Forget Spain, here’s where to move to cut your tax bill – and receive a warm welcome

British people have long had a love affair with Spain. But last week, the Spanish government threatened to shatter this relationship.

Prime minister Pedro Sanchez’s plans to impose a 100pc tax on property purchases by non-resident buyers living outside the EU would effectively ban the biggest national group of buyers in Spain – the British.

The Left-wing leader has also this week gone further and suggested Spain could ban anyone from outside the EU from buying properties.

The proposals may never happen, but it has caused uncertainty and spooked prospective buyers. A solicitor in Valencia had buyers drop out of a property purchase last week, while an agent on the Costa del Sol reported that four potential British buyers and a South African had cancelled their flights out to Spain to view properties.

It’s clear that the Spanish government wants to deter British people. So where else should holiday home buyers look for lower tax rates, easier visa access – or just a warmer welcome?

For people moving abroad or buying a holiday home, seeking out a tax haven may not traditionally be top of the list. But since the tax rises in last October’s Budget, cutting your tax bill has become a bigger consideration, says Stuart Wakeling, of Henley & Partners, a migration adviser.

While Portugal, Greece, Cyprus and Italy have had a “steady flow” of interest among British buyers, he says, over the past few months, the United Arab Emirates has become the top choice – and its appeal is widening.

He adds: “Typically we were dealing with the very wealthy, but now we are seeing applicants with a much lower net worth selling up in the UK and using those funds to buy real estate in Dubai instead.”

There is zero income tax in the UAE, and the dynamic English-speaking business-friendly economy encourages many foreign workers to move there for the opportunities as well as a city-beach lifestyle.

If you spend at least 183 days in a year there, there are no UAE taxes on your assets outside the country, and setting up a company is “easy and efficient” according to Henley & Partners.

The country offers golden visas, requiring investment of AED 2m (£444,406) but also other long-term residence options. Alternatively, you can set up a company with AED 5,000 (£1,109) for a two-year residence permit.

Cyprus and Malta also offer low tax rates. Non-domiciled residents of Cyprus are exempt from tax on dividends and interest, there are no inheritance, wealth or gift taxes and there is no capital gains tax on property sold outside the island, according to KPMG.