On the 31st of January 2020 the UK will leave the European Union. Until the end of 2020 the UK wants to negotiate a Free Trade Agreement with the EU – a very short time frame. However, the petition for another prolongation of the transition period, which must be submitted to the EU before 30.06.2020, was already rejected by Boris Johnson during the elections. Thus, it is still completely open, whether UK’s leaving the EU via hard Brexit or not.
During the transition period until the end of 2020, the rights and the status of UK citizens living in Spain will not change. They can work, collect their pensions, visit other EU countries, buy or sell products within the EU, etc. Green residence cards or A4 residence document, will remain temporarily valid until the end 2020, (unless they are expired).
In case of the UK leaving the EU with an agreement there may be changes, however, it is the aim of both sides, to protect EU citizens in the UK as well as UK citizens in the EU.
However, the Spanish authorities are always pointing out that all concessions made are only valid, as long as the UK makes the same arrangements for Spanish citizens living in the UK.
British expats should apply for a long-term residence permit as soon as possible, because without such a permit they will have difficulties to travel.
With or without a withdrawal agreement, all UK citizens who are working permanently in Spain and who are registered with the Spanish Social Security will have access to healthcare. Also, their family members, provided they are resident in Spain and are living in Spain (spouse or partner and children up to 26 years old when they live with the worker and are dependent on him/ her).
For cross-border workers, the procedure for the issuance of a work authorization will be regulated, as also the status of Spanish citizens working in Gibraltar that needs to be regulated by a reciprocal agreement.
Driving licences issued in the UK will be recognized in Spain during a period of nine months. Within this time, UK citizens can change them for a Spanish one. After this period, they will be treated as driving under a licence from a third country. The Spanish licence can be used for short visits in the UK. If a UK citizen returns to live in the UK, he can exchange it for a UK driving licence without passing a test.
The UK and Spain have already signed an agreement to protect voting rights for their citizens living in the other country from Brexit consequences. This agreement makes sure that UK citizens living in Spain and Spaniards living in the UK will be able to vote in the municipal elections and can also be candidates. UK citizens in Spain must have been residents for at least three years and be registered in the “padron municipal” and in the Electoral Census.
British citizens resident in Spain will not be able to vote in elections to the European Parliament after Brexit, as the UK will no longer form part of the EU.
Taxes as residents and Non-Resident Tax:
After Brexit, UK citizens who are not resident in Spain, who own property here will suffer an increase in the Non-Resident Tax. The percentage of this tax will change from the reduced percentage of 19 % for EU-citizens to 24 % for citizens of third countries.
Taxes as residents: The double taxation agreement between the UK and Spain will not change after Brexit. As a Spanish resident, you need to declare your global income to the Spanish authorities, no matter from which country it comes. Certain incomes are taxed in the UK (such civil servant wages or pensions). As a resident you may need to file an annual declaration of overseas assets (form 720).
The inheritance tax in Spain is a regional tax to be paid to the respective Autonomous Community (i.e. Andalusia) and is subject to regional regulations. In Andalusia, for example, the minimum exempt of succession tax is 1,000,000 € for direct relatives. After Brexit, UK residents will not be able to take advantage from these benefits. They will be subject to the Spanish state tax system, its regulations and allowances.