PROPERTY OWNERS’ IMPUTED INCOME TAX (IMPUESTO SOBRE LA RENTA): This is a tax that must be paid by non-resident property owners every year. Resident owners who can prove that their property in Spain is also their principal residence are exempt. Non-residents are taxed on income received in Spain at a flat rate of 24% (25% until 31st December 2006). Where no actual income exists the Inland Revenue will impute an income usually based on 2% of the value of the property (valor catastral) which is registered at the Land Registry (Catastro). On new properties which have recently had their value revised, this is usually reduced to 1.1%.

PROPERTY WEALTH TAX (IMPROPERTYPUESTO SOBRE EL PATRIMONIO): In addition to the Real Estate Tax the Spanish property owner, whether resident or not in Spain, will pay Spanish tax on capital assets. This tax affects residents and non-residents differently. As a non-resident it’s a tax on all your assets and property in Spain. These taxable assets include anything he owns, not just real estate (bank deposits, shares, automobiles, yachts or anything that can be considered wealth).

*Please, go to our Buying & Selling Property in Spain Guide for more details. CLICK HERE