Tag Archives: rental

Tax obligations for owners of real estate in Spain

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Owners of real estate in Spain must pay tax on their properties regardless of their place of residence. In practice, resident and non-resident property owners pay the same taxes in Spain, although the names and collection mechanisms of these taxes differ.

A real estate property can generate earnings, either through renting or because of sale. Also, under tax law, just owning a property generates a notional income that is taxable. All these incomes must be declared in Spain. If the property is located in Spain, Spain is the competent state for collecting any tax due. This is according to all the double taxation treaties that follow the general OECD model under which income from real estate property can be collected in the country it is in, regardless of the country of tax residence of the taxpayer.

In addition to paying any income tax due to the national Spanish tax agency, the property owner must also pay all other taxes due to other agencies. This includes, for instance, the municipal property tax collected each year by the local council. And, when you sell your property, the capital gains tax you also should pay to the council.

Lastly, in Catalonia and some other autonomous communities, there is a further tax on an activity widespread among foreign investors in coastal properties: the short-term leasing to tourists. The tax is a small amount due per night for every person staying in the property, which must be registered for tourist use with the local council.

Carlos Prieto Cid

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New Obligations for Tourist Accommodation Owners

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Last year, tourist accommodation owners in Spain were required to obtain a Unique Rental Registration Number (NRUA) if they wanted to advertise their properties online. Now, to maintain this registration, they must comply with a series of reporting requirements.

Owners of properties intended for short-term rentals must submit an information return detailing the activity carried out during the previous year in these properties, specifying each category and type of rental that took place there. This declaration consists of an anonymized list of rentals made by hosts or landlords who provide short-term accommodation rental services through online platforms.

This information declaration for short-term rentals must be submitted during the month of February each year, with information on the rentals established in the previous year. One separate information return must be submitted for each property, ship, vessel, or naval craft intended for short-term rental. For each NRUA (Unique Rental Registration Number), it will be indicated whether the purpose of the rental was on vacation or tourism, work, studies, medical reasons requiring relocation, or any other reason. If there are well-founded doubts about the declared purpose, the property registrar may request additional supporting documentation.

Failure to fulfil these requirements will result in the withdrawal of the rental registration number.

Carlos Prieto Cid

Lawyer

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New increase in the tourist tax rate for stays in tourist establishments in Catalonia starting in the summer of 2025

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If we rent our vacation home in Catalonia to tourists, our guests must pay the tourist tax (IEET), per person and per stay unit, with a maximum of seven consecutive nights in the same accommodation. Rates vary depending on the type of accommodation, its category, and whether it is in the city of Barcelona or anywhere else in Catalonia.

This tax will increase again in 2025, as the Catalan regional government has decided to double the tax rates. In addition to this significant increase in the regional tax, all Catalan municipalities also have the option of adding a municipal surcharge to the Catalan regional tax, something that until now had only been applied in the city of Barcelona. Therefore, the amount per night may vary, even outside of Barcelona, ​​from one municipality to another, as it will be up to the city councils to decide whether or not to apply these surcharges. However, in any case, municipal surcharges cannot exceed a maximum of €4 per night. Therefore, the maximum amount that can be charged outside of Barcelona for the occupancy of a tourist accommodation will be €6.

Filing the periodic return for this regional tax on stays in dwellings for tourist use, as well as any applicable municipal surcharges, must be done electronically. This tax may also be part of the tax base for calculating VAT, depending on the circumstances. Furthermore, tourist rentals always accrue income tax, regardless of the owner of the rented property being resident in Spain or abroad. Therefore, it is better to seek advice from tax experts when renting your vacation home.

Carlos Prieto Cid – Lawyer

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