Non-Residents Tax in Spain: What You Need to Know

TL;DR: If you own property or earn income in Spain but live elsewhere, you likely need to pay Non-Resident Income Tax (NRIT). Whether you rent your property or use it as a second home, Spain considers it taxable. Returns are filed annually (or quarterly if rented) using Modelo 210, with rates of 19% for EU/EEA residents and 24% for others.

Pro tip: Even if you don’t rent out your property, you must still declare “deemed” rental income. Filing late or incorrectly can lead to penalties—so consider hiring a professional.

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If you own property or have other taxable assets in Spain but don’t live there full-time, you may be liable to pay Non-Resident Income Tax (NRIT). Understanding your tax obligations is essential to avoid fines and penalties. In this post, we’ll explain the basics of non-resident tax in Spain, who needs to pay, and how to file your returns efficiently.

What is Non-Resident Income Tax (NRIT)?

Non-Resident Income Tax is a tax levied on income generated in Spain by individuals who do not qualify as tax residents. Unlike Spanish residents who pay income tax on their worldwide income, non-residents are only taxed on income obtained in Spain. This tax is primarily applicable to:

Property owners who use their property as a second home or rent it out.
Individuals who earn income from Spanish sources (e.g., dividends, savings, or pensions).

Who Needs to Pay Non-Resident Tax in Spain?

You are considered a non-resident for tax purposes in Spain if you meet any of the following conditions:

You spend fewer than 183 days per year in Spain.
Your primary business or professional activities are not based in Spain.
Your primary residence or financial interests are located outside of Spain.

If you fall under any of these categories but own property in Spain, you must file a non-resident tax return.

How is Non-Resident Tax Calculated?

The tax you owe depends on how your property in Spain is used:

If you rent out your property:
You must declare the actual rental income received. The tax rate for residents of EU, EEA, or countries with a tax treaty is 19%, while for others, it’s 24%. You can deduct certain expenses like mortgage interest and maintenance costs if you are an EU resident.
If your property is used as a holiday home:
Even if you don’t rent out your property, the Spanish tax authorities consider that it generates “deemed” income. This “notional” rental income is calculated as 1.1% of the cadastral value (a government-assigned property value) or 2% if the cadastral value has not been updated in the last 10 years.

Example Calculation:

Suppose your property has a cadastral value of €100,000, and you use it as a second home:

1.1% of €100,000 = €1,100.
The taxable income would be €1,100.
For non-EU residents, the tax would be: €1,100 x 24% = €264.
For EU residents, the tax would be: €1,100 x 19% = €209.

When to File Non-Resident Tax Returns

Non-resident tax returns must be filed once a year using form Modelo 210. The filing deadline depends on whether your property was rented or not:

If rented: Returns must be filed quarterly, by the 20th of April, July, October, and January.
If not rented: The tax return for the entire previous year must be submitted by December 31st.

How to File Non-Resident Tax in Spain

You can submit your tax return online via the Spanish Tax Agency’s website (Agencia Tributaria), or you can hire a tax advisor to handle the process on your behalf. Many non-residents find the online system challenging, especially if they don’t speak Spanish, so professional assistance is highly recommended.

Common Pitfalls to Avoid

Failing to declare deemed rental income: Many non-residents are unaware they need to declare their property even if it’s not rented out.
Late filing penalties: If you miss the filing deadline, you may incur late fees and penalties, which can add up quickly.
Incorrect deductions: Only EU residents can deduct certain expenses, and not all costs are deductible.