If you own a holiday home or investment property in Spain but live abroad, the country where you are tax resident has a direct effect on your Spanish tax bill. Spain does not tax you by nationality. It looks at where you live, and that decides your tax rate, whether you can deduct rental costs, and how inheritance and wealth taxes work.
So which countries are “best” for owning Spanish property from a tax point of view? The short answer is that residents of the EU, Iceland, Norway and Liechtenstein get the most favourable treatment in Spain, while residents of countries such as the UK, the US, Canada and Switzerland pay more. But Spain is only half of the picture. Your home country also decides how your Spanish income and gains are taxed, and that can matter just as much.
This guide covers the rules for non-residents. If you spend more than 183 days a year in Spain, you may be a Spanish tax resident instead, which is a different system.
The short answer
Your country of tax residence | Spanish rate on rental and imputed income | Rental expenses deductible? | Capital gains tax on a sale |
|---|---|---|---|
EU member states, Iceland, Norway, Liechtenstein | 19% | Yes, costs linked to the rental | 19% |
UK, US, Canada, Switzerland, Australia and other countries | 24% | No, as a general rule | 19% |
In plain terms: an EU/EEA resident usually pays less on rental income, because the lower rate applies to a smaller taxable amount. For a property that stays empty, the difference is small. For a property that earns serious rent, it can be large.
How Spain taxes non-resident property owners
Whatever country you live in, a non-resident owner can face these taxes:
Imputed income tax: even if you never rent the property out, Spain taxes a notional income of 1.1% or 2% of the cadastral value, at 19% or 24%, filed annually on Modelo 210.
Rental income tax: if you rent the property, you declare the actual rent on Modelo 210.
Capital gains tax: when you sell, the gain is taxed at 19%, and the buyer withholds 3% of the price on account.
IBI: the yearly local property tax, billed by the town hall to every owner.
Wealth tax: it only applies to Spanish assets, and only above an allowance.
Inheritance and gift tax: it depends on the region where the property is located.
EU/EEA vs everyone else: the 19% and 24% rule
The Spanish Tax Agency (AEAT) applies a 19% rate to residents of the EU, Iceland, Norway and Liechtenstein, and 24% to everyone else. For EEA countries outside the EU, the 19% applies where there is effective exchange of tax information with Spain. Since Brexit, UK residents are in the 24% group.
The second difference is just as important: EU/EEA residents can deduct expenses that are linked to the rental, such as mortgage interest, IBI, community fees, insurance and certain repairs. As a general rule, residents of other countries are taxed on the gross rent with no deductions.
Example 1: a property you do not rent out
Cadastral value €100,000, imputed income of 1.1%:
EU/EEA resident | Non-EU resident | |
|---|---|---|
Imputed income | €1,100 | €1,100 |
Tax rate | 19% | 24% |
Annual tax | €209 | €264 |
The gap is only €55 a year, so for an empty second home the country you live in makes little difference.
Example 2: a property you rent out (illustrative figures)
Gross rent €12,000, deductible expenses €4,000:
EU/EEA resident | Non-EU resident | |
|---|---|---|
Taxable amount | €8,000 (after deductions) | €12,000 (gross) |
Tax rate | 19% | 24% |
Annual tax | €1,520 | €2,880 |
Here the non-EU owner pays €1,360 more, almost double. This is where being an EU/EEA resident really pays off.
What is the same for every country
Some rules do not depend on where you live:
Capital gains tax on a sale is 19% for all non-resident individuals. Many websites wrongly say non-EU sellers pay 24%. That higher rate applies to other types of income, not to capital gains on property.
The 3% retention by the buyer applies to every non-resident seller.
IBI is charged to all owners, resident or not.
Imputed income and rental returns are filed on Modelo 210, whatever your country.
Inheritance and gift tax: where you live and where the property is
Spanish inheritance tax is set largely by the autonomous region, and it varies a lot. Andalusia and Madrid both apply reductions of up to 99% between close relatives, which can bring the tax close to zero for spouses, children and parents.
For non-residents, the key points are:
EU/EEA residents can apply the regional rules of the region where the Spanish property is located. This was introduced after a European Court of Justice ruling that found the old system discriminatory.
Residents of other countries were historically pushed into the higher national rules. Court rulings and later changes have opened regional benefits to non-EU residents in many cases, but eligibility depends on your situation, so check it before relying on it.
The filing window for inheritance tax is generally six months from the date of death.
This is one of the strongest reasons to choose the region of your Spanish property carefully, and to plan ahead with a will.
Wealth tax: only on Spanish assets
Non-residents pay Spanish wealth tax only on assets located in Spain, mainly property. The €700,000 allowance applies, but the extra €300,000 exemption for a main home is for residents only. Rates run from 0.2% to 3.5%.
Some regions, including Andalusia, give broad relief on the regional wealth tax. However, a separate national Solidarity Tax applies to net assets above €3 million, so large Spanish holdings still need a check. For most owners of a single apartment or villa, wealth tax is not a concern.
Your home country matters as much as Spain
Spain has double tax treaties with more than 90 countries. Under most of them, income from real estate and gains on selling it can be taxed where the property is located, so Spain keeps the right to tax your Spanish property.
Your home country usually still wants to see the income, and then avoids double taxation in one of two ways:
Credit method: your home country taxes the income but gives you credit for the Spanish tax. This is common for the UK and the US. If your home rate is higher than the Spanish rate, you pay the difference.
Exemption method: your home country exempts the income already taxed in Spain, sometimes taking it into account for the rate. This applies to some European countries under their treaties.
What to check for your own country:
Does it tax foreign rental income, and does it use credit or exemption?
Does it tax a gain on selling foreign property, and at what rate?
Does it have a wealth or net worth tax that includes foreign property? Some countries, such as Norway and Switzerland, do.
Does it have its own inheritance or estate tax that reaches property abroad?
Because these rules differ so much, two owners with identical Spanish properties can have very different total tax bills. The Spanish side is the same for everyone in the EU/EEA, so the real difference between those countries lies at home.
How to keep your Spanish tax as low as possible
File every year. Imputed income and rental returns are required even if you owe little, and late filing brings surcharges and interest.
Keep every invoice linked to a rented property if you are an EU/EEA resident, so your deductions are supported.
Check your deadlines. The filing dates for imputed income are changing for 2026 income, so always check the current AEAT calendar.
Keep proof of Spanish tax paid for your home tax authority, so you can claim credit or relief.
Plan for inheritance before you need to, especially if you own in a region with strong family reductions.
Estimate your tax first. Our Modelo 210 tax calculator and the step-by-step calculation guide show what you are likely to owe.
Frequently asked questions
Which country’s residents pay the least tax on Spanish property? In Spain, residents of any EU country, Iceland, Norway or Liechtenstein pay the lowest rate, 19%, and can deduct rental expenses. The difference between those countries comes from their own home tax rules.
Do UK residents pay more tax than EU residents on a Spanish property? Yes. UK residents are taxed at 24% on rental and imputed income, with no expense deduction as a general rule, while EU/EEA residents pay 19% and can deduct costs. Capital gains on a sale are 19% for both.
Does my nationality or my residence decide my Spanish tax rate? Your country of tax residence, not your passport. A British citizen who is tax resident in Germany is treated as an EU/EEA resident.
Is Switzerland treated as EU/EEA for the 19% rate? No. Switzerland is outside the EU and the EEA, so the 24% rate applies.
Do I pay tax in both Spain and my home country? Spain taxes the income first, and your home country usually gives credit or an exemption through a double tax treaty. You normally still need to declare the income at home.
Do I owe tax if my Spanish property is empty? Yes. Spain charges imputed income tax on non-resident owners even if the property is not rented, calculated on the cadastral value.
Do co-owners file together? Each owner generally files for their own share of the property.
Sources and official information
AEAT: tax rates for non-residents without a permanent establishment
PwC Tax Summaries: Spain foreign tax relief and tax treaties
This article is general information and not personal tax advice. Rates, deadlines and regional rules change, and your home country’s rules add a second layer, so confirm your situation with the Spanish Tax Agency or a qualified adviser.