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Non-Resident Taxation Manual (July 2024)

Imputed income from urban real estate

Internal regulations

Regulations: Article 13.1.h) Law IRNR

According to internal regulations, non-resident taxpayers who are natural persons , owners of urban properties located in Spanish territory, used for their own use not affected by economic activities, or vacant, are subject to Non-Resident Income Tax on the imputed income corresponding to those properties.

Agreement

In accordance with the Conventions for the avoidance of double taxation, income obtained from real estate may be subject to taxation in the State in which the real estate is located, whether it derives from the direct use or enjoyment, or from the leasing or any other form of exploitation of the same.

Taxation

Regulations: Articles 24, 25 and 26 of the IRNR Law

The taxable base corresponding to the imputed income from urban real estate located in Spanish territory will be determined in accordance with the IRPF regulations. For these purposes, the amount resulting from applying the percentage corresponding to the cadastral value of the property, which appears on the Real Estate Tax (IBI) receipt, must be computed as income:

  • Properties located in municipalities in which the cadastral values have been revised, modified or determined through a general collective valuation procedure, in accordance with cadastral regulations, and have come into force in the tax period or within the period of the ten previous tax periods: 1.1% (the year of collective valuation of a general nature of a Municipality can be consulted in the Value Reports section of the Portal of the General Directorate of Cadastre, https://www.catastro.meh.es )

  • Remaining properties: 2%

Taxes are paid based on the aforementioned tax base, without deducting any type of expense.

The resulting amount is understood to refer to the entire calendar year. It will be reduced proportionally to the number of days, when the property has not been owned for the entire year, or when it has been rented for part of the year.

If on the date of accrual of the tax (December 31) the properties do not have a cadastral value or this has not been notified to the owner, the imputation base will be taken as 50% of the highest of the following values: the price, consideration or acquisition value of the property, or the value of the property verified by the Administration for the purposes of other taxes. In these cases, the percentage will be 1.1%.

In the case of properties under construction and in cases where, for urban planning reasons, the property cannot be used, no income will be estimated.

In the case of rights to use real estate in turn, the imputation will be made to the owner of the real right, prorating the cadastral value based on the annual duration of the use period. If on the date of accrual of the tax the properties do not have a cadastral value, or this has not been notified to the owner, the acquisition price of the right of use will be taken as the basis for imputation. The imputation of real estate income will not apply to the holders of rights to time-share use of real estate when its duration does not exceed two weeks per year.

In cases where ownership belongs to several persons, the income corresponding to the real estate or real right of enjoyment in question will be considered to be obtained by each of them in proportion to their participation in said ownership.

The tax rate is the general one in force:

  • Residents EU , Iceland, Norway and, since 07-11-2021, Liechtenstein: 19%
  • Rest of taxpayers: 24%

Deductions: Only the following may be deducted from the tax rate:

Deductions for donations, under the terms provided for in the Personal Income Tax Law and in the Law on the tax regime of non-profit entities and tax incentives for patronage.