Taxes for Property Owners in Spain
A clear, complete and structured tax overview
Taxes are an integral part of property ownership in Spain. This section explains which taxes apply at purchase, during ownership, and upon resale, with particular focus on foreign buyers who are not tax residents in Spain.
Taxes at purchase
Resale property:
7% transfer tax (ITP)
(may vary slightly by region)
New development:
10% VAT (IVA)
1–1.5% stamp duty (AJD)
Ongoing taxes during ownership
IBI – Municipal property tax
Annual municipal tax
Based on the cadastral value (valor catastral), not market value
Varies by municipality
Basura – Waste collection fee
Municipal waste collection charge
Usually paid once or twice per year
IRNR – Non-resident income tax
Applies even if the property is not rented.
Spain calculates a deemed rental income based on the cadastral value.
Tax rates:
EU/EEA residents: 19%
Non-EU residents: 24%
Example:
Cadastral value: 200,000 EUR
Deemed income: 2,200 EUR
Tax (EU resident): 418 EUR per year
For rental income
EU residents are taxed on net profit (deductions allowed)
Non-EU residents are taxed on gross income (no deductions)
Wealth Tax / Solidarity Tax
(particularly relevant for high-value properties)
Spain applies an annual Wealth Tax (Impuesto sobre el Patrimonio) and, for very large fortunes, an additional Solidarity Tax on Large Fortunes.
These are not transaction taxes. They are recurring annual taxes payable as long as the property is owned.
Who is affected
Foreign owners who are not Spanish tax residents
Taxed only on assets located in Spain (e.g. Spanish property)
Applies when net Spanish assets exceed
700,000 EUR per person
Mortgages and debts linked to the property are deductible.
Tax base
Calculated on net asset value as of 31 December each year
The tax is progressive
Andalusia effectively applies the state tax scale
(unlike Madrid, which offers broad exemptions)
Wealth tax rates – state scale (non-residents)
Taxable Spanish assets (after 700,000 EUR allowance)
Up to approx. 167,000 EUR
167,000 – 334,000 EUR
334,000 – 668,000 EUR
668,000 – 1.34 M EUR
1.34 – 2.67 M EUR
2.67 – 5.35 M EUR
5.35 – 10.7 M EUR
Over approx. 10.7 M EUR
Marginal rate
0.2%
0.3%
0.5%
0.9%
1.3%
1.7%
2.1%
up to 3.5%
Rates are applied progressively, not as a single percentage on the full value.
Real-world example – 10 M EUR property
Property value:
10,000,000 EUR
Allowance (non-resident):
–700,000 EUR
Taxable base:
9,300,000 EUR
Estimated annual wealth tax:
≈ 170,000 – 185,000 EUR per year
Effective average tax rate: approx. 1.8–2.0%
The tax applies every year until the property is sold.
Key planning considerations
Joint ownership (e.g. 50/50) provides 700,000 EUR allowance per owner
Wealth tax is often the largest recurring tax cost for properties above 5–10 M EUR
Applies regardless of whether the property is used privately or rented
Taxes upon sale
Capital gains tax
19–28%, depending on the level of profit
Plusvalía Municipal
Municipal tax on the increase in land value
Typically paid by the seller
Total cost overview
Resale properties: approx. 10–13%
New developments: approx. 13–15%
Ongoing costs
IBI
Basura
IRNR
Potential wealth / solidarity tax
Auriga ensures that the full long-term tax picture — not only purchase taxes — is clearly understood before any property acquisition is completed.
