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Spain Tax Rate

Here at Manzanares Lawyers, we understand that trying to comprehend Spanish tax laws can be a tough task. Spanish tax rates vary depending on whether you are a resident or a non-resident. You are classed as a Spanish resident if you live in the country for more than 183 days a year, any less time than this and you are classed as a non-resident.

Do I still need to pay income tax if I am a non-Spanish resident?

The short answer to this is yes. If you own any property in Spain, or any other assets and investments, then you will be required to pay income tax to the Spanish authorities.

What non-resident taxes in Spain do I have to pay?

If you are required to pay non-resident taxes, this can come in a number of forms:

IBI Tax

This is based on the rateable value of the property that you own. It is paid to a town hall or SUMA office, and is a form of council tax.

NRIIT (Non-Resident Imputed Income Tax)

Spanish authorities believe that even if you are a non-resident and not renting out a property, you are still achieving a financial benefit. This non-resident tax in Spain will have to be paid as a result.

NRIT (Non-Resident Income Tax)

As well as NRIIT, you will also be required to pay income tax. This income tax in Spain is paid on a quarterly basis and will have to be paid if the property is rented out in the short or long term. This means that if you rent out a property for 4 months of the year, you will have to pay NRIT tax for 4 months, and NRIIT tax for the remaining 8 months that the property is not being rented.

Capital Gains Tax

You will be required to pay Capital Gains Tax for any properties, investments or assets that are sold and located in the country. This is based on the price of the original purchase and how much you sell it for.

Inheritance Tax

This is paid irrespective of if you are a resident or non-resident in the country and is incurred if you inherit a property or asset in the country. This tax usually has to be paid within 6 months of the death, however there is an option to request a time extension of up to 6 months, giving you 12 months to pay any outstanding taxes.

If these deadlines are not met, it can result in fines ranging from 5-20%. Making a will helps the process of paying Spanish inheritance tax easier and avoid the stress of worrying about fines.

Wealth Tax

This mainly effects Spanish residents; however, it  can also affect non-residents too. It is measured on the assets you own in the country, rather than the income you get. Assets can be a variety of things, including properties, savings, art, jewellery, cars etc. If you are unsure on how, or if, this tax will apply to you then contact a member of our experienced team for assistance.

Contact us

If you are unsure how or why certain taxes apply to you – or even if they apply at all – then get in touch with a member of our team today. You can request a free consultation or call our office directly on +34 952 59 50 42 (Alhaurin) or +34 952 82 41 12 (Marbella). Alternatively, you can email us at clientservices@manzanareslawyers.com.

FAQs

Ideally, you would have some idea of tax laws when living in Spain. This allows you to keep in control of your spending, and how helps you budget accordingly so you can live a safer day to day life. However, we understand that if you are planning on living in Spain in the future, or are relatively new to the country, you may not know about the basic taxes you will have to pay. Here at Manzanares Lawyers can give you an overview of each kind of tax, so you are fully aware of them and how they may affect you in the future.

If you fail to abide by Spanish tax laws and don’t pay your taxes, you will face a hefty fine, or in some cases, jail time. This is why it is crucial to make sure you know exactly what taxes you will be paying when you become a Spanish resident, so you can avoid getting yourself in trouble with the law. The team of experts at Manzanares Lawyers specialise in and have thorough knowledge of all Spanish tax laws. We can help you quickly understand any taxes you may have to pay so you can live a relaxed life in Spain on the right side of the law.

There are a few variables that determine whether you are a “tax resident” in Spain or not, that are worth looking out for. If one or more of the following apply to you, then you may be obliged by law to pay Spanish tax:

  • Your main interests live in Spain. This applies to people who may work overseas yet have family members such as their spouse or children under the age of 18 that still depend on them still living in Spain
  • Your primary professional activities are conducted in Spain. This means that if you are self employed in the country, or if your place of employment is in Spain, you will have to pay Spanish tax
  • You have spent more than 183 days in Spain within a single calendar year, with this being regardless of whether you are formally registered as a resident or not