DEL Canto Chambers is opening a new office in Palma, Mallorca, as the London-based barrister chambers expands its work across the UK and Spain in response to increasing demand for advice on the opportunities available in the Balearic Islands.
Covid-19-related restrictions encouraged many to re-think their lifestyle choices and as such, UK entrepreneurs are increasingly looking to move their business operations and residency to sunnier climates. Recognising that many businesses can operate from anywhere in the world, Spain has become one of the most popular choices, with the Balearic Islands coming up trumps.
Not only is Spain considered a gateway to other European markets, but it also has many legislative and tax-related incentives where foreign investments are concerned, and UK business owners are picking up on these.
Since the Brexit vote, interest from British investors into Spain has grown significantly, with the UK becoming the main foreign investor in Spain in 2019. Investment by British companies increased by almost 80% in the first half of 2019 compared to the same time in 2018, to €3.125bn.
While many entrepreneurs are considering relocating their UK-based business to Spain, there are also many investors looking to buy a small or medium sized enterprise in Mallorca or one of the other Balearic Islands. The types of business vary greatly, from service-based businesses to boat chartering and horse riding, with Spaniards selling these to UK citizens.
The type of activity you wish to embark upon goes together with the need to gain residency. There are three available visa options to consider. Golden Visas incur mostly a €500,000 expenditure out of tax and expenses and will reward you with citizenship for investing into the country, other Golden Visa options related to significant deposit and Spanish company investments’ are options to be considered too; The Non-Lucrative visa relies on the person’s own financial resources to ‘sufficiently’ maintain him/herself and family members – this is a good option if you are not planning to undertake professional activities in Spain, so is ideal for retired people that want to spend most of their time in Spain. Finally, the Entrepreneur visa requires a specific cost to start up a business in Spain considering innovation and benefits that the business will bring to Spain as other requirements.
It is also important that expats consider their tax options when relocating to Spain, especially prior to buying a property in the Balearic Islands and seek professional advice from international lawyers with a good understanding of the two jurisdictions (the UK and Spain). This requires a variety of taxes payable, which consist generally of personal income tax on property or any income rental; capital gains tax; city council tax; and tax on assets such as boats.
A financial understanding of what a move to Spain entails for UK citizens is paramount. Specialist advice should be sought so that your residency status and global wealth can be properly considered and used to your advantage. For British citizens and foreign expats planning on moving or operating their business from Spain, there are many options available.
Julio Prieto is an international barrister specialised in Tax and Private Clients, based in London and Palma de Mallorca. Del Canto Chambers is an international tax legal Firm based in London with a country focus on Spain, which is opening a new office in Palma, Mallorca in October 2021. Del Canto Chambers has been advising numerous UK individuals and families on their tax and immigration status post Brexit. More details of the Firm can be found here https://delcantochambers.com/