Did you know in Spain, you have to pay taxes even if your property is vacant?
If you are a non-tax resident in Spain and own properties, we explain the key points to understand your tax obligations and avoid penalties from the Tax Agency.
In this news article, provided by Global Mind Advisors, we offer a comprehensive guide to determine if you have to pay this tax.
The first question you should ask yourself is the following:
Have you had the property at your disposal for 1 day or more during the year?
- If the answer is negative, you do not have to file this tax.
- If the answer is affirmative, we will guide you step by step on how to calculate it.
1. Determination of the tax base.
The tax base will be determined following the regulations of the IRPF (Personal Income Tax), with which we will obtain the amount of deemed income on which the tax authorities consider we have to pay taxes.
The formula is as follows:
Taxable base = Vacant days x cadastral value x %
- Vacant days: Calculate the number of days the property, being in our ownership, has been at the owner’s disposal.
- Cadastral value: The easiest way to obtain the cadastral value is through the last property tax receipt (IBI) or, if the property is a recent purchase, in the cadastral note of the purchase deed.
- % to apply:
- Properties located in municipalities where cadastral values have been reviewed within the last ten years: 1.1%.
- Other properties: 2%.
If there is more than one owner, each of them must declare this tax based on their percentage of ownership.
2. Tax to apply:
Once we have the taxable base, we can calculate the tax to be paid, which will depend on the country of residence of the Non-Resident owner.
- EU residents, Iceland, Norway: 19%.
- Other taxpayers: 24%
3. Frequency and deadlines.
This tax is declared annually using form 210 for Non-Resident Income Tax, before December 31 of the year following the one being declared.
For example, if we declare for 2023, we have until December 31 2024 to submit the tax return.
Conclusion.
It's important to have good advice to comply with your tax obligations and thus avoid penalties from the Tax Agency.
For more information or tax advice, feel free to contact us with no obligation.
We will be happy to assist you.
