Tax in Spain

Continuing on last week’s post (10% VAT on holiday homes), holiday home landlords must now raise VAT invoices with their guests as of the 1 December 2026. This is because the tax office now regards holiday homes as running a business activity.

Foreign demand for Spanish property continues to grow, making it increasingly important for buyers to understand the taxes that apply to non-resident homeowners. The purchase of a property is subject to VAT or Property Transfer Tax (ITP), depending on whether the home is new or resale, while Stamp Duty (AJD) may also apply. Non-residents who own property in Spain must meet ongoing tax obligations, and sellers are required to declare any capital gain or loss through Spain's Non-Resident Income Tax (IRNR) system.

If you're buying property in Spain, you may be wondering whether you'll need to pay stamp duty.

Disclaimer: the information contained in this article is provided for general information purposes only and may not reflect the most current legal developments.

The Property Transfer Tax (Impuesto de Transmisiones Patrimoniales, or ITP) is the main tax payable when buying a second-hand property in Spain.

Plusvalia tax is a devolved tax levied by the town hall where your property is located. It taxes the increase in value of the land (hence its Spanish namesake, plusvalia, or increase in value).

Second homes are a significant part of the Spanish real estate market. Many people buy a second home as an investment, to have somewhere to relax or as an alternative to their main residence.Venturing into buying a second home can be an odyssey.

Tourist taxes, often called sustainable tourism levies or city taxes in Spain, are now part of the standard cost of a trip.

Spain’s government is preparing a new housing package that combines a sharp increase in VAT on tourist rentals with measures to extend and stabilise rental contracts, presented as part of its response to the country’s housing crisis.Spain’s new housing push: why it matters if you own or rentThe Span

Unbeknownst to most non-resident property owners, when buying property in Spain, you automatically become liable to pay IBI tax the following year. No one will give you a heads-up on this tax, so it is up to you to find out how much you owe and comply with your local Tax Authorities.

Congratulations, you are now the proud owner of a Spanish property! It’s understandably a time to be giddy and excited. But has anyone bothered to tell you about the ongoing maintenance costs and taxes of owning a Spanish property?

Continuing with last week's article (Taxes on buying property in Spain), in today’s article, we focus on the taxes sellers need to face.Capital Gains Tax Plusvalia TaxCapital Gains Tax This tax is paid to the central government, to the Spanish Tax Office (AEAT).CGT is taxed on th

The European Commission has expanded an investigation launched seven years ago into Spain’s treatment of non‑resident taxpayers, who are excluded from income tax reductions on rental income. While resident taxpayers can benefit from a reduction of up to 60% on taxable rental income, non‑residents are not eligible for this deduction, according to the Commission.

For decades, the phrase Gibraltar tax haven has shaped political debate and cross-border tax planning in southern Spain.

Is it legal to rent a property to your brother in Spain? Can you rent a home to your parents? While these arrangements may raise suspicion, they are entirely legal.

A ruling by the High Court of Justice of Catalonia clarifies a common misunderstanding among tourist‑rental owners – it is not enough to declare only occupied days or to deduct all annual expenses without justification. Property owners must report the entire year, distinguishing between periods that generate rental income and those subject to imputed income. The court also stresses that the burden of proof lies with the taxpayer – and that a lack of documentation invalidates any deductions claimed.

Signing a sales contract does not always trigger an immediate tax obligation. In transactions with deferred delivery, where possession is transferred at a later date, the Spanish Directorate General of Taxes has clarified that capital gains are only taxable once the property is effectively handed over – not when the deed is signed. For tax purposes, ownership transfer depends on possession, not the notarial act alone.

Investing in funds is a common way to grow your savings – but it comes with tax implications that must be reflected in your tax return.

With a different pace of life, lower living costs and access to European culture and travel, moving to Spain from the US continues to be a popular option for those seeking change. However, moving to Spain involves more than simply choosing a location.

On 18 March, Spain’s Congress of Deputies approved a decree-law including aid for storm-affected areas in Andalusia and Extremadura – along with a tax break for low earners. Workers on the minimum wage, set at €1,221 gross over 14 payments in 2026, will benefit from a personal income (IRPF) deduction of up to €591. The Ministry of Finance estimates this will reduce their annual tax bill by around €365 compared to last year.

Spanish inheritance tax (Impuesto sobre Sucesiones y Donaciones – ISD) is a tax paid by beneficiaries who inherit assets in Spain. The amount due depends on the value inherited, the heir’s relationship to the deceased, and the Autonomous Community involved.

Parents often transfer money to their children to help with expenses such as buying a home. However, many overlook a key step – declaring the transfer and paying the corresponding gift tax. Spanish authorities are paying closer attention to these movements, and banks must report certain transactions. Here are the limits and rules that apply to these transfers.

The date has been set for the 2025–2026 tax return filing period. Like every year, taxpayers will submit their accounts to the Tax Agency during the spring months.The tax calendar also sets out the key dates for filing personal income tax returns (IRPF), online, by phone or in person.

Spain’s Digital Nomad Visa could lure remote workers frustrated by the Iran‑UAE conflict, offering residency with appealing tax terms under Spain’s favourable regime. As instability around Iran shakes confidence in Dubai, some professionals are exploring relocation to Spain for work flexibility and reduced taxation.

If you are planning to live, work, or invest in Spain, you may have heard the term “Hacienda” and wondered what it means.