This article answer to some Frequent Asked Questions about the Non Residents Income Tax with regards to property in Spain.
What is the non-resident income tax?
Tax on income obtained by non-tax residents in Spain.
It is a Spanish direct tax on any kind of income obtained by all the non-tax resident individuals and/or entities.
Who has to pay this tax?
Non-tax residents in Spain.
Basically, non-resident individuals and/or entities in Spain who obtain any kind of income in Spain.
Who is a tax resident in Spain then?
Whoever spends more than half a year in Spain.
Basically, whoever stays more than 183 days in a calendar year in Spain unless another tax residence is proven.
When counting the 183 days, you do not include temporary absences and holidays. So, if you spend two weeks abroad on holiday, it doesn’t really count for this purpose and it is understood that those two weeks you have been resident in Spain.
Who else is considered a tax resident in Spain?
Spouse, minors and dependants of a tax resident.
The spouse, minor(s) and dependent(s) of a tax resident in Spain will be considered tax residents as well in this country.
Which is the tax year in Spain?
It’s the same as the calendar year.
In Spain, the tax year matches the calendar year. It runs from January the 1st until December the 31st.
Which service does spainpropertytax.com offer?
It deals with the non-tax resident income tax for your property’s implicit income (we will call it «silent income» from now on).
This web completes the non-tax resident income tax return procedure from start to finish. This includes submitting the tax declaration and paying the tax obtained each year from owning a property in Spain or having any kind of rights or interest on it to the Spanish tax authorities.
Which type of income obtained by non-residents in Spain cannot be declared using the service on this page?
Any type of income other than the silent income from your property.
Even any income earned from renting the property is not provided by this page.
So, I am supposed to obtain some income in Spain if I own a property there and just because I am a property owner?
Yes, you are. It is your property’s silent income.
Exactly. We will call it the property’s silent income. It is an implicit income just for the sake of being a property owner in Spain.
And what is the property’s silent income?
It is a sort of presumed income from owning a property in Spain or having the rights to enjoy the use of one.
When you own or have any rights to enjoy real estate in Spain, which is neither linked to any economic activity nor does it produce any other specific income (such as rental income), and it is not your main residence, it is presumed by the tax law that you obtain a kind of income.
And how is my property’s silent income calculated?
Either by the rateable value or the acquisition value.
It is calculated either by the rateable value of the property or by the acquisition value (i.e. purchase price or the value given when the property was inherited or donated).
And what is the rateable value?
It is the tax registry value shown in the Catastro (property tax registry).
The rateable value is what the Spanish call “Catastro” value, which is basically a tax registry of every property with a value assigned to each one.
How do I know the rateable value of my property?
It is in your property’s council tax (IBI in Spanish which stands for “Impuesto sobre Bienes Inmuebles») receipt.
The rateable value is shown on the council tax receipt for your property. In Spain, the council tax is called the “Impuesto sobre Bienes Inmuebles” or IBI for short.
If you have any queries on your rateable value you can always check with the town hall where the property is located.
The Catastro value it is updated periodically.
How is the tax bill calculated?
Basically finding the taxable base and applying the corresponding tax rate. You can check the formula in here.
First, we must find the taxable base and then the tax rate is applied to it. From this amount we can work out the final amount to be paid in the tax bill.
How do we find the taxable base?
In brief, property value by a coefficient equals the taxable base.
To find the taxable base we must make the following calculations:
- If a rateable valueexistsyou have to multiply either by 2% or by 1,1% if the rateable value in force has been reviewed within the last 10 years.
- If there is not a rateable value in forceyet then the taxable base is calculated multiplying 1,1% by the 50% of the acquisition value (i.e. purchase price), or the value assigned when you inherit the property or if you were a donee, or the property value assigned by the tax office on a inspection procedure for instance.
Is it possible for a property not to have a rateable value?
Yes, it is for a property to lack rateable value.
Yes, it is possible. For instance, for a brand-new building it will take some time for the tax office to register the new properties, calculate their rateable value and notify these figures to the owners. During this time, the properties will not have an official rateable value.
Please, take into account that the rateable value assigned will be in force from the following full tax year after notification.
How do I know if the rateable value was reviewed within the last 10 years?
Your IBI receipt shows when it was last reviewed the rateable value.
You can also enquire at the town hall where the property is located or or the corresponding local tax agency if any.
Which tax rate must I apply to the taxable base?
From the tax year 2016 onwards, the tax rate is 19% for EU members, Iceland and Norway and 24% for the rest of the non-residents in Spain.
Once you have found the taxable base, you must apply the appropriate tax rate. This will depend on the year of tax accrual and the nationality of the non-resident according to the following table:
Table source: tax office
This would give you the final tax bill amount in full that must be paid for the full property and for the full year.
What does the tax bill for the “full property” mean?
It means that this amount has to be shared between all the persons who have any right on the property (i.e., owners and life interest title holders)
In other words, it means that this is the tax bill for the full property, and this should be shared between all the persons who own or have an enjoying right on the property. For instance, if a property is owned by a couple, each member of that couple will have to declare, submit their own corresponding tax form and pay 50% of the full tax bill.
What does the tax for the “full year” mean?
The tax bill is paid in proportion to the length of ownership in the tax year.
For instance, if a non-resident buys a property on July the 1st she or he will pay the non-resident income tax for only half of the year.
When is the tax accrued?
On December the 31st of each tax year.
When do I have to pay?
During the full year following the accrual year.
The tax has to be submitted during the whole following calendar year after the accrual. That is to say, during 2016 and up to December the 31st 2016, non-tax residents should submit the tax form for the calendar year of 2015. And so on.
How should I pay?
By means of the 210 tax form.
The tax must be submitted using the 210 form.
Do I submit just one form per property?
One form per person, per property and per tax year is required.
One form per person, per property and per tax year is required. ‘Property’ means the real estate which has an independent reference number in the Catastro and, consequently, have an independent tax receipt.
For instance, if a couple owns an apartment, a garage and a store room in an urbanization in Spain, and assuming that the apartment, the garage and the store room have an independent tax reference each, then each owner will should submit three forms. This is, one for the apartment, another one for the garage and the third one for the store room. This makes a total of six tax forms in this case.
Can I submit the form/s on my own?
Yes, you can.
You can do it on your own in two different ways:
(i) If you are in Spain, you can fill in and download the form from the Spanish Tax Authority’s page on this link: tax office. However, the form is only in Spanish, I’m afraid. Once you have filled it in, you can print it out and pay it either in cash or by making a direct debit to your bank account. All the major national banks in Spain will allow you to do this. You should keep a copy of the form to say that you have paid for your records, but it is not necessary to send any other paperwork to the tax office. The bank will do this for you as they have a cooperation agreement in place.
(ii) If you want to make the payment via a transfer from a bank outside of Spain, then you must also send the payment record along with the completed form to the tax office at the following address: Agencia Tributaria, Departamento de Gestión Tributaria, Oficina Nacional de Gestión Tributaria, IRNR, Modelo 210, C/ Lérida 32-34 [Registro General]; 28020 Madrid. You can find more information at: tax office.
(iii) Another option is to ask the tax authority for a digital certificate, which you can then set in your computer to be able to complete the form and pay the tax. This way, you can even pay by bank card through the Spanish Tax Authority’s web page at the following link: tax office.
All the regulations regarding the 210 tax form are in the following links:
How can spainpropertytax.com help me?
We can pay your property’s silent income tax for 60€ plus VAT per year and we promise we will never ever charge more fees (including VAT) than taxes.
This web can take care of your non-tax resident income tax for you for a fixed fee of 60€ plus VAT at the current rate in force per property and per year with regards to your property’s silent income.
How spainpropertytax.com do it for me?
We liaise with the tax office using our Law Society’s digital certificate.
The procedure is as follows:
- Go to our tax calculator to find out your tax bill and legal fees to pay,
- Press continue if you wish us to deal with your property’s Non Resident Income Tax, and complete the necessary details fo submit your tax forms/s, and
- Pay by debit or credit card
As easy as that.
Once the above is done, we will send you the sumitted tax form by email. The tax form has embedded the CSV code (which stands for «Código Seguro de Verificación» or Secure Verification Code) which allows you to locate the tax form submitted on the official Spanish Tax Office website agenciatributaria.gob.es).
Will you be my tax representative in Spain?
Yes, we will be your tax representative.
Yes, when you engage this tax processing service by accepting the Terms and Conditions, we will then act as your tax representative only with regard to the required tax year.
Please, take into account that your tax domicile in Spain will be your property and not our domicile as far as the tax office is concerned.
When spainpropertytax.com talks about “a/your property”, what does it mean exactly?
It means any property with an independent tax reference.
When this web says “a/your property”, it means andy property with an independent tax reference in the Catastro. Sometimes, one tax reference includes a dwelling plus a garage and a store room for instance. On other occasions one tax reference is related only to one garage or to one store roome. It depends. For the puroposes of this page, “property” refers to a property with an independent tax reference in the Catastro. So if you wish to calculate your taxes with spainpropertytax.com and you own an apartment with a garage with different tax references in the Catastro you can calculate your taxes independently for each property at spainpropertytax.com.
What is our aim?
Our aim is to help you to deal with your Spanish property’s silent income tax in the easiest and safest way. And with the best value for money.
Which is our promise? No more fees than taxes. Ever
You will never pay more fees than taxes with us.
We promise you that with us you will never pay more in legal fees than you do in taxes.
Furthermore, if for whatever reason your tax bill falls under 60€ plus VAT per property, we will match our fees (including VAT) accordingly.
Can I have more information please?
The Spanish Tax Office publishes a very useful guide on this subject in English which you can chek here.
Additionally, you can find the non-resident income tax General Regulations here.
Thank you for your time and attention and I hope this information is of use. You are very welcome to share if you liked it. You might be interested in this other taxes posts such as the plusvalia current situation or the inheritance and donation tax.
Please, note that this is general information. This is not specific legal advice. It is advisable to seek legal advice for any specific legal issue.