Rental Property in Spain

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Resident landlords

The Spanish tax man has sweetened the rental package recently by introducing a reduction of 50% in rental income for tax purposes. However, this unfortunately applies only to official residents on Spain. It is designed to stimulate the rental market. Resident landlords can deduct almost every expense imaginable from their rental income, meaning that most landlords will pay little or nothing in income tax.

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Non-resident Landlords

Non-residents are allowed no deductions and must declare their rental income on a special form 210.

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Identification of the Landlord

Tenants who make tax declarations in Spain are now required to list their landlord`s name and tax number on their income tax declaration along with the Catastral reference of the property they rent. Although many owners rent out their flats and do not declare the income, this requirement to identify the landlord has already produced tens of thousands of new tax declarations in its first years.

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Important! Tax on Rental Contracts

Unfortunately, a large proportion of owners who let their Spanish property, seem blissfully unaware that they are subject to Spanish Income Tax on their rental income. This applies to both residents and non-residents.