Insight into tax efficient savings in Spain

Spain Tax, Spanish Tax, Saving in Spain

A stronghold for your savings

It is that time of year again when attention turns to tax in Spain. The time of year when we add our worldwide

This year it is particularly important. Firstly, the Renta Declaration has to correspond with our Form 720 (Modelo 720). Secondly, the G8 are addressing the issue of tax which includes implementing more automatic exchange of information between countries.income to the “declaración de la renta”.

Despite this “crackdown”, in many countries there are tax efficient ways of saving. In the UK this includes ISAs and in France the Assurance Vie (Life Assurance) as examples. Tax efficient Saving in Spain is also available in a simple and effective manner using a unit linked insurance. With tax only paid on withdrawals, the fact your investment grows free of tax can make a big difference.

Amount Invested Rate of Return

Value at 5yrs

Value at 10yrs

Value at 20yrs

100,000€ 6.90% Gross Roll Up




100,000€ 5.45% (6.9% TAXED AT 21%)








The rate of return of 6.9% is used as an example only and has been used as it is the average return on a diversified portfolio in the last 10 years.*

Tax is payable in the following manner

100,000€ invested

grows to


which is 100,000€ capital and 50,000€ gain

On a withdrawal of, say, 30,000€

 Treated as 20,000€ Capital and 10,000€ gain (ie in same proportions as above).

 10,000€ taxed at 21%

equals 2,100€

2,100€ on a withdrawal of 30,000€ is an effective tax rate of 7%

Would it help if your investments in Spain were tax efficient? If you would like more information, please email at or telephone me on 645 257 525

You may also be interested in

Spanish Tax Facts

Spanish Tax Facts

* This rate of return is an example only and does not imply that savings will make this specific rate of return. Indeed, values will go down as well as up. The information is based on our understanding of the law and tax rates as at 19/06/2013 for basic rate capital gains tax payers and may vary in the future. Individual advice is only given after conducting a review of your particular circumstances.

Author: Barry Davys

Expat Financial Advice Spain


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