British expats & Brexit

brexit-british expats

What’s coming next for British expats in Spain?

As the “hard Brexit” ghost gets closer and closer, questions arise between the British expats’ community.

In general, the main issues concern their personal status as foreigners once the transition term comes to an end. But the answer is not simple, as each individual or family has a different start point in terms of income origin, school-age children, family ties, etc.

brexit-british expats

Main rule after January 1st, 2021.

UK expats or citizens without a Residence Permit (“Permiso de residencia”) will be reputed as foreigners for all purposes.

As you’ll probably know, Spain acknowledges a Residence Permit to all UK citizens that before July 6th 2020 were incorporated to the spanish UE-Residents Register. That comes automatically without need of any proceedings (although it’s dearly advised to obtain a TIE ID Card by means of an EX23 form).

For those living in Spain but who didn’t incorporated in time themselves to the UE-Residents Register, they had the chance to solve it before the end of 2020 through an exceptional proceeding (EX20 & EX21 forms).

What does imply being a foreigner?

Foreigners have two kind of legal status in Spain (and Europe) depending on the way they arrive. Basically the Law recognizes the right to stay and the right of residence.

Right to Stay

British citizens arriving in Spain will have the right to spend 90 days in the country every six months.

UK belongs to the list of countries whose citizens are allowed to arrive without a visa. So they only need to check passports at arrival. The date stamped in their passports is the starting point. In all cases take care that if you arrive through another European country’s passport control, Spain will take that date as inbound date, no matter if you arrive here sixty days later (Europe’s single frontier to all effects).

Schengen visa delivered by Spanish Embassies and Consulates will not provide the right to work.

If you do not leave Spain before the 90 days term, you’ll get into a “illegal” situation and given the case that Police detects you, you might be fined, receive an ejection order and even blacklisted for the future.

Although that’s not actual policy, Spain keeps an eye on what’s going on at the UK. Reciprocity will be the key word in the future.

Residence

Brexit will mean that UK citizens that didn’t get the Residence Permit before 01/01/2021 will lose their European status (Royal Decree 240/2004) and they will be applied the general foreign status (Royal Decree 557/2011) in order to obtain a Residence Permit.

The first difference between both status is where are demands applied. European citizens apply directly to Spain. Foreigners must address the Spanish Embassy or Consulate at UK.

What type of residence?

Depending on your personal situation you’ll have to apply a different form and produce a different set of documents. We shall try to explain the main options, but to be honest that’s not a simple matter.

All types of residence permits are initially set for a year. Then they must be renewed for a two years permit. After two renewals (5 years) you get a long-term permit, also known as “permanent”.

Of course, all these proceedings include your family in some way or other.

A) Residence in Spain without job or business.

Let’s make clear that for this matter, being employed by a UK company that doesn’t declare your wages to Spanish social security and Tax Office doesn’t count. Same that owning a non-Spanish based company.

If you decide to settle in Spain spending more than 183 days a year, you’ll have to show a yearly income of 25.816 € (and 6.454 € additional euros for each family member).

Also, you’ll have to take out health insurance, prepaid for a whole year and grant school for your children.

That kind of residence permit doesn’t allow to work or run business in Spain. That would require a new process that can be started in Spain at a later stage.

B) Working in Spain.

For that type of residence permit that also allows working in Spain, the process must be started by the spanish company that wants to hire your services.

That will require a previous inquiry at Employment Services in order to get a certificate stating that they weren’t able to provide any person fulfilling the company’s requirements. Not easy, not fast.

Anyway we must appoint the fact that special proceedings exist for hiring directors or key staff of local branches of foreign company’s investing in Spain.

C) Running a business

When your option is starting a business in Spain you’ll have to produce a Business Plan and show enough financial strength in Spain to fulfil it.

Your business plan must be validated by one of the five organizations agreed by the government.

The best way to start it is creating a spanish LLC (Sociedad Limitada) and transferring the capital required by your business plan.

Health insurance will be required too.

D) Other options

The spanish systems includes many other possibilities, like “Investor’s visa” granted to people investing more than one million euros value assets; or half a million euros in real state assets; or staff members of company’s that start high investments.

Final considerations

The first question that arises, and you must decide upon it, that is whether you’re staying part-time in Spain or you want to live, work, run a business or spend your retirement in Spain.

When you just spend some weeks a year here, even if you own a house or apartment, your current status will allow you to travel for a period of ninety days each six months (so barely half a year) at Europe. You’re subject to work restrictions and if you own a bank account, it will be reputed as non-resident.

If you and your family are moving to Spain for any reason, then the Brexit makes a difference, and you’ll have to plan your next steps. Delaguia-Luzon Abogados y Asesores (formerly Evalue Asesores) legal department is also dedicated to this kind of affaires for non-European customers.

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