Gavin Scott of the Algarve office of wealth-management consultant Blevins Franks said becoming tax resident in another country was something property owners needed to beware of as new problems linked to living abroad began to emerge. He said a new central database and “smart borders” system will be introduced to track the entry/exit movements of third-country nationals into the EU Schengen zone next year, ensuring how many days spent in a country will not go unnoticed by the tax authorities.
Mr Scott said: “Whereas people could buy property and come and go as they pleased, leaving tax residence issues until they’d ‘given it a go’, now they have to effectively make a commitment and decision at the outset.
“Although it is possible to reclaim tax if you end up paying in both countries, it will have a significant impact on cash flow and will be an expense for accountants to recover.”
The first post-Brexit 90-day visiting allowance within the Schengen area expired on April 1 and Brits without the correct residency permits who have been living in holiday homes since the beginning of the year have been told to get sort out their paperwork or consider returning to the UK.
Spain has denied threatening to deport British citizens who have made Spain their home without legalising their presence but the rush for residency papers during the pandemic and confusing Brexit rule changes mean some EU expats have been denied access to healthcare, jobs and bank accounts
Some expats fear their rights are being ignored by officials who are either overzealous in the application of the new rules or appear unaware of the guarantees laid down in the Brexit deal.
In some cases, computer systems have not been updated to reflect the changes in circumstances for expats, and there are also long delays in processing new documents required since Britain left the bloc last New Year’s Eve.
Expats living in Italy, France and Spain have all complained their lives are being made difficult by heavy-handed local authorities and slow-moving bureaucracy.
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The Italian government has launched a non-compulsory identity card in December called a carta di soggiorno, which has a code number and can be used for transactions but some applicants have been told the cards will not be ready until August.
There have also been problems for Britons living in France where jobs, university places and healthcare have all been refused because of bureaucratic hold-ups, according to a citizens’ rights group.
And Spain has been accused of exploiting Brexit red tape to make life difficult for the estimated 360,000 Brits who left the UK for a life in the sun.
Anyone wishing to become a resident will have to prove earnings of £2,000 a month plus £500 more for each dependent.
And UK driving licences are no longer valid indefinitely – requiring people to take a test in Spanish.
Campaigners said instead of waiving the rules and making life easier for the country’s UK expat community, Spain has stuck steadfastly to Brussels’ bureaucracy.
The former QC, who retired to Umbria, said the lack of paperwork meant some fellow expats had been unable to buy a house or cars and had national health cards renewal applications rejected.
He said: “People have been stopped by police who demand to see their permesso di soggiorno, which they don’t have.
“A British man in Puglia was told by an employer that his contract could not be renewed because the labour ministry’s computer would not accept his application without a document number.
“The British embassy has been working with the Italian government to increase awareness of our rights but it has been slow going.”