HomeAway, AirBnb and other property portals and estate agencies have been busy informing their clients they will disclose all their tax details over to the Spanish Tax Office in 2019, retroactively as from the 1st of Jnauary 2018. Are you up to date with your Spanish taxes? Have you been declaring and paying tax in Spain on your rental income? We file taxes all over Spain.

Blog post copyrighted © 2018 and 2019. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Lawyer – Abogado
7^th of January 2019

You may have received last December 2018 an email from your property portal or estate agency similar to this one.

Property portals have been scrambling to send frantic emails over the last month to expat clients (‘hosts’, in their terminology) informing them that going forward they will be passing on all their tax details over to the Spanish Tax Authorities as from the 1^st of January 2019. They will request you complete a tax form that will be relayed over to the tax office. If you fail to comply, you will no longer be allowed to do business with them.

So what does all this even mean? It means that estate agents and property portals have been forced to turn into whistleblowers reporting all your rental income under threat of heavy fines.

The reason is because new tax laws now force estate agents and property portals to pass on all your (rental) tax details over to the Spanish Tax Office under threat of humongous fines up to €600,000. Property portals and agents must submit a new quarterly tax form (number 179) to the tax Authorities with very detailed information on all their client’s rentals. If you have been renting out in Spain your property over the last year, and have not declared and paid tax on your income, chances are the tax office already knows about it and you are going to be fined.

The details passed on to the tax Authorities will be retroactive as from the 1^st of January 2018. However, this does not preclude the fact that the Spanish Tax Office is entitled to collect taxes going back four years (statute of limitations).

In Spain, when you rent out a property you are taxed at source.

In other words, you need to declare and pay taxes on your rental income in Spain, not elsewhere i.e. in your home country. Depending on whether there is a double taxation treaty in force with your home country (i.e. such as with the UK and the RoI), your national tax office will give you tax breaks on the tax you have already paid in Spain.

On being non-resident and owning property in Spain, you are liable for the following two taxes:

• As a non-resident, when you own property in Spain you should be paying an annual end-of-year tax called Non-Resident Imputed Income Tax (even if you do not rent out your property). More information on this tax here: Non-Resident Imputed Income Tax (Fiscal Representation Service) – 8th October 2018
• If you do rent out your Spanish property, either long-term or as a holiday letting, you must file in addition to the above, a quarterly income tax declaration. Generous landlord tax relief is available for all EU-residents. More information on this quarterly income tax here: Holiday Rental Taxation in Spain – 8th July 2018.

The most interesting part of our taxation service is that if you are EU-resident we can bring down your tax bill by an average of 70%. Ask us.

We offer two different taxation services which are very competitively priced. The service is provided always by native English-speaking lawyers and economists.

Fines for non-payment of tax on rental income range from 50 to 150% of the undeclared amounts, plus delay interests.

Any unpaid tax can be placed as a charge against your Spanish property.

If you are not up to date with your Spanish taxation, don’t procrastinate any longer; contact us ASAP and see how we can help you out. Be pro-active, do not allow the Spanish taxman slap you a huge fine in 2019!

We offer the most competitive fees in the market. We file taxes all over Spain.

Non-Resident Imputed Income Tax (Fiscal Representation Service) €90/year

Holiday Rental Accounting Service (HRAS) €100/tax quarter

We are specialized in taxation

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, conveyancing, inheritance and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form.

Tax & legal services available from Larraín Nesbitt Lawyers:

• Non-Resident Income Tax (Fiscal Representation) from €90
• Holiday Rental Accounting Service (HRAS) from €100
• Registration of Holiday Homes (Andalusia)

Holiday lettings-related articles

• Holiday Rental Laws in Spain – 8th of March 2015
• Non-Resident Taxes in Spain – 8th December 2015
• Holiday Rental Laws in Andalusia (Decree 28/2016) – 8th of February 2016
• Renting in Spain - Landlord´s Taxation – 8th of January 2017
• Holiday Home Taxation in Spain – 8th of July 2017
• Holiday Rentals in Andalusia Made Easy – 3^rd July 2017
• Non-Resident Income Tax – 8^th December 2017
• Holiday Rental Taxation in Spain – 8th July 2018
• Renting in Spain: are you still overpaying income tax every quarter? – 16^th October 2018
• You are taxed at source on renting out in Spain – 30^th November 2018
• Did you get an email from AirBnb over your Spanish tax details? – 21st December 2018
• Important information from the Spanish Ministry of Finance – 7^th January 2019

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.019 © Raymundo Larraín Nesbitt. All rights reserved.