What taxes could you have to pay in Spain?August 10th 2018
Imputted Income Tax
In Spain this type of income tax is only applicable to people who are not residents of Spain, or you own property in Spain. In addition, if you have a property that is exclusive and for personal use and it is not being rented out, you will need to pay this tax. You will also be expected to pay the imputted income tax even if you do not receive an income from the property. The Spanish tax authorities still believe the owner of the property is benefitting from having a property in Spain.
The minimum taxable value for property in Spain is 2% of the total value of the property, or 1.1% if the cadastral value has been amended since January 1994. Currently the tax rate is 24%, which is a reduction by 0.75% for 2012 and 2013.
Before 2008 if you were not a resident of Spain you had to pay wealth tax, as well as paying income tax. However, non-residents who own holiday homes only have to pay non-resident income tax on their property. Prior to this, if you were to own a property worth €450,000 the villa would cost €1,414 in taxes annually. This is because non-residents received neither individual allowance or a principal residence deduction on the property.
Unless your property is over €700,000 you will not have to pay the wealth tax. If you are a resident of Spain there is a €300,000 allowance against your property.
Non-residents do not get principal home relief because the property isn’t their main residence. However, non-residents do get the same annual allowance as residents. This is due to the EU who encouraged Spain to treat non-residents more equally on their income tax for capital gains and rental income tax.