Retirees

Thousands of pensioners in Spain could stop paying several taxes after turning 65

Published

14 mins ago

May 15, 2026

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Some pensioners in Spain may no longer need to pay certain taxes after reaching the age of 65.
Credit : Ground Picture, Shutterstock

Many people in Spain assume retirement simply means leaving work behind and living on a pension. But reaching the age of 65 can also unlock several tax advantages that many retirees either overlook or discover far too late.

From selling a home without paying capital gains tax to possible refunds linked to old pension contributions, Spanish tax rules offer a series of financial benefits that could save pensioners thousands of euros. And with the current tax season now underway, financial advisers say growing numbers of retirees are starting to realise they may not owe as much to Hacienda as they once thought.

Some pensioners may even be entitled to recover money they paid in taxes decades ago.

At a time when food prices, electricity bills and housing costs remain a concern for many older residents, these exemptions are becoming increasingly important for households trying to make retirement income stretch further.

Selling your home after 65 could save you thousands in tax

One of the biggest tax advantages available in Spain begins the moment someone over 65 decides to sell their main residence.

Under Spanish tax law, pensioners who sell the home they normally live in can avoid paying capital gains tax on the profit from the sale, as long as the property has been their habitual residence for at least three years.

That exemption can make an enormous difference financially, especially after years of rising property values across many parts of Spain.

Normally, homeowners who sell a property at a profit may have to hand over between 19 and 28 per cent of those gains through IRPF, Spain’s income tax system. But retirees over 65 selling their primary residence are exempt from that payment entirely.

What makes the rule particularly attractive is that pensioners are not required to buy another property afterwards in order to keep the exemption.

For many older residents, that creates far more flexibility later in life. Some choose to move closer to children or grandchildren. Others downsize after retirement or relocate to cheaper areas where living costs are lower.

Without the tax exemption, those decisions could become much more expensive.

Financial specialists say many retirees remain unaware of this rule until they begin speaking to notaries or tax advisers during the sale process.

Spain also offers tax advantages on second homes and investments

The benefits do not only apply to someone’s main residence. Spanish rules also allow people over 65 to avoid paying capital gains tax on profits from selling other assets, including second homes, shares or investment products, under certain conditions.

To qualify, the money earned from the sale must be reinvested into what Spain calls a “renta vitalicia”, a lifetime annuity designed to provide long term retirement income.

There is a limit attached to the measure. The exemption only applies up to a maximum reinvestment of €240,000.

Still, financial advisers say the system has become increasingly popular among retirees looking for stability and predictable monthly income during retirement.

The idea behind the measure is relatively simple. Instead of heavily taxing older residents after they sell assets accumulated during their working lives, the government encourages them to convert part of that money into guaranteed retirement income.

For pensioners concerned about financial security later in life, especially during periods of inflation or economic uncertainty, that option can become particularly attractive.

Some retired workers may also receive tax refunds from Hacienda

Another major issue during this year’s tax campaign affects former ‘mutualistas’, workers who contributed to older mutual pension systems before Spain’s current social security structure became fully established.

This mainly includes people who worked before 1978 in sectors such as banking, construction, education, fishing, shipyards, public administration, electricity companies and heavy industry.

According to Spain’s Tax Agency, some of these pensioners may now be entitled to partial tax refunds linked to pension contributions made decades ago. The issue stems from the way certain contributions were taxed historically.

Eligible retirees may benefit from a 25 per cent reduction on the part of their pension connected to those earlier contributions.

Spanish authorities previously estimated that affected pensioners received average refunds of around €2,686.

For many retirees living on fixed incomes, that money has arrived as a welcome financial boost during a period marked by rising prices across Spain. The current income tax campaign remains open until 30 June for online submissions.

Not every pensioner in Spain needs to file a tax return

Another area that continues to confuse many retirees is whether they actually need to submit an annual tax declaration at all.

Under current rules, pensioners receiving less than €22,000 per year from a single payer generally do not need to file a tax return.

But the situation changes once multiple payers become involved. Retirees earning more than €16,876 annually from two payers may still need to file if the second payer contributes at least €1,500 per year.

That often affects pensioners receiving foreign pensions, widow’s pensions or other supplementary retirement income.

Private pension plans can also change the situation depending on how much money is withdrawn.

Tax advisers regularly warn that many pensioners wrongly assume retirement income automatically exempts them from filing obligations.

In reality, every financial situation is different, especially for retirees receiving income from abroad or combining several pensions.

As Spain’s population continues to age, financial experts believe awareness around these tax benefits will become increasingly important. For many pensioners, understanding the rules properly could mean the difference between paying unnecessary taxes and keeping more money available for everyday life during retirement.

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Best Countries To Retire Abroad In 2026

Published

3 days ago

May 11, 2026

Farah Mokrani

More retirees are looking abroad in 2026 as living costs continue rising at home. Credit : Olena Yakobchuk, Shutterstock

More retirees are looking beyond their home country in 2026 and not only because of the weather. Rising living costs, expensive housing and pressure on healthcare systems are pushing many people to seriously consider retirement abroad for the first time. And according to the latest Global Retirement Index 2026, some of the countries attracting the most attention are not always the ones people expect.

The annual ranking, based on factors including healthcare, cost of living, residency visas, climate, housing and everyday quality of life, suggests it is still possible to enjoy a comfortable retirement without spending a fortune. In several destinations, retirees are managing to live well on budgets that would feel far tighter elsewhere in Europe or North America.

What is changing in 2026 is that retiring abroad no longer feels like a niche dream for adventurous expats. For many people, it is becoming a practical financial decision. And while countries such as Spain and Portugal continue to perform strongly, the number one destination this year is Greece.

Why Greece has become the surprise favourite for retirees

Greece climbed to the top of the 2026 ranking after previously sitting much lower in recent years. For many retirees, the appeal is easy to understand once the numbers are examined more closely.

The country offers more than 300 days of sunshine a year, relatively affordable housing in many coastal areas and a slower pace of life that continues attracting foreign residents looking to escape stress and rising costs elsewhere.

According to the report, a couple can still live comfortably in Greece on roughly €2,900 to €3,000 per month depending on the area and lifestyle.

In some coastal towns and islands, sea view homes continue to rent for between €600 and €1,000 per month, although prices have risen noticeably in recent years due to increased foreign demand and tourism investment.

Healthcare also remains relatively accessible compared with many other countries. Private insurance for couples can cost around €250 per month according to the study. But beyond finances, many retirees say daily life itself is one of the biggest attractions.

The relaxed lifestyle, slower rhythm and outdoor culture continue drawing people who feel increasingly exhausted by the pace and pressure of life in larger cities elsewhere.

Spain, Portugal and Italy still remain among the strongest choices

Although Greece took first place, southern Europe continues dominating the retirement rankings overall.

Spain remains one of the most attractive options for retirees wanting good healthcare, strong infrastructure and warm weather within Europe.

Despite rising housing prices in parts of the country, Spain still offers a lifestyle many retirees struggle to find elsewhere.

In cities such as Málaga, renting a flat near the coast may cost between €1,000 and €1,300 per month. According to the report, overall monthly living costs for one person often range between €1,800 and €2,300 depending on lifestyle.

Spain’s healthcare system also remains one of the strongest points repeatedly highlighted by expats.

Private health insurance policies can still start from relatively affordable monthly prices, especially compared with countries where medical costs are significantly higher.

Portugal also continues attracting retirees despite its rapidly increasing property market.

The country remains especially popular among foreign residents thanks to its climate, safety, healthcare system and residency visa options such as the D7 visa.

However, the report notes that housing prices near Lisbon and other high demand areas have risen sharply compared with only a few years ago.

Italy also performed strongly in the ranking, particularly southern regions such as Sicily.

According to the report, some smaller towns still offer surprisingly affordable housing while daily expenses remain lower than many people expect. For retirees searching for sunshine, food culture and a slower lifestyle without leaving Europe entirely, Italy continues holding strong appeal.

Asia and Latin America are attracting retirees looking for lower costs

Outside Europe, several countries continue standing out because of how far retirement income can stretch.

Malaysia ranked highly once again, particularly for retirees wanting modern infrastructure alongside lower living costs.

The report estimates that a couple can live comfortably there for around $2,200 per month including housing, food, leisure activities and travel.

Thailand also remains one of the most affordable retirement destinations in the world according to the ranking.

Some retirees are reportedly living comfortably on around $1,200 per month, while couples with larger budgets can enjoy an even higher standard of living.

Low housing costs, inexpensive healthcare and well established retirement visa options continue making Thailand especially attractive for foreign retirees.

In Latin America, Panama, Mexico and Costa Rica all performed strongly.

Panama continues drawing attention because of its Pensionado programme, which offers discounts for retirees on everything from transport and entertainment to healthcare and utility bills.

Mexico also remains one of the best value destinations overall according to the report.

The study suggests that comfortable living is possible there from roughly $1,200 per month depending on the location, while retirees with larger budgets can enjoy a particularly high quality of life.

Costa Rica meanwhile continues attracting retirees searching for nature, warm weather and more relaxed living conditions.

Why more people are seriously considering retirement abroad

One of the clearest messages emerging from the 2026 ranking is that retirement abroad is increasingly being viewed as a realistic option rather than an unrealistic fantasy.

For many people approaching retirement age, the decision is becoming less about chasing luxury and more about maintaining quality of life without financial pressure.

Housing costs, healthcare access, climate and day to day expenses now play a much bigger role in retirement planning than they did a decade ago.

And in several of the countries highlighted in the report, retirees say they feel they can enjoy a calmer and more comfortable lifestyle for less money than they would spend staying at home. That is one reason international retirement is no longer only attracting wealthy pensioners.

In 2026, it is becoming part of a much wider conversation about affordability, wellbeing and how people actually want to spend the next stage of their lives.

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Spain Pension Error: Thousands Owed Back

Published

2 weeks ago

April 28, 2026

Farah Mokrani

spain-pension-error:-thousands-owed-back

Some Spain retirees could receive back payments after pension mistake Credit : Mehaniq, Shutterstock

Thousands of retirees in Spain could be owed money after Social Security admitted an error in some 2026 early retirement pension calculations. People who chose voluntary early retirement this year and were close to the maximum pension level may have had larger reductions applied than the law allows. Now the system is reviewing cases and returning money, with some pensioners expected to receive significant back payments.

For many older households, that could mean badly needed relief at a time when everyday costs remain high.

The mistake affects people who believed their pension had been calculated correctly when they retired. Instead, some were given lower monthly payments than they should have received.

Now the administration has begun putting that right.

Who may be entitled to money back

The reported problem mainly concerns people who:

Took voluntary early retirement in 2026
Receive pensions near the upper pension limit
Had reduction coefficients applied to their pension

Spain allows workers to retire before the standard age if they meet contribution requirements. In return, monthly pension payments are reduced.

Those reductions are not random. They are based on years paid into the system and how early the person retires.

That is why accuracy matters. If the wrong coefficient is used, the pension can be lower every single month. And over time, even a modest difference can add up quickly.

What went wrong

The issue relates to the pension reform introduced under Law 21/2021. That reform created a transition period running from 2024 to 2033. During those years, some workers taking early retirement, especially those close to the maximum pension, should benefit from softer reductions than those planned later.

According to reports in Spain, those transitional rules were not properly applied in some pensions granted during the first months of 2026.

Instead, stronger reductions appear to have been used. In simple terms, some retirees were penalised more than they should have been. That meant lower monthly income from the moment retirement began.

How Social Security is correcting it

The good news for affected pensioners is that Social Security is reportedly reviewing many files automatically. That means some retirees may not need to file a formal complaint to receive the correction.

Where the error is confirmed, pensions should be recalculated and arrears paid. Spanish reports say the refunds are being applied retroactively, so money wrongly withheld should be returned for the relevant months already passed.

Future monthly payments should also rise once the correct amount is in place. For pensioners, that may matter even more than the one off repayment.

A higher pension every month can make household budgeting easier going forward.

How much could people receive

There is no universal figure because each pension is different.

The amount depends on:

The pension level
How many months were affected
How early retirement was taken
The reduction rate wrongly used

Some retirees may receive a modest adjustment.

Others, especially those with pensions close to the upper threshold, could receive thousands of euros once missed payments are added together.

That is why the story has drawn so much attention.

For many retired people, a correction like that is not a technical detail. It is real money that can help with rent, food, electricity or family support.

What retirees should do now

Even if reviews are automatic, it is wise to stay alert. Anyone who took voluntary early retirement in 2026 should check:

Their pension decision letter
The monthly amount currently received
Any new messages from Social Security

Any recalculation notice

If figures seem unclear, asking for clarification can be sensible.

Many families already help parents or grandparents manage digital notifications, and this may be one of those moments where a second pair of eyes helps.

Why this matters so much

People often assume pension mistakes are small and quickly fixed.

That is not always true.

Many retirees live on fixed monthly incomes. They plan carefully. Bills arrive on time whether the pension calculation is right or wrong.

So if someone receives less than expected for several months, the effect can be immediate.

Savings may be used.

Spending may be cut.

Stress can build quietly.

That is why trust in the pension system matters. People need confidence that after decades of contributions, the final calculation will be correct.

Voluntary early retirement explained

Spain offers more than one early retirement route.

Voluntary early retirement usually allows people to retire up to two years before the standard age, provided they meet contribution conditions.

There is also involuntary early retirement, generally linked to job loss or forced exit from work, with different rules.

The current issue concerns the voluntary route, not all pensioners in Spain.

That distinction is important because many people may hear the headline and assume every retiree is affected.

They are not.

A lesson for future retirees

Anyone planning retirement in the coming years should keep copies of estimates, official letters and final calculations. Spain’s pension rules have changed several times and transition periods can be complicated.

Checking the final figures carefully is always worthwhile. It may feel tedious at the time, but it can prevent problems later.

A welcome correction for many households

For those affected, the main message is straightforward. The error has been identified. Payments are being reviewed and money should be returned where too much was deducted.

At a time when many pensioners feel every euro matters, that refund may arrive as very welcome news.