UPDATED 20th February 2024

OBTAINING RESIDENCIA IN TENERIFE – (UK NATIONALS ONLY)

Can UK Nationals still apply for Residencia in Tenerife/Spain?

You can still apply, but in most cases you will first need to apply for and obtain a VISA from the Spanish Consulate in either London, Manchester or Edinburgh in the UK BEFORE travelling to Tenerife. The types of Visa available and how to apply are set out below. Once you obtain a Visa, it will grant you a fixed period to complete the remaining residencia steps after you arrive in Tenerife (namely Empadronamiento Certificate Application followed by Residencia Application).

OBTAINING A VISA TO LIVE, WORK OR RETIRE IN TENERIFE

There are 7 different types of visa available to live in Spain, including retirees, investors, executives of a multi-national company, participants in a sporting or cultural activity etc.

The most commonly applied-for visas include:

NON-LUCRATIVE VISA

For those not planning to work in Spain, you can obtain this visa if you can show an income of at least €2,259.60 euros a month (or €32,270 for a couple), plus €564.90 for each additional family member/child), plus private Spanish health insurance cover for all applicants. Applicants CANNOT do any paid work in Spain under this Visa.

GOLDEN VISA

Investing at least €500,000 Euros in property in Spain (this can be retrospective within the last few years – 4 years has been suggested but we have been unable to obtain official confirmation of this).

WORK VISA

Only for highly skilled employees in a designated ‘shortage occupation’ position, which must be supported by the employer in question. Self Employed persons may also apply under the same criteria, by showing the full details and business plan of their proposed venture.

ENTREPRENEURSHIP VISA

Investing at least €1 Million Euros in Spanish Company Shares or Bank Accounts/Investments €2 Million Euros in Spanish Government Bonds.

STUDENT VISA

Enrolling in an accredited Spanish Higher-Education course, plus proof of financial means and medical insurance.

For those who do not qualify for any of the visas available, Spanish residency can sometimes be obtained in certain circumstances if your partner or a family relative is already registered as resident in Spain. Please check with the Spanish Consulate for the relevant criteria.

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To check eligibility for a Visa and to apply and/or to submit the application form and supporting documentation, you can check the latest requirements and book an appointment at your nearest Spanish Consulate office in the U.K. via the following link HERE

Spain generally imposes requirements to prove sufficient income to support the applicant and any dependents. Additional requirements include, but are not limited to, a criminal records certificate, a medical certificate, a financial reference (e.g. from a rental landlord or bank) and evidence that you have arrangements in place to transfer necessary funds to Spain (e.g. already having set up a bank account in Spain plus e.g. a direct debit to that account from your home bank, if your regular income comes from overseas).

Once you obtain your VISA and arrive in Tenerife, you may then proceed to apply for residencia by following the Step 1 and Step 2 procedures set out below.

Meanwhile, all UK Nationals can continue to enjoy Short Stays of up to 90 days during each 180 day window in the EU zone (including Tenerife).

HOW DOES THE SHENGEN RULE OF 90 DAYS TRAVEL IN EVERY 180 DAYS WORK?

UK passport holders can still visit the EU Shengen zone countries (which includes Tenerife/Spain) for up to 90 days in any 180 day period.

In other words, the first day you arrive in any EU country from 2021 onwards starts the clock ticking on a new 180 day period. During that 180 day window you can visit any combination of EU countries (including Spain/Tenerife) for any combination of 90 days in total. Once you extinguish that 90 day entitlement, you are barred from spending any more time in any EU country until the 180 day period expires.

Then, once that 180 day period expires, the very next time you step foot in any EU country, it triggers a new 180 day period, during which you can stay a further combination of 90 total days in any of the EU countries, and so on and so on.

No residency or visa application is required to enjoy the said 90 day window(s). You simply need a valid UK passport with more than 6 months validity remaining. However, to stay for longer in Tenerife/Spain, you currently need to apply for a VISA (detailed above).

Certain rag English press outlets in Spain continue to write utter nonsense on the subject. The latest ‘nugget’ is that the police are rounding up and deporting anybody who has overstayed the 90 day period. This nasty unsubstantiated rumour has now been debunked by the Spanish Ministry who has stated that there is no such policy to deport any Brit who has made Spain his or her home, but that they do recommend that anybody affected does now apply for residency as soon as possible, as failure to do so could affect any future legitimate Visa application. However, anyone leaving Spain as a serious or serial overstayer is likely to be subject to an interrogation at the airport and could be fined, or in serious instances, banned from entering Spain for whatever period the Spanish authorities may choose to impose. This will almost certainly be more closely monitored once the new digital ETIAS electronic travel system comes into force (estimated in 2024 / 2025)

Once you have obtained a Visa and have arrived in Tenerife, to obtain your TIE Residency Card, you will need to make 2 applications as follows:

Step 1

Application Form EX20 (application for residencia approval)

In addition to the application form, you will also need:

•  Valid unexpired UK Passport plus photocopy;
•  NIE Certificate plus photocopy;
•  Empadronamiento Certificate plus photocopy;
•  Proof of Medical Cover (registration for Spanish state healthcare, or Spanish Private Health Insurance). For health insurance, proof of the most recent payment(s) will be required (e.g. from a bank transaction slip, but not a bank statement). A transaction slip can often be downloaded via online banking (look for the PDF envelope icon next to the transaction).;
•  Proof of Financial Means – This is typically achieved by showing a Spanish bank account in your name with €5,350 balance for EACH applicant. The proof is a specialised bank certificate you can order, but a regular bank statement will not suffice. For those unable to raise such a lump sum, we recommend taking advice from a lawyer or other expert as to what may be accepted instead.
• 1 passport sized photo
• Completed form EX20 .
• Copy of the VISA you have obtained from the Spanish Consulate.

Once you have all documentation ready, you can apply for an appointment HERE  Select Santa Cruz de Tenerife, then select the relevant office, then click on POLICIA – CERTIFICADOS DE RESIDENCIA

Please bear in mind that appointments in Playa de las Americas Police Station are almost never available and instead you may have to travel to Santa Cruz (Calle La Marina 20) to apply – and again return there later to collect your new TIE card.

If your application is in order, you will be issued with a receipt of application. This documente is deemed as legal permission to reside in Spain whilst your application is being approved (or rejected). According to official police sources, you can use this temporary document to travel out of Spain and be allowed re-entry as a resident, thereby avoiding the 90 day in 180 day rule.

Step 2

Assuming your application is approved, then within a month of receiving that stamped approval, you must complete Application form EX23 to obtain the T.I.E. card and apply for another appointment, via same the booking link in Stage 1 above.

For UK Nationals following Brexit, the new TIE residencia cards will expire after 5 years (unless you have already had ‘permanent’ residence status for over 5 years (see below). However, any renewal should be little more than a rubber-stamping formality with a small fee.

Here is an example of the new TIE Residencia Card specifically for UK Nationals applying after 6th July 2020.

For UK Nationals, there is no longer any need to separately apply for “Permanent Residency” after completing 5 years of basic residency. This is because unlike with the old green cards, the new plastic TIE cards have a 5 expiry date. So when you later go to renew an initial TIE card upon its 5 year expiry, the police will note that you now qualify for Permanent Residency status, and hence will automatically renew and issue you a new plastic TIE card, this time marked as a ‘permanent’ one (although despite being called ‘permanent’ it still requires renewing every TEN years for a fee!).

UK NATIONALS already holding residencia in Spain – Swapping your existing residencia card for a voluntary T.I.E. card

If you already hold a green A4 or small green card residencia, then you DO NOT need to change it for a new TIE card. Many people are choosing to voluntarily change their cards, as they serve as an easier I.D. document than carrying a passport, but only whilst in Spain of course. Some officials are apparently refusing to accept the old style green residencias in certain situations. Sadly, this is pure ignorance on the part of the officials. The police have expressly confirmed that the old style green residencias are perfectly valid and hold the same status as the new TIE cards.

To switch from a green card to a new TIE card, firstly, download and complete Form EX23, which can be found HERE.)

You must then apply for an appointment online HERE.

• choose your province
• then select ‘Trámites Cuerpo Nacional de Policia’
• then select ‘Policía Exp tarjeta asociada al Acuerdo de retirada ciudadanos británicos y sus familiares’

You must attend this appointment at the police station in person (not online, nor via Power of Attorney) with the following documentation:

• completed application form EX23
• passport
• proof you have paid the fee (via form ‘modelo 790, code 012’ – choose option ‘certificado de registro de residente comunitario’)
• passport type photograph (you must ensure this meets the Spanish administration’s requirements)

Certain police stations may also require you to provide photocopies of official documents such as your passport at your appointment, so it is advisable to bring photocopies as well as original documents.

Then, once the TIE card is ready for collection, you will need to return to the police station YOURSELF (not using your Power of Attorney) with your valid passport to collect the TIE card. Guru understands there is no time limit for such collection, so the next time you come to Tenerife should be ok.

What if I already obtained (or filed an application for) Spanish residency before 31st December 2021? Where do I now stand with my rights to live and work in Spain?

Well the good news is that anybody who applied for  / or obtained Spanish residencia before 31st December 2020 (whether via the now-ancient ID photocard, the A4 green paper, the more recent green paper credit card size, or the new TIE card), your rights to live in Spain are now automatically protected under the Brexit Withdrawal Agreement and you do not have to do anything else.

However, for those holding one of the older forms of residencia, you can VOLUNTARILY choose to upgrade to the new-style T.I.E. Residency Card (a plastic card containing a photo etc, similar to the identity card for Spanish nationals, see example photo below). If you have already held your Spanish residency for more than 5 years, you that new TIE card will automatically carry “Permanent” status, and will require renewing after 10 years. Whilst those who have held Spanish residency for less than 5 years will automatically gain “Temporary” status and will need to renew their TIE card after holding it for 5 years.

For existing residents wishing to voluntarily upgrade to the new T.I.E. card, the procedure is set out further below under “Obtaining a replacement Residency Card. Or for those holding an old green residencia, they can simply choose to keep their old green card or A4 paper, as their residency rights are already fully protected and guaranteed.

Once I have residency status, how long can I stay outside Spain before I lose it?

During your first 5 years of residency in Spain (i.e. under ‘temporary’ residency status), an absence of more than 6 months from Spain in any 12 month period will TECHNICALLY rescind your right to residency. However, it is unclear whether the authorities plan to actively monitor or enforce this rule once new ETIAS biometric border movement checks are introduced from late 2024 / 2025.

Once you have held a Spanish residency card for 5 or more years (and it hasn’t been actively revoked for any reason), you achieve ‘permanent’ resident status and cannot lose your rights to that Spanish residency unless you spend more than 5 continuous years out of Spain. So somebody with permanent residency rights could simply return to Spain every 4.5 years (and advisedly stay for more than 3 months!) in order to retain those rights.

The above rules apply regardless of whether you obtained your residency before or after the 31st December 2020 Brexit cutoff date.

If I apply for the TIE card residency, does that make me automatically tax resident in Spain? What is the difference between ‘residency’ and ‘tax residency’?

Some people are scared that registering for Spanish residencia (i.e. having a Green A4 certificate, Green Credit Card Sized card, or new T.I.E. card) will somehow make them tax resident in Spain. Technically, A TIE residencia application does NOT make you tax resident in Spain, nor does it affect your existing TAX RESIDENT status UNTIL you spend more than 6 months and a day in Spain in any calendar year in Spain, or unless your centre of interests (e.g. your business headquarters and main family home) happens to be in Spain.

However, as mentioned above, to retain your residency, you are technically required to stay in Spain for more than 6 months each year, which on paper would obviously trigger tax residency. As things stand, it appears to be largely a case of what you declare, at least until you are unlucky enough to get a tax inspection! Many winter ‘swallows’ with Spanish residencia stay for only 3 – 5 months per year and declare non-tax residency status. Whether they will encounter a problem with that rather contradictory position once the ETIAS system comes into force remains to be seen.

So unless you declare tax residency, you will essentially remain TAX RESIDENT in your home country and you will be treated as non-resident in Spain for tax purposes. Holding a green or TIE residencia card simply indicates your intention (and grants you the right) to stay in Spain for more than 90 days. It does nothing more than that and it is entirely separate to the tax residency rules.

For those doubting the above information and wishing to double-check the Spanish tax residency rules, we would recommend that you read the following information published on Price Waterhouse Coopers website (the largest firm of Chartered Accountants worldwide):

https://taxsummaries.pwc.com/spain/individual/residence

Regardless of whether you have basic Residency or full Permanent Residency, you are legally required to take certain additional steps to inform relevant parties that you are now in fact resident. These include your bank, your employer and of course, the Spanish tax office (Agencia Tributaria).

A fair percentage of foreigners living in Spain (who may already hold the basic green Residencia card or even a Permanent Residency card) still fail to comply with one or more of the fiscal/tax requirements. Whilst there are downsides to being fiscally resident in Spain (e.g. Spain will want to tax you on your worldwide earnings), there are various advantages, e.g:

• Resident bank accounts attract lower fees than non-resident accounts.
• Residents routinely receive more generous mortgage deals on better terms.
• Residents are not charged ‘notional income tax’ on their principal residence in Spain (Non-residents are taxed on a notional 2% income on each property even if they don’t actually rent it out!)
• Residents can make lifetime gifts or leave assets in Tenerife under their Will to first line descendants with a 99.9% reduction on Gift Tax or Inheritance Tax.
• Residents can sell a property in Spain without the buyer having to deduct 3% retention on account of your potential Capital Gains Tax liability
• Residents over 65 who have lived in a property for 3 years don’t have to pay any Capital Gains Tax when they sell, regardless of the profit.
• Residents may offset the costs of purchasing a new home against any capital gains applicable on selling their old home.
• New Residents may import a vehicle and various other personal effects within 12 months of arrival without paying the usual Customs Import Tax (subject to conditions).

As stated above, the potential disadvantage of being fiscally resident is that Spain will tax you on your worldwide income. However, this may not be a disadvantage to everyone. Many countries have higher income tax rates than Spain, but in Spain the higher-rate tax calculation kicks in at a lower amount than in most countries. Also, many countries have double-taxation treaties, meaning that if you have to pay tax in a foreign country, your country of residence (i.e. Spain) will give you a credit for that overseas tax paid, meaning that you don’t pay twice.

An additional disadvantage with being fiscally resident in Spain is that since 2013 residents are required to declare all assets held in other countries where those assets (or group of assets within one type) are worth in excess of €50,000 Euros. The relevant form for making the declaration is Form 720. Penalties for non-disclosure can be severe. The form can be completed online HERE if you have an electronic NIE / DNI or alternatively a ‘Cl@ve’ PIN.

Failure to correctly register your true residential status can also technically result in a fine of €300. However, TENERIFE GURU has not heard of any case where this fine has been levied. We also suspect that €300 is not an effective deterrent for those with more to gain financially by avoiding Spanish residency.

The requirement to file a Resident Tax Return depends on your personal circumstances and applies regardless of whether you have yet applied for basic or permanent residency.  If you spend more than 183 days in Spain in any calendar year, or have your centre of economic or vital interests in Spain, then you will be considered a resident for tax purposes. Thereafter, if you also earn greater than €22,000 income from any source in the relevant tax year (salary, dividends, business income etc), then you are required to file a Residents Tax Return.

Those actual residents who don’t file a ‘residents’ tax return are liable to late filing penalties plus interest on any tax payable. The taxman can go back up to 4 tax years in respect of false or non-declarations and unpaid tax. In addition, those who fail to register for tax-residency at all may be excluded from certain resident’s exemption schemes (e.g. a 99.9% inheritance tax reduction on assets they leave in the Canary Islands upon death).

Contrary to popular belief in some quarters, non residents in Spain must also file a non-resident tax return if they own any property in Spain, or earn more than €22,000 per annum from all of their Spanish based income.

For most foreigners who own a property in Tenerife but don’t earn any significant income here, they are simply required to complete and file a basic tax return (Modelo 210). Under this form, the taxman charges standard income tax upon a notional income of 2% per annum on any property held by a non-resident, even if the property is not rented and generates no actual income. This rule was introduced many years ago in response to the vast majority of non-resident owners renting out their properties but failing to declare the income. It is quite unfair on honest owners who don’t actually rent out, but that is the current law. Hence, the owner of a small apartment will typically pay a few hundred Euros per annum in respect of this tax.

Those non-residents who do rent out their property and who generate more than 2% income per annum are required to file a more detailed tax return, depending on the individual circumstances.

Due to the greater complexity (and cost) involved in filing a more detailed return, it appears that many non-residents just file the basic Modelo 210 and take their chances that they won’t get caught. Naturally, Tenerife uru could never endorse such a brazen approach! The taxman is also stepping up checks to try to catch those renting out their property for a substantial part of the year. Such checks now include reviewing electricity and water usage for the property. Where such usage exceeds the deemed average use for 6 months per year (i.e. more than 50% of a typical permanent resident’s bill), further investigations may be conducted.

FINAL NOTE: There is the strong possibility that Spain will soon grant UK nationals a new special status for residency applications (e.g. similar to that already granted to Norway and Switzerland). So any UK Nationals considering making a Spanish visa application which isn’t urgent, should perhaps hold on and see if the rules change in the coming weeks or months, rather than immediately jumping through the above hoops to apply for a third country visa via the Spanish Consulate in London, Manchester or Edinburgh.