Taxes affect each tax payers depending on one's status of residency in Spain. Property owners who stay in Spain for more than six months within a year will be classified as residents however it will be advisable to obtain a fiscal certificate from the Hacienda or the tax office to confirm the residency for tax purposes.
Individuals or couples who own properties for holiday or vacation purposes in Spain would be classified as non-residents and as a result, different taxes are to be paid, collectively known as the Non-resident tax.
Non Resident Tax
The non-resident tax is composed of two parts. The first part is the tax on wealth assets which is commonly applied to the properties' deed price multiplied by a gradual tax rate. The second part of the non-resident tax is the Tax on the Imputed Income of the Property. The tax is calculated by multiplying the Cadastral Value of the property by a percentage and by the number of days the property is owned. Adding both taxes (wealth tax and the imputed income tax) makes up the non-resident tax.
The non-resident tax should be filed and paid every year using the form 214 and each name that appears on the deed should file separate forms. Taxes are to be divided based on the numbers of the owners on the deed.
For non-residents who own two or more properties in Spain, a different form for filing the tax must be used and a fiscal representative is required.
Property Related Taxes
Another form of tax that must be paid by a non-resident property owner in Spain is the IBI tax or the SUMA tax which is similar to the local council tax in the U.K. This is based on the property’s price, location, etc. The tax must be paid yearly and setting up of direct debit is advisable to avoid penalties for late payments.