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Big News for Non-EU Property Owners in Spain:
Tax Rules Have Changed

If you’re a non-EU resident renting out property in Spain, there’s some excellent news. A recent Spanish court ruling (July 2025) has changed the way you’re taxed – and it could save you a lot of money. British citizens and other non-EU/EEA individuals who have rented out property in Spain can now deduct eligible expenses and recover overpaid taxes. If you would like help re-filing your Modelo 210 and claiming back previous year’s taxes, contact us.

Reclaim Property Income

Deductible Expenses for Non-EU Residents Renting Property in Spain

Up until now, if you were a non-EU landlord in Spain, you had it pretty rough:

  • You were taxed 24% on your gross rental income (that’s before expenses).
  • You couldn’t deduct any costs, such as maintenance, repairs, insurance, mortgage interest, or property management fees.

Meanwhile, EU and EEA landlords paid only 19% on their net income (after expenses). Pretty unfair, right?

What Changed in 2025?

In July 2025, Spain’s National Court ruled that this system was discriminatory. From now on:

  • Non-EU residents can deduct rental expenses, just like EU/EEA residents.
  • You’ll pay 24% tax on your net income (income after expenses), instead of 24% on your gross income.

This means you’ll finally be taxed fairly, based on what you actually earn – not on an inflated number that ignores your real costs.

Spain New rental tax rules

What Expenses Can You Deduct?

Just like EU landlords, you can now subtract legitimate expenses such as:

  • Mortgage interest
  • Local property tax (IBI)
  • Insurance premiums
  • Utilities (if you pay them)
  • Repairs and maintenance
  • Property management or agency fees

Keep good records and receipts – you’ll need them when filing your taxes.

What This Means For You

  1. Accurate Deductions Now Allowed
    Non-EU landlords can deduct legitimate expenses—just like EU counterparts—when filing Modelo 210.
  2. Potential for Refunds
    If you’ve been taxed on gross income previously, you may now request rectifications of past declarations and claim refunds for unfair overpayments.
  3. Track & Document Expenses
    Gather invoices for repairs, insurance, mortgage interest, IBI, utilities, etc. Proper documentation is critical.
  4. Filing Still via Modelo 210
    As of 2024, non-resident landlords can group their rental income annually, rather than filing quarterly. The deadline is from January 1 to January 20 of the year following the accrual.
  5. Supporting Documentation
    Supporting documentation (e.g., invoices, contracts, payment records) will be required.

What About Past Payments?

If you’ve been paying 24% on your gross rental income in recent years, you may be eligible for a refund. Non-EU/EEA taxpayers may now request rectification of prior IRNR filings and claim refunds for undue payments for any non-prescribed tax years (currently: 2021–2024).

Claims must be submitted to the Spanish Tax Agency (Agencia Tributaria) via formal rectification requests. If you would like help re-filing your Modelo 210 and claiming back previous years’ tax, contact us today.

The Bottom Line

This is a major win for fairness. The July 2025 ruling means that non-EU landlords renting out property in Spain will no longer pay tax on gross income, and can now offset legitimate expenses.

Next Steps:

  1. Start tracking all your rental expenses.
  2. File correctly using Modelo 210.
  3. Look into possible refunds for past overpayments.

The days of paying 24% on gross income are over – who’s got the champagne?

Reclaim Property Taxes
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