portugal will also cause your capital gains on stock sales to be taxed at 28%
  • Consider Roth accounts carefully: the consensus on this forum is that Spain would consider your distributions of earnings (though probably not principle) as taxable income, even though the US does not. I'd bet you're aware, but Spain taxes worldwide income even if you're not a Spanish citizen (though I'm not familiar with the residence visa for retirees – so wouldn't be surprised to find that there were exceptions for certain types of income).
  • Would you have access to healthcare in Spain as part of your residency? If so, $12k per year doesn't seem bad if that's you're entire tax bill (and you're presumably getting a cheap education out of it as well, if you're paying even close to what the Spanish pay for education)
Just curious: which state is your 529 plan in? I'm just starting to learn the 529 ins and outs, and wasn't aware yet of such a restriction as yours (where you can use the funds as tuition).

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cinghiale
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Re: Retirement - Spain or Portugal?

Post by cinghiale » Sun Jul 21, 2019 12:06 pm

Any consideration of living in Spain fewer than 183 days each year? You could then live where you want (Madrid is big and expensive, with hot summers and cold winters... think Indianapolis) and be unbothered by having to file either Spanish income or wealth taxes.

Our current strategy, now four years along, is as follows: We fill out IRS Form 8802, “Application for United States Residency Certification” each year. The IRS provides this residency certification on Form 6166, a letter of U.S. residency certification. That demonstrates that we are fiscal residents of the US. Also, we keep all key communications (taxes, credit cards, etc.) tied to a US address and visit the US each year for around 1-1.5 months. During the US visit we get our US taxes filed and take care of any necessary medical, dental, or administrative appointments. There’s also a pile of mail to open.

And then, we are fulfilling a long time dream of seeing the rest of Europe with the remaining time that gets us to 183 days.

Now, that plan may not have that much appeal, but please consider the following. Per your own calculations, the wealth tax would likely nick you for 12K. That amount of money can underwrite a whole lot of cheap airfares (Vueling, EasyJet, Ryanair, etc) and a whole passel of lodging options (Air B&B, Booking.com, etc.). Again, YMMV, but with early retirement, sufficient resources, and good health, you might want to put this option on the table.
"We don't see things as they are; we see them as we are." Anais Nin | | "Sometimes the first duty of intelligent men is the restatement of the obvious." George Orwell

martiansteeler
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Re: Retirement - Spain or Portugal?

Post by martiansteeler » Sun Jul 21, 2019 12:18 pm

cinghiale wrote:
Sun Jul 21, 2019 12:06 pm
Any consideration of living in Spain fewer than 183 days each year? You could then live where you want (Madrid is big and expensive, with hot summers and cold winters... think Indianapolis) and be unbothered by having to file either Spanish income or wealth taxes.
I don’t think the comparison of Madrid to Indy is fair. Firstly, Madrid is a dry heat. Secondly...wine is a heck of a lot cheaper. Thirdly, it doesn’t snow. I won’t go on.

OP- FYI, as of the middle of last year, there is an additional option for Golden Visa investment in Portugal. “Transfer capital of at least €350,000, destined to acquire units in investment or venture capital funds aimed at providing capital to companies that meet certain requirements.” Not getting into the details, but there is at least one fund that is qualified by SEF https://www.golden-visa-portugal.info/. I am exploring this option at the moment (as I don’t feel like owning property halfway around the world). The other benefit to the Golden Visa is that you can start the process now, as there is minimal residency involved.

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Watty
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Re: Retirement - Spain or Portugal?

Post by Watty » Sun Jul 21, 2019 12:24 pm

Which language do you speak best, Portuguese, Spanish or Catalan?

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cinghiale
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Re: Retirement - Spain or Portugal?

Post by cinghiale » Sun Jul 21, 2019 12:44 pm

martiansteeler wrote:
I don’t think the comparison of Madrid to Indy is fair. Firstly, Madrid is a dry heat. Secondly...wine is a heck of a lot cheaper. Thirdly, it doesn’t snow. I won’t go on.
OK... I shot from the hip on the Indianapolis comparison. But Madrid does get snow every now and then, and I stand by the hot summers/cold winters claim. And, to the point, that there so many locations in Spain with much better year-round weather. I love visiting Madrid, a short 2-hour AVE ride away. But it is expensive, it’s not easy to socially integrate there, and the weather is less-that-optimal.

The cheaper price (and splendid quality) of Spanish wine is a given.

Better?
"We don't see things as they are; we see them as we are." Anais Nin | | "Sometimes the first duty of intelligent men is the restatement of the obvious." George Orwell

martiansteeler
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Re: Retirement - Spain or Portugal?

Post by martiansteeler » Sun Jul 21, 2019 1:57 pm

cinghiale wrote:
Sun Jul 21, 2019 12:44 pm
martiansteeler wrote:
I don’t think the comparison of Madrid to Indy is fair. Firstly, Madrid is a dry heat. Secondly...wine is a heck of a lot cheaper. Thirdly, it doesn’t snow. I won’t go on.
OK... I shot from the hip on the Indianapolis comparison. But Madrid does get snow every now and then, and I stand by the hot summers/cold winters claim. And, to the point, that there so many locations in Spain with much better year-round weather. I love visiting Madrid, a short 2-hour AVE ride away. But it is expensive, it’s not easy to socially integrate there, and the weather is less-that-optimal.

The cheaper price (and splendid quality) of Spanish wine is a given.

Better?
Better. I, unfortunately, have to spend a lot of time in Indy...it is no Madrid (or any other world class city).

And I do agree there are better places in Spain, weather, food and cultural-wise

Topic Author
Json
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Re: Retirement - Spain or Portugal?

Post by Json » Sun Jul 21, 2019 2:59 pm

Thanks everyone for taking the time to share your thoughts. I'm certainly learning more about options based on your feedback.

Here are some answers to the points raised.
The NHR in Portugal will also cause your capital gains on stock sales to be taxed at 28%
Yes, good point. I don't plan to use most of the stock portfolio in the first 5 years or so. At the moment is in mostly VTSAX and Munis.
Consider Roth accounts carefully
I'll be quite careful about this and only do the conversion when it makes sense.
Would you have access to healthcare in Spain as part of your residency?
No. At least for the first 2 years I will be on private insurance. Most likely GeoBlue, Sanitas, Bupa Global, or something along those line. Some Universities in Spain also have private plans that look interesting.
Just curious: which state is your 529 plan in?
VA. But I plan to go back to TX before moving overseas. When I do I will then transfer the 529 to Schwab. I'm not planning to come back to VA so I'm not too worried about tax recapture.
Any consideration of living in Spain fewer than 183 days each year?
One of the big pluses for me on this option is in been able to gain citizenship in 2 years so I will need to be there full time. Obviously with the occasional short break back to the states. Thanks for the idea of filling out IRS Form 8802, it's a good idea if the plans don't pan out.
OP- FYI, as of the middle of last year, there is an additional option for Golden Visa investment in Portugal. “Transfer capital of at least €350,000
I was not aware of this option, thanks! I will certainly take a look as it sounds like a very good alternative.
Which language do you speak best, Portuguese, Spanish or Catalan?
Spanish - fluent; Portuguese - read/write mid-level, need more practice with the spoken word; Catalan - entry level. Also, have a basic level of Galician.
Madrid does get snow every now and then
I much prefer the cold weather than the heat. Not below-zero cold though.
Indy...it is no Madrid (or any other world class city).
I would prefer to go north in Spain, particularly a city like Santiago or Leon. But Madrid is the only place where I could 'escape' the wealth tax (at least at the moment).

halfnine
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Re: Retirement - Spain or Portugal?

Post by halfnine » Sun Jul 21, 2019 4:46 pm

I thought you would have to renounce your other citizenship if opting for Spanish citizenship. However, in the you learn something everyday category, I just learned I was wrong. Me, though, I would have to renounce my citizenships if I took that path. Well, you win some, you lose some. Best of luck whatever your decision.

UpperNwGuy
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Re: Retirement - Spain or Portugal?

Post by UpperNwGuy » Sun Jul 21, 2019 7:30 pm

I think Leon would be an excellent mid-point between the heat of Madrid and the rainy climate of Asturias and Galicia. Another city to consider would be Burgos, but it's a bit colder than Leon. Both cities have excellent cuisine and great historic features.

coffeeblack
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Re: Retirement - Spain or Portugal?

Post by coffeeblack » Sun Jul 21, 2019 7:34 pm

Json wrote:
Sat Jul 20, 2019 8:54 pm
Next year I will be doing an early retirement from the Fed gvmt (MRA+10).

I am looking to retire to either Spain or Portugal. My preference is Spain as I could potentially gain citizenship in about 2 years (Nationality by residence - Two years for nationals of Ibero-American countries). http://www.exteriores.gob.es/Portal/en/ ... lidad.aspx
I plan to use the Residence Visa for Retirees. http://www.exteriores.gob.es/Consulados ... irees.aspx

However, the Spanish wealth tax* could be a deciding factor. I will be retiring with about $1M in TSP, $1M in stocks, and about $500K in other assets.

I plan to go back to grad school to take courses or do another degree. I have about $25K in a 529 but so far it seems like the University of Navarra is the only one where I could use the funds in Spain. Going to their main campus will subject me to the wealth tax. Residents of Madrid are 'exempt' from the tax (up to 2M) but no universities there take the 529 funds.

The other option is Portugal. There's quite a bit of information online about the Golden Visa. However, this path requires buying property worth at least €500K or investing over €1M. I do not want to buy a property as I don't plan to just stay in one area within the country. One advantage of Portugal is the non-habitual resident (NHR) tax regime which allows individuals the opportunity to become tax residents of a “white-listed” jurisdiction and still legally eliminate their taxes on most foreign-source income.

So, the challenges are the wealth tax in Spain or the investment requirements in Portugal. I would be very interested in hearing about other options or alternatives that I might not be aware for those 2 countries. And if I'm making too much of a big deal of the impact of the wealth tax.

* Depending on the region the wealth tax could be over an additional $12k a year
Have you thought about Malta as your base and then live in Spain or Portugal part of the year?

money_bunny
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Re: Retirement - Spain or Portugal?

Post by money_bunny » Sun Jul 21, 2019 8:08 pm

¿Ustedes hablan espanol?

Which reminds me how I should start studying again as well. :)

rj342
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Re: Retirement - Spain or Portugal?

Post by rj342 » Sun Jul 21, 2019 9:28 pm

This idea always makes think of 2 questions
1. Children or grandchildren? Seems like a way to remove them from your life , see them maybe once a year?
2. What is exit strategy for if/when its assisted living, memory care, nursing home time?

AlohaJoe
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Re: Retirement - Spain or Portugal?

Post by AlohaJoe » Sun Jul 21, 2019 9:37 pm

cinghiale wrote:
Sun Jul 21, 2019 12:06 pm
Our current strategy, now four years along, is as follows: We fill out IRS Form 8802, “Application for United States Residency Certification” each year. The IRS provides this residency certification on Form 6166, a letter of U.S. residency certification. That demonstrates that we are fiscal residents of the US.
I don't know why you'd bother with the 6166. It doesn't prove anything when it comes to filing taxes; it only helps after you've already filed taxes in a foreign country. The only thing that matters is your passport with the dates of entry & exit to the country. In my many years living outside the US I've never seen a foreign tax office care about anything but your passport when it comes to determining domicile.

wineandplaya
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Re: Retirement - Spain or Portugal?

Post by wineandplaya » Sun Jul 21, 2019 10:24 pm

Have you considered Andorra? Beautiful scenery with great skiing in the winter and great hiking in the summer. 3 h by car to Barcelona. Lots of nice places to visit both on the French side and the Spanish side. Much lower taxes than either Spain or Portugal. Language won't be problem if you speak Spanish (Catalan is official).

fiscallyinterested
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Re: Retirement - Spain or Portugal?

Post by fiscallyinterested » Sun Jul 21, 2019 10:38 pm

Why is it that you are interested in the Spanish passport? What would it give you that a US passport + EU residency doesn't?

drk
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Re: Retirement - Spain or Portugal?

Post by drk » Sun Jul 21, 2019 11:49 pm

cinghiale wrote:
Sun Jul 21, 2019 12:44 pm
But Madrid does get snow every now and then, and I stand by the hot summers/cold winters claim. And, to the point, that there so many locations in Spain with much better year-round weather.
Not to beat a dead horse, but you're looking for Seattle. Madrid is a little bit warmer and quite a bit sunnier, but the weather is very similar, and this list certainly applies to both:
cinghiale wrote:
Sun Jul 21, 2019 12:44 pm
But it is expensive, it’s not easy to socially integrate there, and the weather is less-that-optimal.

DJN
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Re: Retirement - Spain or Portugal?

Post by DJN » Sun Jul 21, 2019 11:59 pm

Hi,
there is whole section on Wiki on Non Habitual Residency, it doesn't have any emphasis on US citizens. have a look here: https://www.bogleheads.org/wiki/EU_non- ... _residence
Malta is a good option and they don't tax your capital gains made outside the country.
good luck,
DJN
Yah shure

8track
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Re: Retirement - Spain or Portugal?

Post by 8track » Mon Jul 22, 2019 7:52 am

rj342 wrote:
Sun Jul 21, 2019 9:28 pm
2. What is exit strategy for if/when its assisted living, memory care, nursing home time?
I would also like to know more about how elder care is done in these two countries. In Italy for example elders are generally cared for by their children with the help of hired “badanti”. There are few if any assisted living options for those without family to look out for them.

rj342
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Re: Retirement - Spain or Portugal?

Post by rj342 » Mon Jul 22, 2019 9:40 am

8track wrote:
Mon Jul 22, 2019 7:52 am
rj342 wrote:
Sun Jul 21, 2019 9:28 pm
2. What is exit strategy for if/when its assisted living, memory care, nursing home time?
I would also like to know more about how elder care is done in these two countries. In Italy for example elders are generally cared for by their children with the help of hired “badanti”. There are few if any assisted living options for those without family to look out for them.
I could see problems if something came up quickly, decided to move back to US for that stage, and possible state residency requirements for Medicaid -- or if you have been gone for years and not been paying into Medicare?
Maybe the options in the new country are decent, but I would be very careful -- 'free' national healthcare for a broken arm or appendix is different than nursing home LTC for an outsider.

fiscallyinterested
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Re: Retirement - Spain or Portugal?

Post by fiscallyinterested » Mon Jul 22, 2019 10:28 am

or if you have been gone for years and not been paying into Medicare?.
Sounds like OP has been paying into Social Security and Medicare long enough (Medicare) to qualify for Medicare, without having to pay more into the system.

I don't understand Medicaid enough to be able to comment, though.

Regarding Social Security, it's worth pointing out, OP, in case you're not aware: https://www.ssa.gov/international/Agree ... spain.html

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Watty
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Re: Retirement - Spain or Portugal?

Post by Watty » Mon Jul 22, 2019 11:01 am

Json wrote:
Sun Jul 21, 2019 2:59 pm
Spanish - fluent; Portuguese - read/write mid-level, need more practice with the spoken word; Catalan - entry level. Also, have a basic level of Galician.
Living in Spain would be a big advantage.

I was never good at languages and eventually gave up when I realized that if I worked really hard I might be able to do OK with the pronunciation and grammar but I would never be able be adequate in the idioms and slang. It would be more challenging for you to pick that up in one of the languages other than Spanish.

Topic Author
Json
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Re: Retirement - Spain or Portugal?

Post by Json » Mon Jul 22, 2019 2:37 pm

I thought you would have to renounce your other citizenship if opting for Spanish citizenship.
Nope, as you found out US citizens retain their citizenship and basically become dual citizens
Another city to consider would be Burgos
Definitely a great city and very well located geographically.
Have you thought about Malta as your base and then live in Spain or Portugal part of the year?
Yes, but at the moment I have a preference for Spain and Portugal. Also, Malta might be viewed as more of a tax heaven which could potentially raise tax issues at some point later on.
¿Ustedes hablan espanol?
Si, also Italian at a basic level. An advantage of learning a romance language is that others are easier to pick up.
Children or grandchildren? Seems like a way to remove them from your life , see them maybe once a year?
No children, but plan to make trips back to the states to visit family about twice a year (while remaining under the limit on the num of days in the US)
What is exit strategy for if/when its assisted living, memory care, nursing home time?
At the moment mid-50's so not that big of an issue right now. But if something were to happen that assisted living will be needed then I will most likely move back.
foreign tax office care about anything but your passport when it comes to determining domicile.
Yes, which is why I will be extra cautious with keeping track of the days.
Have you considered Andorra?
Andorra would be a great option. However a somewhat issue is that they don't have an international airport. That means you would need to have the right visa when landing in Spain or France.
Why is it that you are interested in the Spanish passport?
An EU passport makes it a lot easier to travel and live in other EU countries for extended periods. At the moment Spain/Portugal are on the top of the list but after a few years it would be good to consider Italy, Germany, or the Netherlands (I worked for a short period in those countries in the past)
this list certainly applies to both: But it is expensive, it’s not easy to socially integrate there, and the weather is less-that-optimal.
Yes that's why I would have preferred to go to a northern city in Spain. The lower cost of living on those cities get offset by the higher taxes (wealth, etc.)
there is whole section on Wiki on Non Habitual Residency, it doesn't have any emphasis on US citizens. have a look here: https://www.bogleheads.org/wiki/EU_non- ... _residence
Thanks! checking it out to see what else to take into account.
In Italy for example elders are generally cared for by their children with the help of hired “badanti”
Assisted living is certainly a consideration. Without getting into a rabbit-hole discussion overall health/assisted-living expenses in the US are out of wack. Most likely it would potentially better quality care and less expensive in other countries.
I could see problems if something came up quickly, decided to move back to US for that stage, and possible state residency requirements for Medicaid -- or if you have been gone for years and not been paying into Medicare?
I have over 35 years of SS and Medicare contributions.
Regarding Social Security, it's worth pointing out, OP, in case you're not aware: https://www.ssa.gov/international/Agree ... spain.html
I wasn't aware of this, good to know. Thanks!
I was never good at languages and eventually gave up
Don't give up. Immersion could make a big difference, just give it time. You will be surprised how quickly you can pick a base understanding particularly if you don't need to earn a living in the foreign country.

wineandplaya
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Re: Retirement - Spain or Portugal?

Post by wineandplaya » Mon Jul 22, 2019 4:30 pm

Json wrote:
Mon Jul 22, 2019 2:37 pm
Have you considered Andorra?
Andorra would be a great option. However a somewhat issue is that they don't have an international airport. That means you would need to have the right visa when landing in Spain or France.
Barcelona would be the closest big international airport, with good direct flights to the US. I don't think you should worry about visas too much. With a US passport, you shouldn't need a visa to begin with. If you for some reason do need a visa, they will probably give you a multiple entry Schengen visa, valid for maybe 10 years.

halfnine
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Re: Retirement - Spain or Portugal?

Post by halfnine » Tue Jul 23, 2019 3:15 pm

Json wrote:
Mon Jul 22, 2019 2:37 pm
I thought you would have to renounce your other citizenship if opting for Spanish citizenship.
Nope, as you found out US citizens retain their citizenship and basically become dual citizens
Actually what I found out is that there are some exemptions that allow individuals to obtain Spanish citizenship without having to renounce their other citizenship(s) with the Spanish authorities. For a US Citizen who applies based on a 10 year residency period they would have to state that they intend to renounce their US citizenship with the Spanish authorities and possibly take an oath to this extent. Of course, an oath to Spain won't in itself actually renounce one's US citizenship. That would require renouncing it with the US embassy. To each his own, but I find this quite a slippery slope.

Topic Author
Json
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Re: Retirement - Spain or Portugal?

Post by Json » Sun Jul 28, 2019 2:38 pm

A follow question: does anyone knows if I will need to pay the 'foreign student' rate at the universities during the first couple of years if I am on the Residence Visa for Retirees?

Curious1
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Re: Retirement - Spain or Portugal?

Post by Curious1 » Wed Aug 07, 2019 12:07 pm

cinghiale wrote:
Sun Jul 21, 2019 12:06 pm
Any consideration of living in Spain fewer than 183 days each year? You could then live where you want (Madrid is big and expensive, with hot summers and cold winters... think Indianapolis) and be unbothered by having to file either Spanish income or wealth taxes.

Our current strategy, now four years along, is as follows: We fill out IRS Form 8802, “Application for United States Residency Certification” each year. The IRS provides this residency certification on Form 6166, a letter of U.S. residency certification. That demonstrates that we are fiscal residents of the US. Also, we keep all key communications (taxes, credit cards, etc.) tied to a US address and visit the US each year for around 1-1.5 months. During the US visit we get our US taxes filed and take care of any necessary medical, dental, or administrative appointments. There’s also a pile of mail to open.

And then, we are fulfilling a long time dream of seeing the rest of Europe with the remaining time that gets us to 183 days.

Now, that plan may not have that much appeal, but please consider the following. Per your own calculations, the wealth tax would likely nick you for 12K. That amount of money can underwrite a whole lot of cheap airfares (Vueling, EasyJet, Ryanair, etc) and a whole passel of lodging options (Air B&B, Booking.com, etc.). Again, YMMV, but with early retirement, sufficient resources, and good health, you might want to put this option on the table.
I have some questions regarding your plan. As you can only stay in a Schenngen country for 90 days w/o a long stay visa, and you only plan to return to the US for 30-45 days, where will you spend the remaining time? I know that there are other non- Schenngen European countries that you could go to to use up the remaining days. Is this what you plan to do?

wineandplaya
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Re: Retirement - Spain or Portugal?

Post by wineandplaya » Fri Aug 09, 2019 11:10 am

Curious1 wrote:
Wed Aug 07, 2019 12:07 pm
cinghiale wrote:
Sun Jul 21, 2019 12:06 pm
Any consideration of living in Spain fewer than 183 days each year?
I have some questions regarding your plan. As you can only stay in a Schenngen country for 90 days w/o a long stay visa, and you only plan to return to the US for 30-45 days, where will you spend the remaining time? I know that there are other non- Schenngen European countries that you could go to to use up the remaining days. Is this what you plan to do?
I don't think spending fewer than 183 days automatically means that Spain won't consider you a resident for tax purposes. If you spend more time in Spain than in any other country, I'd think that they want to tax your worldwide income.

You can read about Shakira case:
https://www.forbes.com/sites/kellyphill ... x-evasion/

Edit: Here is a better explanation: https://www.blevinsfranks.com/news/arti ... -and-taxes
Last edited by wineandplaya on Fri Aug 09, 2019 5:34 pm, edited 1 time in total.

WhiteMaxima
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Re: Retirement - Spain or Portugal?

Post by WhiteMaxima » Fri Aug 09, 2019 11:55 am

If you live less than 6 months per year, you will not be taxed in Spain and Portugal. You are US citizen, you are going to be taxed no matter where you live. So the best options is have a base in the US and move to Spain/Portugal for 6 months (long term visa still needed). The best is to find another US couple to rent a house there and share 6 month each, hopefully US 6 moth share also). In that sense, both family will enjoy the retirement overseas and still connect to the US base (you would still need to come to have dental and physical take care using medicare). You could change destination each year (one year in France, another in Greece or Thailand). Good luck.

wineandplaya
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Re: Retirement - Spain or Portugal?

Post by wineandplaya » Fri Aug 09, 2019 5:32 pm

WhiteMaxima wrote:
Fri Aug 09, 2019 11:55 am
If you live less than 6 months per year, you will not be taxed in Spain and Portugal.
This is incorrect. Spending less than 6 months is a necessary but not sufficient condition for not being taxed.

WhiteMaxima
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Re: Retirement - Spain or Portugal?

Post by WhiteMaxima » Fri Aug 09, 2019 5:39 pm

wineandplaya wrote:
Fri Aug 09, 2019 5:32 pm
WhiteMaxima wrote:
Fri Aug 09, 2019 11:55 am
If you live less than 6 months per year, you will not be taxed in Spain and Portugal.
This is incorrect. Spending less than 6 months is a necessary but not sufficient condition for not being taxed.
I google it:
Anyone residing in Portugal for 183 days or more during a single calendar year must pay taxes in Portugal on worldwide and local income. Non-residents – those who reside in Portugal fewer than 183 days per year – are not required to pay tax on worldwide income.
Even if you become a permanent resident, you can still file a tax waiver from income oversea. Any income from Portugal is subjected to tax no matter resident status.

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aspirit
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Location: SMA.SFL

Re: Retirement - Spain or Portugal?

Post by aspirit » Fri Aug 09, 2019 5:50 pm

I recall numerous white collar financial criminals preferred waiting out there 7yr statute of limitations in Portugal in the 80s, same populace, different tax terms. imho.
Good Luck!
Time & tides wait for no one. A man has to know his limitations. | "Give me control of a nation's money and I care not who makes it's laws" | — Mayer Amschel Bauer Rothschild ~

wineandplaya
Posts: 35
Joined: Fri Sep 14, 2018 9:42 am

Re: Retirement - Spain or Portugal?

Post by wineandplaya » Fri Aug 09, 2019 5:55 pm

WhiteMaxima wrote:
Fri Aug 09, 2019 5:39 pm
wineandplaya wrote:
Fri Aug 09, 2019 5:32 pm
WhiteMaxima wrote:
Fri Aug 09, 2019 11:55 am
If you live less than 6 months per year, you will not be taxed in Spain and Portugal.
This is incorrect. Spending less than 6 months is a necessary but not sufficient condition for not being taxed.
I google it:
Anyone residing in Portugal for 183 days or more during a single calendar year must pay taxes in Portugal on worldwide and local income. Non-residents – those who reside in Portugal fewer than 183 days per year – are not required to pay tax on worldwide income.
Even if you become a permanent resident, you can still file a tax waiver from income oversea. Any income from Portugal is subjected to tax no matter resident status.
It's possible to be considered a resident while spending less than 183 days in a country. It's explained well, in the case of UK & Spain here:

https://www.blevinsfranks.com/news/arti ... -and-taxes

I know that for Sweden, tax authorities apply a "72 day rule". For Portugal it might be different, I don't know, but for Spain you can certainly be a resident while spending less than 183 days.

If you fulfill the tax residency criteria of both Spain and the US, you need to turn to the US-Spain double taxation treaty:
Where by reason of the provisions of paragraph 1, an individual is a resident of both
Contracting States, then his status shall be determined as follows:
a) he shall be deemed to be a resident of the State in which he has a permanent home
available to him; if he has a permanent home available to him in both States, he shall be
deemed to be a resident of the State with which his personal and economic relations are
closer (center of vital interests);
b) if the State in which he has his center of vital interests cannot be determined, or if he
does not have a permanent home available to him in either State, he shall be deemed to be
a resident of the State in which he has an habitual abode;
c) if he has an habitual abode in both States or in neither of them, he shall be deemed to
be a resident of the State of which he is a national;
d) if he is a national of both States or of neither of them, the competent authorities of the
Contracting States shall settle the question by mutual agreement.

student
Posts: 3500
Joined: Fri Apr 03, 2015 6:58 am

Re: Retirement - Spain or Portugal?

Post by student » Fri Aug 09, 2019 6:01 pm

You may want to take a look at https://www.youtube.com/user/nomadcapitalist

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