Resident Vs Non Resident When Paying Yearly Property Taxes  in Spain


Non Resident Property Taxes is One of the questions I received when Buyers are asking about yearly Property Taxes.
What is the difference between a resident or non resident yearly property taxes in Spain?.

This is not an easy one.
Usually all agencies talk about IBI (municipal yearly tax) that is paid once a year and the amount
is related with the value of the property. But lets go further…..

A resident can live in the property or he can rent the property. If he rents the property then
an income tax has to be paid over the amount received for rent each year.
The resident can deduct all the expenses the property has during the year.

A non resident, as he is not living in the property, has to pay a minimum income tax, even if he is not renting the property. This is a 24% from  a 1,1% of cadastral value.
If a non resident rents the property then a 24% is applied to total income. As a non resident
is not possible to deduct any expenses.

This is not over, we go further:

– If the owner is not resident buy lives in other Country in Europe, then is possible to deduct
all the expenses the property has.
– Applying the new law (2015) things are getting better for Europeans as income rent tax
is reduced from 24% to a 20% and a 19% in 2016.
– For non European residents the tax was reduced already from 24,75% to 24%.

Cristian de la Torre
Your Real Estate Buyer´s Agent in Spain –