The general Spanish tax rule establishes that any person staying in our country for more than 182 days per calendar year, or having their center of vital interest in Spain, will be considered a tax resident in Spain, and will be subject to taxation for their worldwide income. Therefore, if you own a property in Spain or if you are the holder of a Golden Visa, you will not be considered a tax resident if you don’t exceed those days.
However, non-residents owning a property in Spain are subject to taxation, and the following taxes will be applicable:
IRNR (non-resident income tax return). Annual tax return, form 210
This tax is related to the fact of owning a property for private use. it is due on the 31st of December each year (to be paid along the next year) and for non-Europeans, it is usually calculated with a 24% rate and 19% for European, Norwegian and Icelandic citizens of the 1,1% of the cadastral value of the property (if this value has not been reviewed the 10 previous years, it will be calculated based on 2% of the cadastral value).
In case the taxpayer has not owned the property the whole year, the amount will be apportioned to the days he has owned the property.
Rental Tax. Quarterly tax return, form 210
If the property is rented out, non-residents should pay for the income received from the leases, calculated on the basis of 24% for non-European residents and 19% for European, Norwegian and Icelandic citizens. It should be paid on a quarterly basis, between the 1st and the 15th of April, July, October, and January each year.
European citizens and those from Norway and Iceland can deduct expenses from the income when related to the rental of the property (including mortgage interests), whilst non-European citizens cannot apply any deduction to the income received from the leases.
If the property has been leased for some periods but also used by the owner during other periods, the taxpayer should submit two different tax returns: one for their own use (IRNR) and another for the rental.
IBI tax (property tax)
This is a local tax that all owners (regardless of the tax residency) should pay between June and September each year, and it is also calculated on a basis of the cadastral value of the property. This is usually directly debited and paid to the municipality together with the rubbish collection fee.
Succession and donation tax
This is a tax to consider when owning a property in Spain, and it is highly recommendable to grant a Spanish will to avoid high expenses and paperwork to the heirs in the future.
Wealth Tax
It has to be paid in some cases for assets valued over 700,000 € (exempt below this value) and is calculated on the highest amount of one of three: the cadastral value, the purchase price, or the value established by the Tax Office, on a progressive scale of 0,2% to 2,5%, and some deductions might be applied.
The abovementioned taxes are related to the ownership of a property in Spain, but other income, e.g. from investments or earnings from equity, might also be taxed in Spain under certain circumstances.
Finally, all property owners need a Spanish NIF (tax code) in order to submit the tax returns. The NIF is the same number as the NIE number but registered in the tax office. And in the case of joint ownership, each owner is required to submit a separate tax return for each tax.
