Buying guides
Date published:
Last updated:
By
Harrison Downes
*Researched and regularly updated to reflect current data.*
Owning property in Spain as a non-resident comes with ongoing tax obligations that apply whether or not you rent the property out. Spain taxes non-resident property owners on imputed income even if the property sits empty, charges annual property tax at the municipal level, and applies capital gains tax when you sell.
None of these taxes are particularly large for most properties, but they do need to be filed. Ignoring them creates penalties and complications that are entirely avoidable with basic awareness and a competent tax advisor.
This guide covers every tax obligation non-resident property owners face in Spain, including how each tax is calculated, when it's due, and how to stay compliant.
Focus on the mortgage - we handle the introduction →
At a glance
Non-resident owners pay annual taxes even if the property isn't rented out
Four main taxes apply: IRNR (income tax), IBI (property tax), Wealth Tax, and Capital Gains on sale
IRNR on an unrented property is typically a few hundred euros per year
IBI is Spain's equivalent of council tax, based on cadastral value
Wealth Tax applies to net Spanish assets exceeding 700,000 euros (threshold varies by region)
Capital Gains are taxed at 19% for non-residents when you sell
The buyer retains 3% of the sale price as a tax guarantee when you sell
EU/EEA residents receive more favourable treatment than non-EU residents on rental income tax
Filing is mandatory - non-compliance carries penalties
IRNR: non-resident income tax
The Impuesto sobre la Renta de No Residentes (IRNR) is the tax that catches most international property owners off guard. It applies in two different scenarios, and the calculation differs significantly depending on whether you rent the property out.
If you don't rent the property out
Even if your Spanish property generates zero rental income, you're required to pay IRNR on what's called "imputed income." The Spanish tax system assumes that owning a property provides an economic benefit (the ability to use it), and taxes that benefit annually.
The calculation:
Take the property's cadastral value (valor catastral), which is shown on your IBI receipt and is typically well below market value
Apply 1.1% if the cadastral value has been revised since 1994, or 2% if it hasn't been revised
Apply the tax rate: 19% for EU/EEA residents, 24% for non-EU residents
Worked example (EU/EEA resident): A property with a cadastral value of 200,000 euros (revised since 1994): 200,000 x 1.1% = 2,200 euros of imputed income. Tax at 19% = 418 euros per year.
Worked example (non-EU resident): Same property: 200,000 x 1.1% = 2,200 euros. Tax at 24% = 528 euros per year.
For most properties in the 300,000-800,000 euro market value range, the annual imputed income tax works out to roughly 200-700 euros. It's not a large amount, but it must be filed.
Filing: Form 210, filed annually. The deadline is December 31 of the year following the tax year (so 2025 imputed income is due by December 31, 2026). Your lawyer, gestor fiscal, or tax advisor can file this on your behalf.
If you rent the property out
Rental income from Spanish property is taxable under IRNR, and the rules differ significantly between EU/EEA residents and non-EU residents.
EU/EEA residents pay 19% tax on net rental income. "Net" means you can deduct allowable expenses from your gross rental income before calculating the tax. Deductible expenses include mortgage interest, property management fees, repairs and maintenance, insurance premiums, IBI, community fees, utility bills (if you pay them as landlord), cleaning costs, and depreciation of the property (typically 3% of the construction value per year, excluding land value).
Non-EU residents (including UK residents post-Brexit and US residents) pay 24% tax on gross rental income. "Gross" means no expense deductions are allowed unless a double taxation treaty between Spain and your home country provides for deductions. The UK-Spain double taxation treaty may provide some relief, but the default position is significantly less favourable than for EU residents.
This difference is substantial. An EU resident with 20,000 euros of gross rental income and 8,000 euros of deductible expenses pays 19% on 12,000 = 2,280 euros. A non-EU resident with the same income pays 24% on 20,000 = 4,800 euros. That's more than double.
Filing: Form 210, filed quarterly during periods when rental income is received. Quarters end March 31, June 30, September 30, and December 31, with filing due within 20 days of each quarter end. For periods when the property is not rented, the imputed income rules apply instead.
The interaction between rented and unrented periods
If you rent your property for part of the year and use it yourself (or leave it empty) for the rest, both rules apply to their respective periods. Rental income is declared for the rented months. Imputed income is calculated on a pro-rata basis for the remaining months. Both are filed on Form 210.
IBI: annual property tax
The Impuesto sobre Bienes Inmuebles (IBI) is Spain's annual property tax, broadly equivalent to council tax in the UK or property tax in the US. It's charged by the municipality where the property is located and is based on the property's cadastral value.
Cadastral values are set by the Catastro (Spain's property valuation office) and are typically well below market value - often 30-50% of what the property would sell for, though the ratio varies by municipality and when the last revaluation occurred. Some municipalities are currently undergoing revaluations that are bringing cadastral values closer to market values, which will increase IBI bills.
How much to expect: IBI rates are set by each municipality within a band defined by law. The typical range for residential properties is 0.4-1.1% of cadastral value. For most apartments and villas in popular international buyer areas, annual IBI falls between 400 and 1,500 euros. Higher-value properties in municipalities with elevated rates can pay more.
When it's due: IBI is billed annually, typically between September and November depending on the municipality. Most owners set up a direct debit (domiciliacion bancaria) from their Spanish bank account to ensure it's paid automatically.
Important note: When you buy a property, IBI for the year of purchase is typically divided between buyer and seller pro-rata based on the completion date. Your lawyer should ensure this is addressed in the purchase process.
Wealth Tax
Spain's Wealth Tax (Impuesto sobre el Patrimonio) is a tax on net assets. For non-residents, only assets located in Spain are counted - your worldwide wealth is not relevant.
General threshold: 700,000 euros in net Spanish assets. Below this threshold, no Wealth Tax is due. Above it, progressive rates apply ranging from 0.2% to 3.5% on the excess.
Regional variation: Wealth Tax rates and thresholds are set by each Comunidad Autonoma. Madrid has historically offered a full 100% exemption (effectively zero Wealth Tax), though this has been politically contested and may change. Other popular buyer regions like Andalucia, Catalonia, and the Balearic Islands apply the tax at standard or elevated rates.
For non-residents specifically: The key question is which region's rules apply. Non-residents are generally subject to the national rules (without regional exemptions like Madrid's), though the specifics can depend on where the property is located and how the tax is administered. This is an area where professional tax advice is particularly valuable.
Solidarity Tax on Large Fortunes: Introduced in 2022, this additional tax applies to net assets exceeding 3,000,000 euros at rates of 1.7-3.5%. It was designed to override regional exemptions (like Madrid's Wealth Tax exemption) and applies regardless of which region the assets are in. For most non-resident buyers in the 500,000-1,500,000 euro property range, this tax won't apply. It becomes relevant for high-net-worth buyers with multiple Spanish assets.
Filing: Form 714, filed annually during Spain's income tax filing period (April-June). Only required if your net Spanish assets exceed the threshold.
Capital Gains Tax on sale
When you sell your Spanish property, any profit is subject to Capital Gains Tax. For non-residents, the rate is a flat 19% on the gain regardless of how long you've held the property.
How the gain is calculated: Sale price minus purchase price minus allowable costs. Allowable costs include the original purchase taxes (ITP or IVA + AJD), notary and registry fees, legal fees, and the cost of any improvements (not maintenance) made to the property during ownership. Keeping receipts and records of property improvements throughout your ownership period is important - these directly reduce your taxable gain when you sell.
The 3% retention: When a non-resident sells property in Spain, the buyer is legally required to withhold 3% of the sale price and pay it directly to the Spanish tax authority (Agencia Tributaria) within 30 days. This acts as an advance payment against the seller's Capital Gains Tax liability.
If the 3% retention exceeds your actual tax liability (i.e., the gain was smaller than the retention implies), you file for a refund. If the actual tax exceeds the 3% retention, you pay the difference. The refund process can take several months.
Worked example: You bought for 400,000 euros with 45,000 euros in buying costs. You sell for 550,000 euros. Gain = 550,000 - 400,000 - 45,000 = 105,000 euros. Tax at 19% = 19,950 euros. The buyer retains 3% of 550,000 = 16,500 euros. You owe an additional 3,450 euros (19,950 - 16,500).
Interaction with home-country tax: Most countries tax their residents on worldwide capital gains. Double taxation treaties generally allow you to credit the Spanish tax against your home-country liability, preventing you from being taxed twice on the same gain. The UK-Spain and US-Spain treaties both contain provisions for this. Your home-country accountant should coordinate with your Spanish tax advisor to ensure the credit is properly applied.
How to stay compliant
Non-resident tax compliance in Spain is straightforward if you set it up properly from the start.
Appoint a fiscal representative. Non-EU residents are legally required to appoint a fiscal representative (representante fiscal) in Spain - a person or entity authorised to deal with the tax authority on your behalf. EU/EEA residents aren't legally required to have one but it's strongly recommended. Your Spanish lawyer or a specialised tax advisor (gestor fiscal or asesor fiscal) can serve in this role.
Use a Spanish tax advisor familiar with non-resident obligations. The annual filing requirements are not complex, but they're unfamiliar to most international property owners. A gestor fiscal who handles non-resident property tax on a regular basis will typically charge 100-300 euros per year for the annual IRNR filing and IBI management. This is a small cost for the peace of mind that your obligations are being met.
Set up direct debits for IBI. Automating IBI payment through your Spanish bank account prevents missed deadlines.
File IRNR every year, even with no rental income. The imputed income obligation applies regardless. Non-filing doesn't go unnoticed indefinitely - the tax authority cross-references property ownership records with tax filings.
Keep records of all property-related expenses. Repair invoices, improvement costs, management fees, insurance premiums, and mortgage interest statements should all be retained. These are deductible against rental income (for EU residents) and reduce your taxable gain on sale.
Coordinate with your home-country accountant. Spanish property ownership creates reporting obligations in most home countries. UK buyers must declare rental income on their self-assessment. US buyers have FBAR and FATCA obligations. Ensure your home-country accountant is aware of your Spanish property and coordinates with your Spanish tax advisor to avoid double taxation or missed filings.
Frequently asked questions
Do I have to pay tax in Spain if I don't rent my property out?
Yes. Non-resident property owners pay annual imputed income tax (IRNR) even on unoccupied properties. The amount is small - typically a few hundred euros per year - but filing is mandatory.
What's the difference between EU and non-EU tax treatment?
EU/EEA residents pay 19% on net rental income (after deducting expenses). Non-EU residents pay 24% on gross rental income (no expense deductions unless a tax treaty provides otherwise). On imputed income for unrented properties, the rates are 19% and 24% respectively but the base amount is the same.
Will I be taxed twice - in Spain and my home country?
Double taxation treaties between Spain and most major countries (including the UK and US) prevent full double taxation. You can generally credit Spanish taxes paid against your home-country tax liability on the same income. However, coordination between your Spanish and home-country tax advisors is important to ensure the credits are properly applied.
What happens if I don't file my Spanish taxes?
Non-filing carries surcharges and penalties. Late filing within 12 months incurs surcharges of 5-20% depending on how late. Beyond 12 months, additional interest and penalties apply. The tax authority can also assess taxes based on their own calculations if you don't file, which may not be in your favour.
Do I need a tax advisor, or can I file myself?
You can technically file yourself using the Agencia Tributaria's online portal, but the forms are in Spanish and the system is designed for people familiar with the Spanish tax framework. For 100-300 euros per year, a gestor fiscal handles everything, ensuring accuracy and timeliness. For most non-resident property owners, this is well worth the cost.
How is cadastral value different from market value?
Cadastral value is an administrative valuation set by the Catastro and is typically 30-50% of a property's market value. It's used as the basis for IBI and imputed income calculations. You can find your property's cadastral value on your IBI receipt or through the Catastro's online portal.
Next steps
Tax obligations are an important part of the ownership picture, but they shouldn't overshadow the bigger decisions - like which property to buy and how to finance it. For the complete buying cost breakdown including one-time and ongoing expenses, see our full cost guide.
If you're at the stage of considering a purchase, our free pre-check gives you a clear picture of your mortgage options within 48 hours.
For the full buying and mortgage process, see our complete guide to getting a mortgage in Spain as a non-resident.
Questions? WhatsApp us or get in touch.
This content is for informational purposes only and does not constitute tax advice. Zerodown is a mortgage introducer, not a tax advisor. Tax rates, thresholds, and filing requirements can change. Always consult a qualified Spanish tax professional (gestor fiscal or asesor fiscal) for advice specific to your situation.
