Letting a Spanish property means paying Spanish tax on the income. As a UK owner you are almost always treated as a non-resident, which means you pay tax in Spain on what the property earns.
How it is charged #
As a non-EU resident you pay non-resident income tax at 24 per cent.
Here is the part that matters most, and the part that most articles written for EU buyers get wrong for you: as a non-EU resident you cannot deduct your costs.
An EU owner pays 19 per cent on net income, after deducting maintenance, insurance, community fees, utilities, management fees and mortgage interest. A UK owner pays 24 per cent on the gross rent, with none of those deductions.
What that does to the numbers #
Take a property producing €18,000 of gross rental income a year, with €6,000 of running costs.
An EU owner is taxed on €12,000 at 19 per cent, so €2,280.
A UK owner is taxed on €18,000 at 24 per cent, so €4,320.
Same property, same tenants, nearly double the tax. This is not a reason not to buy, but it is a reason to build the real number into your projections rather than a figure lifted from a Dutch or German source.
Filing #
Returns go on Modelo 210. Since 2024 non-residents can group a year’s rental income into a single annual return, filed in January for the preceding year, where previously it was quarterly.
Note that you also need to file even in a year with no rental income, because the notional income tax on an unlet property still applies for the periods it was empty.
Late filing attracts penalties.
When you are liable #
From the moment you receive income from letting Spanish property. It applies equally to short-term holiday letting and to long-term letting. The type of let makes no difference to the liability, though it makes a considerable difference to the licensing.
Do not forget the UK side #
Spanish tax is not the end of it. As a UK resident you are taxed on your worldwide income, so the rental income also goes on your self assessment return. You then claim Foreign Tax Credit Relief for the Spanish tax already paid, so you are not taxed twice on the same income.
Where UK tax on the income exceeds the Spanish tax, you pay the difference in the UK. The credit is limited to the amount of UK tax due on that income.
Practical points #
Keep careful records of income and costs, even though the costs are not deductible in Spain, because they are relevant to your UK return and to your eventual capital gains calculation.
Check whether you need a tourist licence before you let. Consider a local tax adviser, particularly with multiple lets. And do not treat the Spanish and UK filings as separate exercises, because they have to line up.
In short #
Letting produces income and obligations in two countries. Keep the records straight and file on time and it stays manageable.
The interaction between Spanish and UK tax on rental income is genuinely complex. This article is general information, not tax advice. Have your own position reviewed by an adviser who knows both systems.
Last reviewed 2026-08-24
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