The purchase of homes in Spain by foreign buyers continues to grow. For anyone buying property without becoming a Spanish tax resident, it is important to understand which taxes apply, how to comply with your obligations and the ongoing costs of owning a home in Spain.
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To help clarify the rules, here are the most common questions about taxation for non-residents who own property in Spain.
Taxes on buying a property as a non-resident
Non-resident property buyers in Spain, whether foreign nationals or Spanish citizens living abroad, are subject to the same purchase taxes as resident buyers.
- VAT (IVA) or Property Transfer Tax (ITP), depending on whether the property is new-build or resale.
- Stamp Duty (AJD), where applicable.
Take note of the taxes you must pay when buying a home in Spain.
Taxes on selling a property as a non-resident
Selling a property in Spain may trigger several tax obligations:
- The seller must declare any capital gain or loss through the Non-Resident Income Tax (IRNR). The applicable tax rate is:
- 19% for EU and EEA residents
- 24% for non-EU residents
Taxpayers who are resident in another EU Member State, Iceland, Norway or Liechtenstein may qualify for an exemption on gains reinvested in a main residence, provided the full proceeds of the sale are reinvested.
- Another relevant tax is the Tax on the Increase in Value of Urban Land, commonly known as the municipal capital gains tax. Under Spanish local finance legislation, when the seller is a non-resident, the buyer becomes responsible for paying this tax initially. However, the buyer may subsequently claim reimbursement from the non-resident seller. To avoid disputes, it is advisable to specify responsibility for this cost in the deed of sale.
Taxes on rental housing for non-residents
Current regulations require non-residents who rent out property in Spain to declare rental income through the Non-Resident Income Tax (IRNR) and pay the corresponding tax.
There are important differences depending on where the owner resides:
- Residents of EU and EEA countries. These taxpayers may deduct eligible expenses related to the rental activity, such as mortgage interest, maintenance costs and other deductible expenses allowed under Spanish tax rules. The applicable tax rate is 19%.
- Non-EU residents. Property owners resident in third countries are currently unable to deduct expenses and are taxed on the gross rental income at a rate of 24%.
This distinction may change in the future. In July 2025, Spain's National Court ruled that non-EU residents should also be allowed to deduct expenses necessary to generate rental income. However, the ruling is not yet final, and a decision from the Supreme Court is still pending.
You should also bear in mind the following situations:
- Partial rental. If the property is rented out for only part of the year, rental income must be declared for the rental period. For the remainder of the year, owners must declare the proportional share of imputed income based on the property's cadastral value (1.1% or, where applicable, 2%).
- Economic activity. If the owner employs at least one full-time employee in Spain to manage the rental business, the activity may be considered a business activity carried out through a permanent establishment and taxed under the rules applicable to income from economic activities.
Other taxes affecting non-resident home-owners in Spain
Non-residents who own property in Spain may also be liable for the following taxes:
- Property Tax (IBI): This municipal tax is paid annually by property owners. It is calculated using the cadastral value of the property and the rate established by the local council.
- Non-Resident Income Tax (IRNR): Non-resident owners may be liable for this tax when income is generated through the property, or through the imputed income rules if the property is not rented out.
- Wealth Tax (IP): This tax is levied on the net worth of individuals, that is, all the assets and rights of economic value that they own. Non-residents are subject to this tax on their own account, and they must file Form 210, if applicable. This means that only assets located in Spain will be considered when determining each person's net worth. Similarly, only charges and encumbrances affecting assets and rights located in Spain, or that can be exercised or must be fulfilled in Spain, will be deductible.
There is a minimum exemption of €700,000 for Wealth Tax, applicable to non-residents subject to a real obligation to contribute.
As regards the Wealth Tax rate for non-residents, it ranges from 0.2% to 3.5%, depending on the value of the taxable assets.
Taxable base | Tax due | Remaining taxable base | Applicable rate |
|---|---|---|---|
Up to €0 | €0 | Up to €167,129.45 | 0.2% |
Up to €167,129.45 | €334.26 | Up to €167,123.43 | 0.3% |
Up to €334,252.88 | €835.63 | Up to €334,246.87 | 0.5% |
Up to €668,499.75 | €2,506.86 | Up to €668,499.76 | 0.9% |
Up to €1,336,999.51 | €8,523.36 | Up to €1,336,999.50 | 1.3% |
Up to €2,673,999.01 | €25,904.35 | Up to €2,673,999.02 | 1.7% |
Up to €5,347,998.03 | €71,362.33 | Up to €5,347,998.03 | 2.1% |
Up to €10,695,996.06 | €183,670.29 | Above €5,347,998.03 | 3.5% |
Do you have to pay tax on an empty property in Spain?
Yes. Non-resident owners must declare imputed property income when a property is used solely for personal purposes or remains empty.
In these cases, taxable income is calculated as:
- 19% for residents of the EU, Iceland, Norway and Liechtenstein
- 24% for other taxpayers.
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