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.

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 the municipality has revised its cadastral values, 1.1 per cent of the value counts as income; otherwise 2 per cent. The revision normally has to be less than ten years old, but for 2023 to 2025 every revision since 2012 counts. On that amount, owners resident in the EU, Norway, Iceland or Liechtenstein 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 can claim the tax for the last four years, and returns for those years can still be filed late. A return filed late on the owner's own initiative carries a surcharge of 1 per cent plus 1 per cent for each full month of delay, and 15 per cent plus interest after twelve months. If the tax office writes first, it can impose a penalty of 50 to 150 per cent of the unpaid tax instead.

When you sell

When a non-resident sells, 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 tax on the gain was smaller than the amount withheld, the difference can be claimed back.

And at home?

Neither the United Kingdom nor Ireland taxes the notional income of a property that is not let. There is no income from it to declare at home, and the Spanish tax on that income cannot be set against UK or Irish tax. If the property is let, the rent is in most cases taxable at home as well, and under the double taxation agreements with Spain the Spanish tax on it is credited, up to the UK or Irish tax on the same income. A gain on a sale is likewise taxable at home, with a credit for the Spanish tax on it.

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. Owners who file themselves can do so online with a digital certificate from the Spanish administration or Cl@ve, or on paper with the form completed and printed on the Agencia Tributaria's website. A colaborador social authorised by the Agencia Tributaria can also file the return for them.

File your return for 2025 by the end of the year and the matter is settled for twelve months.

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