Pensions in Spain

Pensions in Spain

We continue to get enquiries about pensions in Spain and specifically for advice in three main areas-

  1. Tax information requests, and best options for pensions in Spain.
  2. Advice on whether to transfer UK pensions, now the investors are resident in Spain.
  3. Requests for information about our Forensics Service  for those that have pensions in QROPS or ‘international sipps’  that are not performing as expected.

Tax information requests – Modelo 720

We have referred to this declaration in a previous blog and it would appear, from feedback that we get from residents in Spain, and their accountants, that pensions in Spain may have to be declared depending of the type of pensions they are.

Although a declaration on a Modelo 720 does not in itself trigger a tax charge, if the pension holds investments then there may be a tax on the gains each year- even if the pension is not being taken!

We do not claim to be tax experts and so we refer to the accountants who are, but we get different feedback on this, and so we recommend pensions in Spain should be declared, even if not in payment, and especially if in a QROPS or International SIPP.

UK Pensions in Spain- Pension Freedoms 2015 – how they affect you if you have a UK pension or QROPS

We need to look at this from differing perspectives. The Spanish Tax office take the view, according to feedback we have had, that if the pension can be cashed in – which is available to money purchase pensions for anyone over 55- then tax should be paid on an annual basis.

Malta Pensions in Spain – QROPS

Since Malta has also legislated to allow full encashment from 55, then they would be similarly affected as the UK pensions.

Gibraltar/Channel Islands Pensions in Spain – QROPS

Gibraltar and the Channel Islands were popular jurisdictions for QROPS and Gibraltar and some of the Channel Island QROPS did not provide full access to the funds. On the face of it, that could mean that they would not suffer the same tax. However, given that they are trust based, and Spain does not recognise trusts, they could be treated as non-pension investments and would be taxed anyway. Talk to an accountant in Spain.

Final Salary and Annuity Pensions in Spain

As neither of these can be encashed ( There is no current market to allow annuities to be sold and final salary schemes cannot be encashed without first being transferred ) then these will be treated as pensions and tax would only be payable when the income is taken.


If you are tax resident in Spain and have a personal pension (International SIPP, SIPP or any UK money purchase pension) you should speak to your accountant locally for an opinion on what needs to be declared. The same applies if you have transferred to a QROPS.

If you have a final salary pension and you are being advised to transfer it then, again, speak to an accountant before transferring as there is no reverse gear on such a transfer. Moving it to a QROPS could be the worst of all worlds when it comes to tax, although there may be other reasons for requiring a transfer.


The views expressed in this article are not to be construed as personal advice. You should contact a qualified and ideally regulated adviser in order to obtain up to date personal advice with regard to your own personal circumstances. If you do not then you are acting under your own authority and deemed “execution only”. The author does not accept any liability for people acting without personalised advice, who base a decision on views expressed in this generic article. Where this article is dated then it is based on legislation as of the date. Legislation changes but articles are rarely updated, although sometimes a new article is written; so, please check for later articles or changes in legislation on official government websites, as this article should not be relied on in isolation.

This article was republished on 24th April 2019


Chris Lean

Chris is a Chartered Financial Planner who writes blogs and articles to simplify and explain some of the financial issues that affect UK expats. Subjects include; hot topics, regulation and the ever-changing world of finance.

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