BUYING A BAR IN SPAIN

For many it seems like the easy option of making a living after moving to Spain. But for many the dream turns into disaster.

Ill thought out planning and with no idea of the market many fail before they have been given the chance to start.

One salient factor is often money. Usually not enough in reserve to get a business going.

Ill thought out business planning or none at all leave newcomers to the Costa Blanca without a chance of success.

Over the last 12 months we have seen bars sold and then sold and then sold. More often they are just abandoned by those whose dream has disappeared.

For anyone contemplating buying a bar on the Costa Blanca they should err on the side of caution and work out before hand how much they can realistically afford and how they intend to run the business.

Prices of bars have clearly reduced to a more acceptable level but there are agents out there who will make money from you if you do not do your research first.

Before you do anything. Have a good look around on your own. Work out where is busy and why. Then look at where isn't and why!

Whilst there are a number of trusted agents on the Costa Blanca, make sure you do your research first and don'tbe persuaded into buying something you don't want.

For anyone please make sure that you have sufficient funds behind you to keep you going whilst you build your business.

It doesn't really matter what trade the previous owners had - it's what you make of it when your in there that matters. Attracting the customers is priority - keeping them is paramount!

There is undoubtedly stiff competition, the hotels with all inclusive deals have taken their toll on the local trade. However, if you get is right you will succeed.

There are helpful sites to assist in finding the right bar or restaurant and information on how to go about buying a business. Check out http://www.businessesbylawyers.com/ or http://spainbusinessguide.com/ where you will find the information you need.

No bar or restaurant should be bought without obtaining independent legal advice. There are many bars operating without a licence and there isn't the prospect that they will ever get one. It pays to check these things out before you commit to a purchase. You might find it is money well spent.

If you want information generally on Benidorm and the surrounding area then you should see http://www.realbenidorm.net/

For legal advice and assistance on buying a bar or restaurant then see http://www.costablancalawyers.com/ They will help you and advise.

EDUCATION IN SPAIN

It is often said that the biggest decision made when moving to Spain is the education of a child. Much depends upon the age and ability of the child, but taking into account their personality is often something that is overlooked. Yet it is the one thing that can make or break a child in a new school, especially if they are dealing with a new language.

There are two schools of thought surrounding the education of foreign children in Spain.

Either put them in Spanish school and see how they go OR

Put them in a private English School.

There are actually sound reasons for both. It should be said that consideration of the future of the child should be the primary concern.

Consideration should also be given as to whether in reality your move to Spain is a long term permanent one or whether it is only likely to be for a short period.

For many the return back to the UK causes the children more problems than the move to Spain because they have been out of the UK education system for too long to be able to cope with what is expected of them on their return.

The Spanish education system works towards the baccalauriat (equivalent of GCSE/A levels) and it is internationally recognised.

Your child will also be totally bi-lingual which can only be a benefit in an ever shrinking world.

The Spanish Education system provides further benefit in that the expat children are integrated into the Spanish Community and they learn about Spanish Values and customs meaning that life generally for them is much easier.

For those with children of 10 plus consideration of a Private school is sometimes not an option but a must because the state schools will not accept children who are not fluent in Spanish in the institutes. Quite often attempts to go through the state system at this age fail, leaving more difficulties of how to educate the child.

The cost of private education does not come cheap and is relative to private education/cost of living.

If you do choose to put your child into private school be prepared for them to remain there until they complete their education or until you return to the UK.

One downside to private education is that for the children attending their command of Spanish is far interior to that of children in state schools.

One difficulty often encountered when a child leaves an English school is that they are often unable to find employment in Spain and they return to the UK leaving the parents in Spain. Or they return to the UK to complete their education at univercity or college. This is something which often was not envisaged but which sadly is a common occurrence.

If your children are younger and you intend to remain in Spain it is worthwhile considering the Spanish system, they will benefit. Some critisise the spanish system as not been as good as the english system. Weighing up the balance is a matter for the parents and the children.

There is no right or wrong option it is purely personal at the end of the day.

Do bear in mind that older children do find it harder to integrate and learn the language.

LIFE IN SPAIN IN 2010

One paper recently quoted “End of the Eldorado dream: A plunging pound and property crash have left thousands of expat Britons on the breadline”

For some sadly this may be right. Particularly those who retired to Spain, bought a property with a mortgage and relied on a pension, whether it be private, state or both.

Taking a closer look at those living in Spain. Many have been here for years, have worked hard and retired benefitting from their cross border life with a spanish pension paid in euros.

Younger people having moved to Spain have integrated into the spanish system and do not rely upon the pound for their income. Their life is totally immersed in Spain. Any pension entitlement they may have in the future from the UK is likely to be very small.

Where working people are suffering, and indeed closing their bars and restaurants, is in areas reliant upon the pensioner and tourist trades. This affects everyone. Yes pensioners are not eating out as much, if at all and are remaining at home.

The Tourists to the area are clearly lower. With hotel price wars and all inclusive deals around it is clearly a choice for the visitor. But are the tourists staying away at the levels reported. That might not be that clear cut.

In Benidorm there is certainly a downturn in business leaving many established bars and restaurants struggling and many more closing.

But the dream of leaving the UK to run a bar has never been easy. How many over the years have done so only to return having failed? More than you may think. The turnover of bars has always been high. It's just that now the prices for the sale of a bar have dropped significantly in line with demand.

It´s not easy to move to another country, particularly if you have children, and everyone considering doing so should look closely at their future aspirations it may not be that of their children.

For those under an illusion that life in Spain is all sun, sea and sangria, let´s be honest those that work have to work twice as hard to succeed. It doesn´t really matter what you did in the UK it is what you have to offer in Spain that matters.

Employment in Spain for the expats has never been easy to come by. Failure to speak Spanish is a common flaw. This leaves many unable to gain employment. With the need to work paramount to remaining in Spain they work on the black, usually odd jobbing, painting, decorating, gardening, pool cleaning etc. Unfortunately, when times are difficult these are the luxuries that people cut back on.

It goes without saying that the property boom is over anyone who tries to say otherwise is mad. However, how harmful is this? The property prices in Spain, particularly on some of the Costas really did become overinflated, leaving a seller to name their price without anxiety of whether a property would sell because it always did.

With the slump of the property market has come the dawning of the true worth of a property. Everyone believes that their own property has a high value, but the time has come for honesty. The true value of a home is the amount a person is prepared to buy it for.

However, as with all other things, when times are tough there are always those with money to invest. Without doubt property sales continue albeit at a lower price but the buyers are usually cash buyers looking to invest for the future.

The lack of mortgages around is causing difficulty but until there is more confidence from the banks this will not change.

Another reason for the downturn in mortgages in Spain is their requirement of correct paperwork, something not necessarily requested before to give a mortgage.

Holiday home purchasers are certainly down, particularly those from the UK but again this will continue into and possibly to the end of 2009 until the pound becomes stronger.

No one can really envisage what will happen with the pound against the euro although general feeling is that it will get worse before it gets better.

Living in Spain at the moment for some may not be easy but look at the alternatives.

For those on a pension they have seen their income eroded by 30% in a 12 month period.

The cost of living in the UK was significantly higher than Spain but you do have to question whether or not that is now the case. The supermarket wars in the UK mean shopping is at a record low. It doesn't help that the cost of electricity and water in Spain has increased over the last 12 months.

The climate is often a reason to move to Spain in the first place, bringing better health for the elderly and retired.

For the young returning there is the misplaced belief that they can claim benefits as soon as they arrive. To claim benefits in the UK you should be habitually resident and this is often a little difficult to explain having just got off a plane, being out of the country for several years. The time involved in resolving these issues works against the theory of the benefits immediately and often causes anxiety over and above that experienced in Spain.

Apart from the climate there is life itself. The streets are safer, crime is lower, ok the drivers are a bit nuts, but by and large Spain is a much better place to live.

Now, more than ever, is the time to support one another and where possible ensure that as many as possible can remain in Spain. Tales of the poor Brits abroad do not go down well in the UK, some have said you left, it´s your own fault you´re in this mess not ours! Sympathy for those struggling in Spain is limited. Let´s face it for years we have been the envy of those who did not have the courage to move themselves. Envy can be evil.

One final point, comment has often been made of the Brits in Spain, but who in all honesty is keeping the economy alive. If you removed the Brits in Spain the reduction in the Spanish economy would be astounding. Moreover the Spanish know it!

BANKING IN SPAIN IN 2010

It is not uncommon to hear surprising stories about banks in Spain. They are in fierce competition and in some ways struggling to come to terms with the demands of their clients. However, that is good news for the customers.

The British on the Coast have seen it all before when from the 90’s onwards when the banks were offering anything and everything to anyone.

It must be remembered that Spain whilst steeped in history, has only really developed since the Civil Code was written and Franco deposed some 30 years ago. It has, however moved on leaps and bounds.

It is not that long ago that mortgages were virtually unheard of and unless you had cash you couldn’t really buy a property. The banks didn’t give loans and there was no such thing as an overdraft facility. This is not now the case.

Banks in Spain make money on the charges levied to the client and everyone should be aware of those unknown deductions made from your account. You should always check what they are for and that they are legitimate. The odd 10€ here and there may not matter but it does add up. The more worrying fact is that they usually come out without any warning.

For anyone opening a bank account you should check clearly what the costs involved are, what the on going costs are, what you will be charged for debit and credit card transactions and whether interest will be applied to the account.

It could be beneficial to check whether there are any high interest accounts that leave you access your money when ever you wish. There are some great deals around at the moment.

As with anything in Spain do not rely on what you are told ensure that you check the Spanish documents you will be asked to sign. You can get caught here just as you can with anything else in Spain. Don’t forget that in Spain if you sign a document you are deemed to understand it, whether or not you did !

Mortgages are somewhat difficult to come by at the moment but if you are looking for finance then shop around. There are banks who will lend at a reasonable rate and the time spent investigating this will be time well spent.

If you have property or a mortgage in Spain then you will probably know that the amount lent was based on the valuation of the property and not the purchase price. This method of lending has left many in difficulty.

However, the problem is now that the valuation companies are down valuing properties to such an extent that the banks won’t lend on a true purchase price.

There is still the difference between resident and non resident mortgages but a number of banks accept the fact that if you pay social security you are a resident.

Many banks are now offering equity release or re-mortgage. This is an excellent idea for those that have all their investment tied up in property. However, the criteria for qualifying for an Equity Release scheme is hard. Moreover there are some schemes around that really are not what they appear to be. So if you are thinking about Equity Release then stick with a high street bank. You should watch carefully for the small print and check exactly what is entailed.

So if you are looking at your current account, a mortgage or equity release shop around and find what suits you. And remember everything in Spain is negotiable including bank fees and charges !

CHILD ABDUCTION IN SPAIN

2009 hasn’t been the easiest of years for many on the Costa Blanca. Unfortunately, it has led to separation of couples many with children.

This has largely been because the pressures and lack of work have been too much for one or both.

For many the return to the UK where benefits and housing can be obtained has been the obvious choice. However there are problems.

Providing a child has been habitually resident in Spain for 12 months, if any mother returns to the UK without the consent of the father to remove the children from Spain then they are guilty of child abduction which is a criminal offence.

Many return oblivious to this and in all innocence.

However, the number of fathers taking action, which is quick, is increasing. There really is no defence to this action and the children are always returned to Spain, with or without their mother.

Basically a hearing takes place after the passports of the mother and children have been confiscated, an Order is usually made on the basis that the children will be returned to Spain, the flight will be booked and the mother and children escorted onto the plane. The Order usually has a clause that the father will undertake not to bring criminal proceedings against the mother upon her return to Spain.

In some instances custody is awarded to the father.

This leaves an innocent mother distraught at the loss of their child and probably without the financial means to return and live in Spain.

It is a frightening process and one which everyone should be aware of.

It is a question of Think before you Act!

As long as the father consents to the mother returning there is no abduction. This should be in writing.

For anyone in this situation considering leaving Spain then they should seek legal advice to ensure that their actions are legal.

Costa Blanca Lawyers are committed to helping families in distress and with the difficulties faced. If you need assistance then contact them at http://www.costablancalawyers.com/

DIVORCE IN SPAIN

So your year has been bad enough and you’re glad to see the back of 2009 and then bang goes your marriage!

OK it might have been hard for some time and perhaps living in Spain in the crisis of 2009 might not have been the easiest of times. Financial burdens add to an already struggling marriage and for some it is just too much.

January is notorious for being the month of separation, the stress of couples being together over the Christmas and New Year period is often enough to break an already fragile relationship.

Separation is no longer just a question of dividing the assets and moving on. The primary asset in any relationship is often the home. Due to the property slump it is difficult to sell and this leaves further financial burden with one party probably living in the property and the other effectively homeless or without the means to resolve their living accommodation.

If anyone tells you that the English Courts cannot deal with property in Spain – don´t believe them. It can and is in many divorces, providing that those that are dealing with the issue know what they are doing.

For anyone contemplating separation it is essential that they consider the implications of their actions. Be aware of your situation and entitlement. Please try where possible to resolve as many financial issues as possible.

Many seem under the illusion that because they live in Spain they must divorce here. Others believe that either one or both p arties should have an English address to divorce in England. These two beliefs are blatantly wrong and ill founded.

Understanding the cross border laws and what can and cannot be done is a specialist subject and should only be dealt with by those with experience in such issues. Whether you should divorce in Spain or England depends very much on your own personal situation. There are benefits to both systems but getting it wrong could prove costly.

One common thread to separation are the children, where they will live and what the law is in relation to parents being in different countries. Again advice is given in the hope that these issues can be resolved. Whilst EU law is clear, what is not are the practicalities of how it is actually implemented in different countries.

For a parent intending to return to their homeland they should consider their situation carefully before they do so. It might be child abduction which is a criminal offence and treated very seriously.

Many have fallen into the trap simply through lack of knowledge and the want to provide for their children in the safety of their homeland.

Both parents have a joint parental responsibility both financially and emotionally and the fact that they have separated does not dissipate that responsibility.

Both parents are entitled to contact with the children but they should remember that the needs of the children come before the wishes of the parents. However, with parents who are living in different countries then clearly a departure from the normal arrangements needs to be made to the extent that it is fair to all concerned.

On a final note it is not accepted that a mother says the father cannot see the children because he is not paying maintenance. Whilst this view is understandable it is for the Courts to ensure that the maintenance is paid not for the intervention of the mother.

For those worried about their situation, wishing to discuss separation and the consequences in a foreign country then assistance is close at hand. At Costa Blanca Lawyers our FIRST CONSULTATION IS FREE.

INHERITANCE TAX IN SPAIN

So you’ve got your Spanish Will. But what are the consequences of your actions. Did anyone explain Inheritance Tax in Spain to you? Probably not.

Sadly enough, it is a fact, that everybody must depart from this world at one time or another. Their assets, however, will remain. Those goods and assets that belonged to the deceased person at the time of his/her death form their inheritance.

For many it is only during a time of grief that the question of Inheritance Tax raises it’s head. And for some it is a great shock.

Fiscal Residents of the Communidad Valencia receive tax relief on Inheritance Tax. Unfortuntately, what constitutes a Fiscal Resident is often not appreciated and whilst many people have lived here for years and believe that they are a resident, they are not.

This leads to difficulties with Inheritance Tax.

A further problem is often the construction of the Will itself. Many couples are in a second relationship with children from a first and proper and adequate planning has often not been given as to how to deal with this. This again can have a significant bearing on Inheritance Tax, particularly for unmarried couples.

To consider each individual situation, you need to look at the value of the assets in Spain, the relationship between the deceased and the beneficiary and the net worth of the beneficiary. All these factors are taken into account to calculate Inheritance Tax.

For those who are not fiscally resident in Spain they should look carefully at their situation, and where appropriate ensure that they have sufficient funds set aside to pay Inheritance Tax in the event of their death.

A further important factor is that for many they ultimately leave their assets to their children who are usually not resident in Spain. They will have Inheritance Tax to pay because they will not benefit from the tax relief available to fiscal residents.

There is also the misconception that there is no inheritance tax because it is below the threshold. This view is based on the allowances in the UK which have absolutely no standing in Spain.

In certain circumstances there are no allowances for a beneficiary in others there is an allowance of just under 16000€ which, lets be honest is not much. So when faced with this situation there is the question of who inherits and to what extent their liability is to inheritance tax.

Whilst fiscal residents in the Valencia Region and their spouse/children who are also fiscally resident in the region do benefit from 95% tax relief, sadly is it not available for anyone who does not fall into that criteria such as a partner or non resident.

This is particularly relevant to those couples who are unmarried. Will or no Will there is no tax relief and the tax payable is at a much higher rate. Don’t forget that you can leave your assets to children from a previous relationship whilst protecting your partner.

Getting the right advice and working out what is best for you and your loved ones could save thousands. It doesn’t matter how many times we write on this topic there are still those that don’t listen and it is usually to their loved ones cost.

It is usual that children inherit on the death of the second parent, they having left their assets to each other in the first instance.

One problem for the Expat in Spain, is that there is an illusion that upon death the estate passes automatically to the Spouse.

This just isn’t right. Failure to make a Will causes unbelievable difficulties for the family left behind.

Getting the right advice and working out what is best for you and your loved ones could save thousands. It doesn’t matter how many times we write on this topic there are still those that don’t listen and it is usually to their loved ones cost.

Whether we like it or not the Spanish system is in place to keep assets within the bloodline. As a UK national, English law applies to your Spanish Will and you do have the democratic right to leave your assets to whoever you wish, but make sure you get it right.

If anyone just takes instructions from you without discussing your circumstances and/or inheritance tax and your beneficiaries exposure to it – BEWARE. You could be making a costly mistake.

Cross border laws and tax implications are complex and everyone is entitled to know their own position before making an informed choice.

For more information contact Costa Blanca Lawyers http://www.costablancalawyers.com/

SPANISH WILLS

It never really sinks in when people make a Will that the consequences of their actions may have a bearing on those they leave behind.

Many a time we see ill thought Wills, prepared by because the client said that that was what they wanted. Or in many instances the Will contains what they were told they had to do.

That’s all well and good but when your loved ones then find that they either do not inherit or they have a massive Inheritance Tax bill, the problems start. No consideration was given to what could be done and the consequences.

The main reason for this is the fact that the Spanish have compulsory heirship and only freedom of disposition of one third of their assets. Further, there is no understanding of the difference in English Law as against Spanish and what the English can do as against what the Spanish cannot.

Despite the number of times we have written about the subject of Wills people are still not listening and every week it is necessary to deal with those that have been bereaved and there is either no will, an English will with no English assets or they were told that they had to divide the estate in accordance with Spanish Law.
If you are English you have the democratic right to leave your assets to whoever you wish. Don’t let anyone tell you otherwise.

Spanish Wills should not be drawn simply on the basis of “this is what I want”. Any caring practitioner would take you through every element of the content of the Will, the consequences and liabilities.

Additional consideration must also be given to those in a second relationship with children from a previous relationship. This is particularly so when trying to protect not only your current partner but the children as well. There are ways and means to ensure that what you really want to happen does.

It should also be remembered that unmarried couples are particularly vulnerable when it comes to inheriting a partners assets. They are no relation and no matter how long you have lived together are not regarded as spouse.

So for those thinking of leaving their assets to their partner and then to all children between you – think again. Advice should be sought as to the amount of Inheritance Tax which would be payable both on the first death and then again on the second.

You should also bear in mind that anyone can change a Will at anytime. So if you pass away leaving everything to your partner and then to all the children between you there is nothing stopping them changing their Will to leave to their own children leaving your own devoid of the inheritance you thought they would receive.

Calculating Inheritance Tax takes into account a number of factors and it is not simply good enough to just take into account the value of the estate. You should look at how that value is calculated. Moreover residency status in Spain for the expat community is vital to the calculation and anyone considering making a Will should look closely at that situation too because it can save thousands in Inheritance Tax where appropriate.

For information on Inheritance Tax in the Valencian Region contact http://www.costablancalawyers.com