How Do I Lose My UK Domicile as an Expat in Spain?

As a UK expatriate living under the sun-drenched skies of Spain, you may be considering changing your UK domicile status. The concept of domicile in the UK is tied to the country you regard as your permanent home or have the closest ties with. Losing your UK domicile status can be a complex and intricate process, one that is influenced by your personal circumstances, intentions, and connections to your new home country.

Your original domicile is usually acquired at birth, generally reflecting the domicile of your father at that time. This initial status, known as ‘domicile of origin’, tends to stick, even if you relocate to another country such as Spain. However, it is possible to replace this with a ‘domicile of choice’ by settling in a new country with the intention of staying there indefinitely.

Living in Spain, enjoying the vibrant culture, and integrating into Spanish life might seem like it’s enough to lose your UK domicile. However, the UK authorities examine both the physical evidence of your ties to a country and your intention to make it your permanent home. The UK tax authorities, HMRC, may still consider you UK-domiciled if you maintain strong links with the UK. These could be owning property, having UK investments, or if your intention to stay in Spain isn’t clear or permanent.

To effectively lose your UK domicile status, you’d need to demonstrate that you have severed your ties with the UK and have the intention of living in Spain permanently or indefinitely. This could include selling UK property, closing UK bank accounts, investing in Spanish assets, and integrating into Spanish society, amongst other things. A clear and documented intention of never returning to live in the UK is crucial.

However, changing domicile is a major decision and isn’t right for everyone. The implications extend beyond just tax and can affect other areas such as inheritance and family law. Thus, getting this right is vital, especially considering Spain’s distinct taxation system, including wealth, inheritance, and income tax rules that differ from those in the UK.

In this complex terrain, seeking professional advice can be incredibly beneficial. Chorus Financial, a specialist in cross-border financial planning, can provide the guidance you need. Their team can help navigate the intricacies of tax laws and domicile status, ensuring you make informed decisions that best serve your financial needs while living in Spain. Contact Chorus Financial today to ensure you’re on the right track in your domicile journey.