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Have you ever thought of retiring to Spain? Hundreds of thousands of foreigners have done just that and found a way of life which would simply not be possible in the UK or other north European countries. There's much to recommend it. A wonderful climate, a relaxed lifestyle and (in all areas except the far north of Spain) year round dining "al fresco" - the cheap wine and restaurants are enough to make it worth your while moving to Spain!

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click here to obtain free legal and taxation advice This could be the best move you've ever made. But one of the first things you must consider is your tax situation. Have you organised your investments and savings in a tax efficient manner? The basic rule of residence for tax is: if you spend more than 183 days in one calendar year in Spain you become liable for taxation, whether or not you make a formal application for a residence permit. Any temporary absence is not taken into account if it can be proved an individual is habitually resident for more than 183 days.

Seek independent advice as to the most practical way to avoid paying tax on your hard-earned savings. Find an independent financial adviser who will offer you a specialist tax planning service free of charge, evaluate your investment portfolio and discuss with you any changes that might be advisable in the light of your retirement to Spain. You'll also be able to discuss legitimate ways of minimising your capital gains tax on the disposal of your UK businesses and investments. There is a Double Taxation Treaty between Spain and the UK and because of this you will be able to become an ordinary resident for tax purposes from the day you arrive. Once you have obtained your resident's permit you will be able to cut your ties with the UK tax authorities and concentrate on making your tax returns in Spain.

An independent financial adviser will be able to advise you on banking and foreign currency matters, introduce you to local bank managers and assist you to open your new accounts. He or she will be able to see you safely through all the financial red tape involved in your move, including advising you on short or long term mortgages.

It's important to remember that Spanish tax rules apply to world income and world wealth (including property, paintings, yachts...!). You will be responsible for not only Income Tax but also Capital Gains Tax, Wealth Tax and Inheritance Tax. Tax on gifts is also applicable in Spain. It's easy to see why an element of professional planning is vital. Whether you consider creating an offshore Discretionary Trust, a Foundation or simply arrange an annuity, it's vital that you consider all the options before you make your move.

An important fact to consider when making your decision about which tax planning method to use is the possibility that you may - at some point - want or need to return to live in the UK. Although Spain is a paradise in which to live, one day for one of many reasons (family, poor health, homesickness) you may wish to return to your native land. The tax-planning vehicle that you consider should take that possibility into account. Many financial plans either ignore the precise circumstances and objectives of the individual or they get it wrong. For example, a common pitfall is that many individuals living in Spain do not think that they are resident in the eyes of the Tax Office. Often this is due to not understanding the cast iron rule that staying in Spain for 183 days in any calendar year automatically makes them tax resident.

You might consider becoming a "fiscal nomad" for one year prior to taking up residence in Spain. This is a useful way of legally avoiding capital gains tax and taking the opportunity to plan efficiently before taking up your Spanish residence. To enable you to do this efficiently, it is vital that you understand the precise tax rules in both the UK and Spain. Becoming a fiscal nomad is not normally a practical or long- term alternative, but it is possible in the short term whilst you put your future plans put into action.

Having decided upon the method of tax planning, now consider what you might do with your available capital. You might just leave it in the bank or building society…yet we all know that these institutions pay little and charge plenty! Why not consider investing your capital? It will take some time to come to terms with that thought, but with sound professional advice and guidance, it is possible to make secure investments which will generally give you a better income and gain you capital growth.

The question of investment is delicate and getting the right balance is important. Ask yourself the following questions:

• Will you need access to your funds on a regular basis?
• What time period will you feel safe with?
• What percentage of risk are you prepared to take?

These are just a few of the important issues to sort out in your own mind before making any decisions. Combine good tax planning with sound investment. Examine your exact requirements and judge which investment is better suited to you. It's important that you understand what investment is all about and it's a good idea to make sure your investment is managed and tracked in a professional manner.

A good financial adviser will have a proper system of reporting back to you so you are always fully abreast of what's happening to your own money. Examine the costs and charges - obviously these must be conducive to your return.

Give your financial adviser as much information as possible - about your current finances, your investment portfolio and plans and hopes for the future. He will then be able to make an informed appraisal, recommend possible adjustments to your portfolio and produce financial projections for you as well as arranging a mortgage or extra financing where necessary.