Tax
Owning property in Spain as a non-resident: Modelo 210 and IBI
Non-resident owners must file in Spain every year, whether or not the property is let. What to file, on which income, and which expenses count.
If you are not resident in Spain but own property here, you have Spanish tax obligations, whether or not you let the property. The central one is Modelo 210, the non-resident income tax return, filed with the Spanish Tax Agency.
Why a return is due even if the property is not let
Spanish tax rules consider that a property generates income for its owner even when it is not let to anyone. For non-residents, this imputed income must be declared annually on Modelo 210 and tax paid on it.
The taxable base is calculated by applying a percentage to the cadastral value of the property. The percentage depends on whether the cadastral value has been revised in the last ten years.
Rates
The rate applied to non-residents currently depends on where the owner is resident:
- 19% for residents of the European Union, Iceland and Norway
- 24% for residents of other countries
If the property is let
Where the property is let, Modelo 210 is used to declare the rental income received during the year. Residents of the EU, Iceland and Norway can deduct expenses directly related to generating that income, such as:
- Mortgage interest
- Repair and maintenance costs
- Property insurance
- Utilities and community fees, where paid by the owner
- Furniture, which is depreciated over time
Deductions apply in proportion to the days the property was actually let. Owners resident outside the EU, Iceland and Norway cannot deduct expenses and are taxed on gross rental income.
Local tax: IBI
Separately from Modelo 210, owners pay the municipal property tax, IBI (Impuesto sobre Bienes Inmuebles), every year. It is set by the municipality where the property is located, and so is the payment calendar.
In summary
- File Modelo 210 every year, whether or not the property is let
- Declare all rental income, and deduct expenses only where eligible
- Pay IBI according to your municipality’s calendar
- Check how the Spanish tax interacts with tax in your country of residence
This article summarises the general rules. The position for any individual owner depends on their circumstances and should be confirmed before filing.
