Most guides to property tax in Spain for non residents explain the purchase taxes and stop. That leaves out the bill that surprises almost every foreign owner: Spain taxes you every year you own the property, even if it sits empty and earns nothing. Here are all three tax moments — at purchase, every year of ownership, and at sale — with the 2026 rates and the traps that cost real money.
Buying to let as a non-EU owner? The number that changes everything: 24% tax on gross rent, no deductions — UK and US owners included. Details in Moment 2.
Rates and figures last verified: July 2026 — confirm current rates before you sign.
Moment 1: what you pay when you buy
Buying resale, you pay ITP (transfer tax), set by the region. Buying new from a developer, you pay IVA at 10% plus AJD (stamp duty, roughly 0.75–1.5% in most regions) instead. On top of either: notary, land registry, and gestoría fees, typically another 1–2%.
ITP is where identical budgets buy different amounts of house. Across the seven markets we cover:
| Market | Region | ITP on resale (verified July 2026) |
|---|---|---|
| Madrid | Madrid | 6% |
| Costa del Sol | Andalucía | 7% flat |
| Canary Islands | Canarias | 6.5% (and new build pays IGIC at 7%, not 10% IVA) |
| Costa Blanca | C. Valenciana | 9% up to €1M, 11% on the whole price above (the 9% cut from 10% took effect 1 June 2026) |
| Barcelona · Costa Brava | Catalonia | 10% to €600k · 11% to €900k · 12% to €1.5M · 13% above (4-band scale since June 2025 — now the highest ceiling in Spain; large-portfolio “gran tenedor” buyers pay 20% flat) |
| Balearic Islands | Baleares | 8% ≤€400k · 9% ≤€600k · 10% ≤€1M · 12% ≤€3M · 13% above |
The spread is not academic: on a €700,000 resale purchase, Madrid charges €42,000, Barcelona roughly €71,000 on the tiered scale. If you are choosing between two coasts, the transfer-tax line belongs in the comparison alongside the price per square meter. And note the churn: these rates changed twice in the last twelve months (Catalonia June 2025, Valencia June 2026) — verify your region’s current rate the week you sign, not from a guide, including this one.
Rule of thumb for total acquisition costs: 10–13% on top of the price in most regions (Madrid and the Canaries sit lower), which is the figure to plug into the cash plan next to your mortgage equity — see our non-resident mortgage guide for how the two interact.
Moment 2: what you pay every year you own it
This is the section to read twice, because two of these three lines arrive whether or not the property earns a cent.
IRNR imputed-income tax — the one nobody expects. Spain deems your empty (or personally-used) property to produce fictional income and taxes it annually. The math: 1.1% of the cadastral value (2% if the municipality’s values haven’t been revised in the last 10 years), taxed at 19% for EU/EEA residents and 24% for everyone else. Worked example: cadastral value €150,000 (typically well below market value), revised recently → imputed income €1,650 → a UK or US owner pays €396/year, an EU owner €313. Filed on Form 210, due the following calendar year. Small numbers, but unfiled years accumulate and surface at sale, with surcharges.
IBI — the municipal property tax. 0.4–1.1% of cadastral value, billed by the town hall. The seller owes the year of purchase (by Supreme Court doctrine the parties can split it — put it in the contract); after that it’s yours. Set up a direct debit: unpaid IBI attaches to the property, not the person.
Rental income tax, if you let it — where your passport matters most. EU/EEA owners pay 19% on net rental income and deduct the real costs (IBI, community fees, insurance, mortgage interest, depreciation, pro-rata). Non-EU owners — including British and American — pay 24% on gross rent, no deductions at all. A UK owner collecting €1,500/month with €500/month of costs pays tax on €18,000, not €12,000: €4,320/year versus the €2,280 an EU neighbor pays on the identical flat. This asymmetry alone changes rental-yield math and belongs in any buy-to-let decision before you offer.
Wealth tax — skip this one below ~€1.4M bought jointly. Non-residents get the national €700,000 allowance per person on Spanish assets (plus regional variations; Madrid and Andalucía offer full regional relief, though the national “solidarity tax” still catches larger holdings — with the €700k allowance stacked first, it bites in practice from roughly €3.7M of net Spanish wealth). For a typical €250k–€1M purchase held by a couple, this usually rounds to zero — but check before buying above €1.4M jointly.
Moment 3: what you pay when you sell
Capital gains: 19% flat for non-residents on the gain, with documented purchase costs and improvement works added to your acquisition cost — keep every invoice from day one; a renovation without invoices is a renovation the tax office says never happened.
The 3% retention. The buyer of your property is legally required to withhold 3% of the full sale price and pay it straight to the tax office (Form 211) as an advance on your gains tax. You then file Form 210 within four months: if the real tax due is less than the retention, you claim the difference back (refunds take months, sometimes over a year); if more, you pay the difference. Sellers who never filed their IRNR years discover them here — the refund gets held up against unfiled returns.
Plusvalía municipal. A town-hall tax on the increase in the land’s cadastral value while you owned it. Since the 2021 reform you can choose between two calculation methods (the objective cadastral formula or the real gain shown by your purchase and sale deeds — pick whichever is lower) and owe nothing if you sell at a documented loss. But the exemption isn’t automatic: you must file with the town hall and attach both deeds to prove the loss, not just skip the tax.
The traps, in one list
- Unfiled IRNR years. The annual imputed-income filing is easy to miss for a decade and expensive to regularize at sale. File from year one.
- Gross-rent taxation for non-EU owners. Run your yield numbers at 24% of gross before buying to let. (Post-Brexit, this caught many British owners by surprise.)
- The cadastral revision gotcha. Whether your municipality revised values within 10 years decides 1.1% vs 2% — an 80% difference in the annual bill. Ask, don’t assume.
- Regional ITP drift. Rates move — twice in the last year alone (Catalonia’s 4-band scale in June 2025, Valencia’s cut to 9% in June 2026). Verify the current rate for your region in the week you sign, not from a guide — including this one.
- Missing invoices at sale. Every improvement invoice you keep reduces the taxed gain by 19% of its value.
Property tax in Spain for non residents — quick answers
How much tax do I pay when buying property in Spain?
On resale, a regional transfer tax of 6–13%: Madrid 6%, Andalucía 7%, Valencia 9% up to €1M, Catalonia tiered from 10% to 13%. Add roughly 1–2% in notary, registry, and gestoría fees. On new builds you pay 10% IVA plus stamp duty instead — the Canaries charge 7% IGIC rather than IVA.
Do non-residents pay annual tax on Spanish property?
Yes, even if it’s empty. The IRNR imputed-income tax charges 19% (EU/EEA) or 24% (everyone else) on 1.1–2% of the cadastral value, filed yearly on Form 210. Add IBI, the municipal property tax of 0.4–1.1% of cadastral value. Rental income is taxed separately if you let the property.
What is the 3% retention when selling?
The buyer must withhold 3% of the sale price and pay it directly to the Spanish tax office as an advance on your capital gains tax. You file Form 210 within four months to settle the real amount — refund if you owed less, top-up if more. Unfiled prior-year taxes delay the refund.
Is rental income taxed differently for EU and non-EU owners?
Substantially. EU/EEA residents pay 19% on net income after deducting real costs. Non-EU residents — including UK and US owners — pay 24% on gross rent with no deductions, which can roughly double the effective tax on the same property.
If you want it handled
None of these taxes is negotiable, but several are plannable: which region you buy in, how the property is held, whether your yield math survives 24%-on-gross, and whether year-one filings actually happen. Our viability check runs this arithmetic on every shortlisted property before you offer — purchase taxes, the annual IRNR and IBI line, and the realistic net yield for your passport — and we flag the Form 210 filings most owners forget, for your tax adviser to file. Running that check before the offer rather than after is the practical case for a buyer’s agent in Spain. Buyer-exclusive representation and, if you want us to search, a search of the whole market that you follow live in your client portal. Already found the property? We start with due diligence.
Book a Strategy Call — 30 minutes. We’ll run the numbers for your specific situation and region.