When tax planning matters
Cross-border tax planning becomes critical at four moments: purchase of Spanish property, relocation to Spain, sale of Spanish property, and inheritance. Each moment has its own tax decisions. Doing nothing means default treatment which is often the most expensive option.
Common tax exposures for foreign owners
- IRNR (non-resident income tax) — on rental income (19% EU/EEA, 24% non-EU/EEA) and imputed income on personally-used properties (~1.1% of cadastral value × 19% or 24%).
- Modelo 720 — disclosure of foreign assets above €50,000 for Spanish tax residents.
- Wealth tax (Patrimonio) — applicable on net wealth above regional thresholds (€500,000–€700,000 typical).
- Solidarity Tax (Impuesto Temporal Solidaridad) — for higher net wealth tiers.
- Capital gains tax on sale — 19% for non-residents.
- Plusvalía Municipal — municipal land value tax on sale.
Beckham Law for relocators
The Beckham Law (Régimen Especial para Trabajadores Desplazados) allows qualifying expats moving to Spain to opt for a 24% flat tax on Spanish income up to €600,000 (vs. progressive IRPF up to 47%) for 6 years. Eligibility is strict: cannot have been Spanish tax resident in previous 5 years, must move for employment or director role, election must be made within 6 months of becoming Spanish tax resident.
Double tax treaty considerations
Spain has double tax treaties with all major countries. The treaty determines which country has primary taxing rights on each income type (employment, dividends, capital gains, real estate income) and provides relief mechanisms (credit, exemption). We map the treaty position for each client to model net tax outcome.
Pre-arrival planning
The most valuable tax planning happens 6–12 months before becoming Spanish tax resident. Decisions like timing of share sales, pension lump sums, asset structures, and trusts can save significant tax versus default treatment. We coordinate with home country tax advisors to deliver a coherent plan.