How to Retire in Spain

Spain has long been a retirement destination for Europeans, like Arizona and Florida for Americans. History, architecture, literature, art and music are part of daily life in Spain. The Iberian Peninsula is blessed with coastlines on the Atlantic and Mediterranean, multiple mountain ranges, rivers and extensive nature reserves. Here are nine tips to help you make the most of retirement living in Spain.

Why Retire in Spain

Spain provides numerous options for retirement living. There are big expat retiree communities along the Mediterranean coast and smaller ones inland. You could settle in one of the country’s interesting cities, from Barcelona to Valencia to Seville. If you prefer a cooler climate, look at the country’s north coast.

One spot in particular to consider is the Costa Tropical, one of the least-known, quietest and most authentically Spanish of the Mediterranean coasts. The Costa Tropical’s position between the brilliant blue Mediterranean and the soaring Sierra Nevada Mountains creates a subtropical climate where living things flourish. Attracting visitors for its climate, beaches and scuba diving, it also makes a great base for exploring inland Andalusia, the white villages of the Alpujarras, Granada’s mesmerizing Alhambra Palace and the Sierra Nevada National Park.

[See: The Best Places to Retire Overseas in 2020.]

You’ll Need to Speak Spanish

Outside the British tourist haunts of the south, you won’t encounter many English speakers across Spain. School-aged and university students may speak some English and be keen to practice with you, but you’ll need at least a working knowledge of Spanish to communicate with everyone else.

Apply For Residency Before You Arrive in Spain

You can come to Spain for 90 days as a tourist. If you would like to stay longer, you can extend this for another 90 days at the local foreigner’s office or police station. Do this at least three weeks before your initial three-month stay ends.

For a longer-term stay, you must apply for a long-term residency card. The application process for this must begin in the United States. Before traveling to Spain, you must receive a stamp in your passport from a Spanish consulate. To qualify, you will be required to show a minimum of 25,000 euros in a bank account in the country.

The Benefits of Spain’s Golden Visa Program

Golden Visa programs are offered by many countries and amount to an opportunity for obtaining residency by making a property purchase in the country. Spain’s program dates to 2013 and requires a property purchase of at least 500,000 euros.

Spain imposes no in-country stay requirement for Golden Visa residents. However, you must renew your residency after the first year and then every two years until you apply for permanent residency. After you have received permanent residency, you can sell the property you purchased to qualify for Golden Visa status.

[See: The 10 Best Places to Retire in Europe.]

Buying Property in Spain

Non-residents may be able to get a bank mortgage for the purchase of property in Spain. The process is straightforward, and it’s possible to request pre-approval from a bank before you’ve found the property you want to buy. You might want to opt for a mortgage broker to help you find the best deal. You can engage one for as little as a 500-euro fixed fee. Do your research to make sure you don’t end up paying hidden fees to the bank.

Taxes in Spain

Spain is famous for its bureaucracy, which can be particularly frustrating when it comes to understanding your tax obligations. Spain’s tax system is complex, subject to change and differs from one autonomous region to another.

The general rule is that you’re considered a tax resident if you spend more than 183 days in Spain during the calendar year. You may also qualify as a tax resident if your main professional activity is based in Spain or if your spouse or dependent children are living in Spain.

Income tax is progressive, and the rates for national and local income tax are usually between 19% and 48%. The sales tax is a 21% tax on consumer goods that is usually included in the price indicated on price stickers.

Spain also has a wealth tax that is imposed annually and based on the total net worth of your worldwide assets and income. The rate is .2% to 2.5%, depending on the region where you’re living. Each tax resident is allowed assets of 700,000 euros and a personal residence worth 300,000 euros. However, no wealth tax is imposed by the Madrid autonomous region.

Consider Retirement in the Basque Region

The Basque Region is made up of seven provinces that sit astride the French-Spanish Atlantic border. Four of the provinces of Basque country are in Spain: Alava, Viscaya, Guipuzcoa and Navarra. There are also three provinces in France: Labourd, Bas Navarre and Soule. The region has its own language, music, dance, sport, cuisine, myths, flag and even alphabet typeface.

Respect the Siesta

The Spanish have one big meal each day, usually in the middle of the day around 2 or 3 p.m. It’s an affair of abundance, including three courses, dessert and wine. After lunch, it’s time for a nap. The perfect siesta is 20 minutes long on the floor, so you aren’t tempted to sleep longer. Note that shops close for two to three hours each day to accommodate the siesta lifestyle. No business is conducted during this window.

[See: 10 Retirement Hot Spots in the U.S.]

The Running of the Bulls

Sleep is not part of the program during Pamplona’s annual Festival of San Fermin, an around-the-clock carnival of music, fireworks, marching bands, clapping, stomping and stampeding bulls. Ernest Hemingway immortalized this annual saint’s day turned trade festival in his novel “The Sun Also Rises.”

Each new festival day officially begins when 12 bulls are set free from corrals to run through the center of the old town along the cobblestoned Mercaderes Street. The bulls are joined by hundreds of thrill-seekers who sprint alongside and sometimes end up underfoot or even with a horn in a side. Each morning’s excitement takes place at precisely 8 a.m. By 8:03 that day’s mad dash is history. The bulls are in the ring, where they will remain until that evening’s fights.

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