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Transferring a UK Pension When Living in Spain
Understanding SIPPs Spain Flag

For UK expats living in Spain, transferring pensions to an International SIPP can offer greater flexibility, control, and investment options. This guide explains how SIPPs work, who can transfer, the benefits for Spanish residents, and key considerations to make the most of your pension.

What is an International SIPP?

For many expats, an International SIPP is the best balance between cost, flexibility, and control.

A UK-regulated personal pension designed for non-UK residents, typically accessible only through a financial adviser.

Who Can Transfer?

  • Anyone with preserved UK pensions (workplace or personal).
  • Contributions require UK-relevant earnings, but transfers do not.
  • DB schemes may require financial advice if CETV > £30,000.
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Downsides of Keeping Pensions in the UK

Taxation

The 25% Pension Commencement Lump Sum (PCLS) is tax-free in the UK but fully taxable in Spain. However, using an NT code allows drawdown income to be paid gross and taxed only in Spain.

Flexibility

From age 55, you can take lump sums or phased drawdowns, with the option to withdraw 100% of your pension if desired.

Investment choice

You have access to global funds, ETFs, and other investments, allowing a fully customisable strategy aligned with your Spanish residency.

Currency management

Income and holdings can be maintained in GBP, EUR, or USD, helping to reduce foreign exchange risk compared to a UK-only pension in sterling.

Things to watch out for:  SIPPs remain under UK jurisdiction, meaning inheritance tax will apply from 2027. Costs can vary widely between providers, so it’s important to compare charges, and local Spanish tax rules may make lump-sum withdrawals expensive.

Taxation of UK Pensions in Spain

Understanding how your UK pension is taxed in Spain is essential for effective financial planning. Spanish residents are generally taxed on worldwide income, including private and occupational pensions, while UK government pensions may remain taxable in the UK.

For the latest information on Spanish income tax rates, wealth tax, and double-taxation rules, explore our full guide below.

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Why Expert Guidance Matters for Pension Transfers

Managing pension taxation in Spain can be complex and often requires specialist advice to ensure you comply with local rules while optimising your income. Transferring your UK pension is a big decision with lasting consequences. Whether you’re thinking about a SIPP, a QROPS, or leaving it where it is, make sure you understand the pros, cons, costs, and tax implications. Professional, independent advice is essential to ensure your retirement savings work best for you, wherever you choose to live.

What does the obligation free call include?

An initial 15-minute introduction call explaining our services and how we can help.

We go through a fact-finding exercise so we can then provide a full financial planning report including a personalised retirement forecast with future projections and work out how on track you are.

Lastly, we will provide a recommendation on any areas where we feel you could improve.

Who is SJB Global and meet your adviser

Our regulations, Independence and Fees

Our process from start to finish

Area we help with including:

UK Pension Advice

Retirement Planning

Investment Planning

Tax Planning

US Expat Services

International Estate Planning

Note: Minimum managed assets for SJB Global is £100,000 or currency equivalent.

Licensing & Regulations

Nexus Global specialises in providing a regulatory platform and compliance support to international financial advisers and intermediaries to enable them to meet regulatory requirements to provide their clients with a professional service. The financial advisers trading under SJB Global are members of Nexus Global. Nexus Global is a division of Blacktower Financial Management (International) Limited (BFMI). All approved members of Nexus Global are appointed representatives of BFMI. BFMI is licensed and regulated by the Gibraltar Financial Services Commission (FSC) and bound by the rules under licence number 3647: http://www.fsc.gi/regulated-entity/blacktower-financial-management-international-limited-3647.

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