As we enter 2026, many British expatriates in Spain are reflecting on whether their financial arrangements still make sense for the life they are living today — and the future they are planning for tomorrow. Ongoing changes to tax rules in the United Kingdom, combined with the complexities of Spanish taxation and succession law, mean that financial planning for expats has never been more important.
A structured financial review can help ensure that your tax planning, pensions, investments and estate arrangements remain aligned with your goals, your family circumstances and your life in Spain.
Why Regular Financial Reviews Matter for Expats
Financial planning is not a “set and forget” exercise, particularly when you live outside your country of origin. Tax regimes, pension rules and investment environments change regularly, and strategies that were appropriate a few years ago may no longer be suitable.
A regular financial review can help you to:
- Keep pace with changes in UK and Spanish tax legislation
- Identify inefficiencies or unnecessary risks
- Ensure ongoing compliance across jurisdictions
- Adapt your plan as your personal circumstances evolve
Life events such as retirement, selling UK property, receiving an inheritance, or relocating within Spain can all have significant financial implications. Reviewing your arrangements holistically helps ensure that each part of your financial plan continues to work together effectively.
Tax Planning: Managing UK and Spanish Exposure
For British expats, tax planning often spans more than one country. Income, assets and investments may be subject to different rules depending on where they are held and where you are resident.
Key considerations include:
- Are your assets structured in a tax-efficient way for a Spanish resident?
- Are you meeting your tax obligations in both Spain and the UK without unnecessary duplication?
- Are you taking advantage of tax planning opportunities available under Spanish legislation?
Recent UK tax reforms have increased the burden on many expatriates, particularly those who retain UK-based assets. Property owners and landlords, for example, have faced rising costs, reduced allowances and increased reporting obligations. In some cases, capital tied up in the UK may no longer be working as efficiently as it once did.
Inheritance tax changes, frozen thresholds and rising tax rates on investment income have also reduced the long-term efficiency of some UK-based strategies. Cross-border tax planning is complex, and specialist advice can help you navigate these changes with greater confidence.
Pensions: One of the Most Important Decisions You Will Make
Decisions around pensions are often among the most significant financial choices an expatriate will face. UK pension rules continue to evolve, and living in Spain does not remove your exposure to UK legislation.
Questions to review include:
- Are you aware of recent and upcoming UK pension reforms?
- How could inheritance tax changes affect your pension benefits?
- Is your pension structure still appropriate for someone resident in Spain?
From April 2027, most UK pension funds are expected to fall within the scope of UK inheritance tax. This applies regardless of where you live, making early and careful planning increasingly important. A professional cross-border review can help you understand your options and how they align with your retirement income needs and wider estate planning goals.
Estate Planning: Aligning Two Very Different Systems
Estate planning is an area where the differences between the UK and Spain can be particularly stark. Succession laws, inheritance taxes and beneficiary rules differ significantly, and without careful planning, British expats can face unintended outcomes.
UK inheritance tax receipts have risen steadily for decades, driven by frozen nil-rate bands and increasing asset values. Pensions are also expected to play a greater role in taxable estates going forward.
Spain presents a more varied landscape. While Spanish succession tax can apply to worldwide assets in certain circumstances, several regions — including Andalucía, the Balearic Islands, the Canary Islands, Madrid, Murcia and Valencia — have significantly reduced or effectively eliminated inheritance tax for spouses and children.
For families, this can make parts of Spain a comparatively attractive environment for passing on wealth. However, the interaction between UK and Spanish rules must be handled carefully. Keeping UK assets within relevant thresholds and structuring wealth appropriately can make a significant difference, subject to individual circumstances and advice.
Savings and Investments: Designed for the Right Country?
Many expatriates continue to hold savings and investments that were originally set up for UK residents. Over time, these may become less suitable for someone living in Spain.
A financial review can help answer important questions, such as:
- Are your investments aligned with your current objectives and time horizon?
- Do they reflect your personal attitude to risk?
- Are they structured to help maintain purchasing power in the face of inflation?
- Are there tax-efficient investment options available in Spain that you are not currently using?
Your investment strategy should always be tailored to your personal circumstances. Diversification across asset classes, regions and currencies can help manage risk, while multi-currency flexibility may assist in reducing exposure to exchange rate movements.
Bringing It All Together: Integrated Financial Planning
Effective financial planning is about more than individual decisions. Tax planning, pensions, investments and estate arrangements all interact, and changes in one area can have unintended consequences elsewhere.
Taking time at the start of 2026 to review your financial position can provide clarity, confidence and peace of mind — helping you move forward with a plan that is designed for the years ahead.
Financial planning considerations for expatriates can be complex. If you have questions about how these issues may relate to your circumstances, you can contact us for further information
This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
Is it time the 21 million people with over £60 billion saved should cash in their Premium Bonds? Of course, you could just win millions! Premium Bonds are a savings product where the interest is based on a monthly prize draw and the annual prize rate is dropping from 1.35pc to 1.25pc. This is the average return, indicating that for every £100 paid in to bonds, on average £1.25 a year is be paid out.
Living as an