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British residents in Spain after Brexit

British residents in Spain after Brexit. Ever since the referendum in 2016, British and European press outlets were full of predictions and prophecies about the outcomes of the vote. 

From catastrophe to paradise, commentators had a lot to say about trade, working rights, movement and other issues that now had to be negotiated by both sides. And, even with Brexit’s final confirmation in 2020, many of these issues are still to be solved at the time of writing. 

Political and economical factors

Political and economic factors have been very influential throughout the negotiations, and many basic agreements have been reached under pressure and last minute ultimatums. Established projections and predictions have been completely destroyed after elections or summits.

Some of these predictions at times sidelined the very real impact of the UK’s exit from the European Union for certain groups of citizens. That is, those Brits who had relocated to Spain before the referendum. Until then, they could rely on multiple continent-wide rights: healthcare, easy access to their pension, even permission to vote in local elections. Optimistic proclamations assured “Brexpats” they would be able to rely on these rights, as the UK would seek reciprocity by upholding EU citizen rights in Britain.  

For more pessimistic observers, however, these British expats now faced exclusion from everything. This was a worrying prospect for many, especially considering the relatively advanced age of many of these residents in Spain and their need to access healthcare and other services.

Between the light and the darkness of these predictions, what is the situation for British residents in Spain after Brexit?

Right to remain in Spain for British expats?

Since it is an affair first launched by London, the UK is most advanced in coming up with a new regime to regulate migration to the country. In the particular case of European Union citizens, who used to enjoy freedom of movement and indefinite right to remain, the British government has launched the settlement scheme. 

This scheme allows European citizens to claim the right to remain if they entered the country before the end of 2020. In the future, the Home Office announced, the UK envisions a point-based migration system in the style of Australia which should apply to all foreigners. However, will EU citizens And why does this even matter for British expats in Europe, or Spain?

Well, while the term “bargaining chip” might sound a little rude, it is true that negotiators on both sides are relying on existing migrants and their established presence across borders to seek reciprocity. In short: Spain, like other European governments, is willing to grant the right to remain for British citizens as long as London allows Spaniards working in the UK to retain the same rights. 

Problematically, until now the bulk of official negotiations has taken place between the EU as a whole and the UK, which means that national positions on the issue are difficult to ascertain. However, since bilateral exchanges of people amount to the hundreds of thousands between Spain and Britain, it would be against the interests of both administrations to place their migrants in a difficult position.

What would the worst arrangement look like for British expats in Spain? 

From losing their right to access free healthcare, to having to request visas if they do not choose to become permanent residents; there are Perhaps losing the opportunity to vote in local elections does not feel like a tragedy for many Brits. However, if they think again, they will be paying taxes to municipal bodies while having no say on their decisions. 

In practice, Brits would join the rest of the extra-European world in terms of having mobility to Spain, between Spain and Europe, and all the other additional rights linked to the right stay in the country indefinitely. 

How will taxes be affected in Spain and the UK after Brexit?

In terms of taxes and other economic concerns, the UK-Spain double tax treaty is unaffected by Brexit and covers both income and capital gains tax. However, perhaps certain regional taxes on property could change their disposition if Britons become third-country citizens. Other issues such as inheritance, due to differences in family law, could be affected and impact British incomes. Finally, Brussels-dependent advantages, such as the end of roaming fees or common consumer rights procedures, will surely affect British citizens when signing mortgages or conducting daily business in the country. 

There is, of course, an alternative. Again, based on the intense transnational connection between both nations, it would be advisable to reach a bilateral agreement on these issues. Both Spain and the UK have special arrangements with other nations, due to historical or cultural ties, that assist citizens seeking to relocate in facilitating everything from visa arrangements, settlement renewal periods, right to travel in the EU.  

The problem with all of these advantages is that they are unlikely to be negotiated bilaterally, until the EU as a whole and the UK reach some sort of conclusion to the negotiating period opened in 2016. 

For the sake of British expats, and Spanish workers in the UK, it might be good for governments to start talking as soon as this conclusion is reached. 

Conversations will last for a long time, as issues as diverse as transnational litigation, firm finances or intellectual property regimes will have to be re-examined. 

As always, the best option to avoid unexpected surprises is to always check with legal experts, like those at Del Canto Chambers. Del Canto experts are used at operating across both jurisdictions and will be ready to react quickly once Spain and the UK reach a final agreement. 

By Del Canto Chambers