I have a bit of a strange question but hopefully someone might be able to help me.

I am a UK citizen and live and work in Spain. I have some savings in pounds in the UK and was planning to buy property in Spain. But given the current economic climate have decided to wait a while.

The problem is I have little faith in Sterling and would like to get out of it as soon as possible, but I don?t think any other currency is any more secure. I am planning on buying gold and waiting for a year or so. The vault that I?d buy from say that when I liquidise the gold I can change it directly into Euros in a Spanish account (they have vaults in London, new york and Zurich).

What would be the situation for paying tax on this?

From what I can gather, investment-grade gold is exempt from VAT and IVA (in both Spain and UK). But I think I would have to pay capital gains tax on any profits made (assuming there are any).

Would I pay them in Spain and UK? (With a tax deduction on whichever is worth less)

In Spain, I think there are deductions if you immediately re-invest any capital gains in a property. Could this apply here, if I bought a flat directly?

Thanks,

T

I am not a tax expert but - if you are a permanent resident in Spain you should be making a tax declaracion here in Spain.

Yes it is true that any capital profit made from the sale of a property will not be fully taxed if it is re-invested in another property but to have this tax benefit you have to be fiscally resident (as against just a person with a residencia)

Whether that rule applies to profit on gold trading is debatable - I would tend to think not, the rule is intended for gains on property sales only I would think. After all other investments are taxed at the standard rate of 18% on the profit ie. stock market gains.

I suggest you take qualified professional advice before committing to trading in gold as to your tax position.

Ok rob - thanks for the reply.