The European Commission has expanded the case opened seven years ago against Spain for not allowing non‑resident citizens to benefit from a reduction in income tax on rental income from real estate.
The disciplinary proceedings date back to March 2019, when Brussels sent a first letter of formal notice to the Spanish authorities, requesting that they correct the irregularities.
EU services explain that resident taxpayers benefit from a reduction of up to 60% of the taxable base derived from rental income, whereas non‑residents are not eligible for this deduction.
In the Commission’s view, this difference in tax treatment constitutes a “restriction on the free movement of capital”, and it regrets that Spain has not amended its legislation to eliminate this discrimination, despite ongoing dialogue with the EU institution.
The Commission also notes that, in 2025, the government introduced changes that do not resolve the issue. Instead, these measures mean that only residents can benefit from deductions ranging from 20% to 90% of the taxable base derived from renting properties, thereby continuing to discriminate against non‑residents.
Brussels is therefore giving Spain two months to “respond and rectify” these shortcomings. If Spain fails to comply, the Commission may take the next step in the infringement procedure, issuing a reasoned opinion. This would open a final period for dialogue, before, if the non‑compliance persists, the case is referred to the Court of Justice of the European Union (CJEU).
Lawyer Alejandro del Campo has urged non‑resident landlords – both within and outside the EU – via social media to consider requesting the rectification of their self‑assessments (Form 210) and claiming refunds for undue payments before their rights expire.
