The tax that property owners in Spain forget

If you are a non-resident and own a flat or a house in Spain, you owe the Spanish state a tax every year, even if you only use the property yourself and it earns you nothing. Many owners find out only when a letter from the Agencia Tributaria arrives or when part of the sale price is withheld at the sale. Yet the rule is simple once you know it.

What it is about

Spain taxes non-residents on a notional rental value of their property, the so-called renta imputada. The basis is the cadastral value, the valor catastral, which appears on the annual municipal property tax bill (IBI). If that value has been revised in the last ten years, 1.1 per cent of it counts as income; otherwise 2 per cent. On that amount, owners resident in the EU, Norway or Iceland pay 19 per cent tax; everyone else, including residents of the United Kingdom, 24 per cent.

An example: with a revised cadastral value of 100,000 euros, the notional income is 1,100 euros. The tax is 209 euros a year at 19 per cent, 264 euros at 24 per cent. The return is called Modelo 210.

Each owner files separately

The tax is charged per owner, not per property. A couple who own the flat half each file two returns, each for half the amount. There is no joint assessment. Anyone who owns a garage or storage room with its own cadastral reference alongside the flat must declare that too.

The deadline

The return for a calendar year must be filed by 31 December of the following year. For 2025 the deadline is therefore 31 December 2026. If the property was bought or sold during the year, the tax is declared pro rata by days.

Letting is different. Since tax year 2024, rental income of non-residents is declared in a single annual return, due between 1 and 20 January of the following year. For the periods in which the property was not let, the renta imputada still applies.

What happens if you do not file

The Agencia Tributaria knows every owner through the land registry and the cadastre. For some years it has been writing systematically to non-residents who have not filed, claiming the tax for the last four years. Anyone who files late voluntarily, before such a letter arrives, pays a surcharge of one per cent per month or part of a month, and 15 per cent plus interest after a year. Waiting for the tax office to get in touch adds penalties. The four previous years can be filed at any time, and that is almost always cheaper than waiting.

When you sell

At the latest, the tax catches up with everyone at the sale. The buyer must withhold three per cent of the price and pay it directly to the tax office. The seller then has four months to settle the actual gain with a Modelo 210 of their own. If the gain was smaller than the amount withheld, the difference can be claimed back. Missing returns from earlier years are routinely checked and set off at this point.

And at home?

The Spanish tax does not replace your obligations in your country of residence. Income from a Spanish property usually belongs in the home-country return as well. The double taxation agreements Spain has with the United Kingdom, Ireland and most other countries provide that the tax paid in Spain is taken into account, so that nobody pays twice, provided it was actually declared and paid in Spain.

What you need

Three things are enough for the return: the Spanish tax number NIE of each owner, the latest IBI bill with the cadastral reference and cadastral value, and the ownership shares according to the purchase deed. Anyone who wants to file themselves also needs a digital certificate from the Spanish administration or Cl@ve. Without a certificate, the return can be filed through a colaborador social authorised by the Agencia Tributaria.

The tax is usually small. The trouble when it is left unattended for years is not. File your return for 2025 by the end of the year and the matter is settled for twelve months.

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