Spanish Property Taxes for Foreign Owners: The Complete Guide (2026)

One of the most common surprises for foreign buyers in Spain is the number of taxes attached to property ownership. Most people budget for the purchase taxes. Far fewer realise that owning a property in Spain creates ongoing annual tax obligations, and that selling will bring a further set of costs with strict deadlines.

This guide covers every Spanish property tax you will encounter as a foreign owner, from the moment you buy to the day you sell. Whether you are an EU national, a UK national post-Brexit, or from the US, Australia or elsewhere, the obligations are real and non-compliance leads to fines and penalties that accumulate quickly. All figures reflect 2026 rates.

Overview: The Three Stages of Property Tax in Spain

Spanish property taxes fall into three clear categories depending on where you are in the ownership lifecycle.

There is also a Wealth Tax (Patrimonio) that can apply to non-residents with significant Spanish assets, and an inheritance tax obligation if the property passes to heirs. Each is covered below.

Taxes When Buying Property in Spain

ITP: Property Transfer Tax in Spain (resale properties)

If you are buying a resale (second-hand) property, you pay ITP tax in Spain. This is the biggest single tax cost for most buyers and must be paid within 30 days of completion. The rate is set by each autonomous community and varies significantly across Spain.

On a 300,000 euro property in Andalusia, ITP alone is 21,000 euros. In Catalonia it could reach 30,000 euros. Knowing the regional rate before choosing where to buy makes a significant difference to your total budget.

IVA and AJD: VAT and Stamp Duty on New-Build Properties

If you are buying a new-build property directly from a developer, you pay IVA (VAT) at 10% instead of ITP. You also pay AJD (stamp duty), set by each region at around 1 to 1.5%. Total purchase taxes on a new-build therefore run to around 11 to 11.5% before notary, registry and legal fees.

You will also need a NIE number before you can complete any property purchase in Spain. Most buyers arrange this through their property lawyer as part of the conveyancing process.

Spanish Property Taxes for Non-Residents: Annual Obligations

This is where many foreign owners get caught out. Owning property in Spain means paying taxes every year, even if you never rent it out and spend only a few weeks there annually. Both of the following are mandatory for non-resident owners.

IBI: Annual Property Tax in Spain

IBI is Spain's equivalent of council tax in the UK or property tax in the US. Every property owner pays it every year without exception. It is collected by your local town hall (Ayuntamiento) and is based on the cadastral value of the property, which is typically set much lower than the market value.

Municipal rates generally range from 0.4% to 1.1% of the cadastral value. In practice, IBI bills for most holiday properties fall between 200 and 800 euros per year, though larger or higher-value properties can be considerably more.

IBI is paid once per year, with deadlines varying by municipality, typically between May and October. Setting up a direct debit from a Spanish bank account is the simplest way to avoid missing payment.

IRNR: Non-Resident Property Tax in Spain

This is the tax that catches most foreign owners completely off guard. Even if your Spanish property sits empty all year and you earn no rental income from it, you are still required to pay annual income tax on it as a non-resident.

The Spanish tax authorities take the view that owning a property provides a personal benefit, and they tax you on a deemed or imputed rental income based on the property's cadastral value. The calculation is:

• 1.1% of the cadastral value is treated as your deemed annual income (2% if the cadastral value has not been updated in the past 10 years)
• You then pay IRNR on that figure at 19% for EU and EEA nationals, or 24% for non-EU nationals including UK nationals post-Brexit

On a property with a cadastral value of 100,000 euros, the deemed income is 1,100 euros. An EU national pays 209 euros in IRNR. A UK or US national pays 264 euros. The sums are modest but the obligation is real. Non-compliance leads to fines and back-tax demands that accumulate over years.

If you are buying specifically as a non-EU national, read our guide to the proposed 100% property tax for non-EU buyers in Spain - it covers who would be affected, what has actually passed into law, and how to approach buying now given the uncertainty.

IRNR on an unrented property is filed annually using Modelo 210, with a deadline of 31 December for each tax year.

IRNR on Rental Income from Your Spanish Property

If you do rent out your Spanish property, the rental income is taxable in Spain as a non-resident at the same rates: 19% for EU and EEA nationals, 24% for non-EU nationals including UK nationals.

EU and EEA nationals can deduct legitimate expenses from their rental income before calculating the tax, including maintenance costs, management fees, mortgage interest, insurance and depreciation. A July 2025 ruling has also opened the door to expense deductions for non-EU investors in certain circumstances. A tax adviser can confirm your position.

Since 2024, rental income must be reported annually rather than quarterly. For income earned in 2026, the annual filing deadline is January 2027.

Capital Gains Tax in Spain for Non-Residents

For a deeper breakdown of the sale calculation, 3% retention and Modelo 210 filing, see our dedicated guide to capital gains tax Spain for non-residents.

When you sell a Spanish property, you pay tax on the profit. For non-residents, capital gains tax in Spain is a flat rate of 19% on the net gain, regardless of nationality.

The gain is calculated as the sale price minus the original purchase price, adjusted for allowable costs including:

• Purchase costs paid at the time (ITP or IVA, notary fees, registry fees, legal fees)
• Costs of any improvements or renovations made to the property. Keep all invoices as these can significantly reduce your taxable gain
• Selling costs including estate agent fees and legal fees

Plusvalia Municipal: The Local Tax on Property Sales

Plusvalia is a local tax charged by the town hall on the increase in the land value of a property between the date it was last transferred and the date you sell it. It is paid by the seller and calculated using the cadastral land value and the number of years of ownership.

Plusvalia is entirely separate from capital gains tax and is frequently overlooked by sellers until the last moment. The amount varies by municipality and duration of ownership. Your lawyer will calculate and arrange payment as part of the sale process.

Since a 2021 Supreme Court ruling, you cannot be charged Plusvalia if you can demonstrate the property sold for less than you paid. Provide your purchase and sale deeds to the town hall to claim this exemption if it applies.

Wealth Tax and Inheritance Tax in Spain

Wealth Tax (Patrimonio)

Spain's Wealth Tax can apply to non-residents who own significant assets in Spain. For non-residents, only assets located in Spain are included. The general tax-free threshold for non-residents is 700,000 euros per person. Above this, Wealth Tax applies on a progressive scale.

Regional rules differ significantly. Madrid and Andalusia both apply a 100% rebate, effectively eliminating Wealth Tax. Other regions apply it in full. For non-residents with Spanish assets above 3 million euros, the national Solidarity Tax on Large Fortunes (ISGF) may also apply even where regional Wealth Tax is rebated. If you are planning to live in Spain, it is worth noting that the Golden Visa has now been abolished - though several strong residency routes remain, including the Non-Lucrative Visa for those with passive income, and the Digital Nomad Visa for remote workers.

Inheritance Tax on Spanish Property

If you own property in Spain and you die, Spanish inheritance tax applies to the Spanish assets regardless of your nationality or where you live. The same applies if you inherit Spanish property from someone else.

National rates range from 7.65% to 34% or more, but the actual tax paid varies enormously by region. Madrid and Andalusia both offer near-100% rebates for close family, reducing the bill to close to zero. Catalonia and the Balearic Islands are considerably less generous.

Making a Spanish will is the single most practical step any foreign property owner can take. It makes the inheritance process significantly faster, cheaper and clearer for your heirs. A Spanish will sits alongside your home-country will and deals specifically with your Spanish assets. For more detail, read our guide to inheritance law in Spain for expats.

Key Deadlines and Compliance Summary

Frequently Asked Questions

Summary

Spanish property taxes are more complex than most foreign buyers expect. The purchase taxes are significant and vary by region. Annual ownership taxes are mandatory even for empty properties. Selling triggers a further set of obligations with deadlines that must be met precisely.

All of this is manageable with the right professional support. A qualified English-speaking tax lawyer or fiscal adviser in Spain can handle your annual IRNR and IBI filings, advise on minimising your capital gains exposure, and ensure you never miss a deadline or face an avoidable penalty. If you are not yet sure what to look for when hiring, our guide to finding an English-speaking lawyer in Spain covers what to check before you commit to anyone.

If you are still in the process of buying, read our guide to the complete process of buying property in Spain as a foreigner for a full overview of what to expect from offer to completion.