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Owning a Spanish Property

For all properties there are the following commitments to pay when you are a title owner of a property in Spain.

Impuesto Sobre Bienes Inmuebles or “IBI” is a local Town Hall charge and effectively an annual tax. IBI’s are similar to “Rates” in the UK. This is payable irrespective of whether the owner is a resident or not. Calculated on the basis of the cadastral value, this is an administrative value usually lower than the market value, set by the town hall the tax rate goes from 0.4% – 1.1% of the cadastral value l depending on the Spanish region.

Annual Wealth Tax (Impuesto Sobre Patrimonio) Consult your accountant or legal for up to date rates if applicable.

Utility bills – Water and Electric are billed only by consumption of usage: Electricity is billed every two months, after meters have been read. Companies are permitted to make an estimate of your consumption every second period without reading the meter. There’s also a rental charge for the water meter which is approx. 4 Euros per quarter. Water is supposedly safe to drink in all urban areas, but is always better to drink bottled water.

Community charges. If you buy a property on a complex, the communal gardens and swimming pool will be maintained for the community. The costs of their work and staff will be covered by these charges.

Basura – Rubbish Collection tax. This is paid every two months by all property owners to “Diputacion Provincial de Almeria”.

Insurance – you must have a home insurance.

Personal Income Tax (Impuesto sobre la Renta de No Residentes – IRNR) Non-residents who own property in Spain have to pay an annual income tax that varies according to whether the property is rented out or not.

Rental Income: If non-residents rent out their property and receive an income in exchange, they are obliged by law to declare this income and pay taxes on it. The taxable base and the tax rate will be determined by the laws as they apply to each person’s particular circumstances (taking into account the double taxation treaty – if any – between Spain and the country of origin of the non-resident). In many cases non-residents simply pay a flat rate of 25% of the gross income they earn from their property in Spain. If non-resident rent out their property for short terms click on the following for further information. Residents in Spain will have to pay the income tax based on their income earned during the year. The tax rate depends on the level of income.

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