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Spain - Retirement

Spain is one of the top choices of expat destination for those who want to retire. There are many reasons for this but one of the main ones is the excellent climate. The laidback way of life is also attractive and – for pensioners in particular – the low cost of living has a lot to do with it. Pensioners are able to enjoy a good quality of life and due to the short flight times to other parts of Europe, many people see it as being a very accessible place.

There are no specific schemes to attract retirees to Spain, although there is a retired person’s visa (visa de jubilados) available for those who need it. This means that the applicant will have the right to live in the country without working. In order to apply for this visa you will need to have documentation which proves that you are in receipt of a pension and give all the relevant details, proof of any other income that you have and proof of ownership of any property in Spain. The applicant needs to be able to prove that they can support themselves and any dependents while they are in Spain. It may be a requirement to get medical insurance as you may not qualify for state healthcare.

The retirement age in Spain is currently 65 but there are plans in place to raise this to 67 over the next few years, as Spain is seeing similar problems to the UK in terms of pension arrangements and the economic problems. The retirement age will not start to rise until 2013, but this will also have an effect on the way the state pension is calculated. At the moment the state pension is calculated using the contributions made in the 15 years prior to retirement, but the new system will take into account the previous 25 years.

Expats that are living and working in Spain and have done so for a number of years may qualify for the Spanish state pension if they have made the minimum number of contributions to the Spanish social security system. At present the current standard is 15 years but this is due to rise to 25. A person who has paid into the system for 35 years receives the full pension. Those who do not receive a full pension may be entitled to a top-up by the government if their income is considered to be low. Payments to a social security system in another country may be taken into consideration.

Company pension and private pension schemes are common in Spain and are often used as an additional source of income for Spanish retirees. If you do not think that you will be working in Spain long enough to claim the state pension then you need to contribute to a private pension. Private pensions can be arranged through a number of financial services providers such as the banks. It is often recommended – particularly for those who do not have a fixed income each month – to pay lump sums in when you can rather than a fixed amount each month. There is often a minimum monthly payment if you choose that option although the lump sum can be done at any time.

Payments that are made to a company pension scheme in Spain are tax deductible although there will be a maximum amount which is based on the age of the contributor.

There is currently a treaty in place between Spain and the UK which means that if you live in Spain but receive a pension from the UK, it will be taxed in Spain. It is the responsibility of the recipient to inform the pensions department in the UK that this is the case so that pension can be sent with no deductions. It is also the responsibility of the recipient to declare the monies to the tax office in Spain. However, if you are receiving a pension from the civil service then you may find that you cannot prevent this from being taxed in your home country, although you can stop it from being taxed a second time in Spain.

There are a number of different ways in which you can receive a pension from abroad while you are living in Spain. In many cases it is paid directly into a bank account in your home country, but you can be paid via cheque. It is possible for the pensions department to send the cheque directly to your bank or building society.

Useful Resources

Social Security Department website (English language option available)

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Expat Health Insurance Partners

Bupa Global

At Bupa we have been helping individuals and families live longer, healthier, happier lives for over 60 years. We are trusted by expats in 190 different countries and have links with healthcare organisations throughout the world. So whether you're moving abroad for a change of career or a change of scene, with our international private health insurance you will always be in safe hands.


Cigna has worked in international health insurance for more than 30 years. Today, Cigna has over 71 million customer relationships around the world. Looking after them is an international workforce of 31,000 people, plus a network of over 1 million hospitals, physicians, clinics and health and wellness specialists worldwide, meaning you have easy access to treatment.