Can You Get Your UK Pension in Spain?

One common question among British expatriates residing in Spain concerns their UK pension: can you get your UK pension in Spain? In simple terms, the answer is yes, you can.

If you’ve spent your working life contributing to a UK pension scheme, it’s only natural to want to access those funds in your retirement, even if you’ve chosen to spend your golden years abroad. Thankfully, as a British expat living in Spain, you can indeed receive your UK pension.

In fact, your UK state pension can be paid into either a Spanish bank account or a UK bank account, depending on your preference. If you choose to receive your payments in a Spanish bank account, the amount will be converted into euros. You will need to consider fluctuations in the exchange rate, as they can affect the value of your pension in euros.

It’s also worth noting that the UK state pension is subject to the “triple lock” guarantee. This means that your pension will increase each year by whichever is the highest of 2.5%, the rate of inflation, or average wage growth, even while you’re residing in Spain.

Furthermore, you can also transfer your UK private pension to an overseas scheme such as a Qualified Recognised Overseas Pension Scheme (QROPS). This route can offer potential tax efficiencies and may provide you with greater control over your pension funds.

However, Spain’s tax laws are different from those in the UK. As a UK pension holder in Spain, it’s vital to understand your tax obligations, including income tax on your pension and potentially Spanish wealth tax. Therefore, careful planning is necessary to maximise your pension while minimising any tax liabilities.

The pension landscape can be quite complex for expats, given the many variables at play, including exchange rates, foreign tax laws, and the ongoing changes in UK pension regulations. Consequently, it is always wise to seek expert advice.

If you have any questions or need advice on your UK pension while living in Spain, do not hesitate to contact Chorus Financial. Their experts, well-versed in UK pensions and Spanish tax laws, can provide valuable guidance tailored to your unique circumstances.