Category: Residency & tax
If you own a home on the Costa del Sol but live in the UK, Ireland or elsewhere in Europe, there is one Spanish tax that catches many owners out. It has nothing to do with buying or selling, and it is due even if the property is never let. This is the annual non-resident property tax in Spain, and the return for 2025 must be filed and paid by 31 December 2026.
The good news is that the amount is usually modest – typically a few hundred euros a year – and the rules are simple once explained. Here is what you need to know, including the changes to the calendar that start next year.
The tax that catches out holiday-home owners
Spain assumes that a home you keep for your own use has a value to you, even when no rent comes in. So if you are not tax-resident in Spain and your property is used by you and your family, or simply stands empty, the Agencia Tributaria (Spain’s tax office) treats it as earning a notional, or “imputed”, income each year. That income is taxed under the Non-Residents’ Income Tax and declared on form modelo 210.
This sits alongside the local IBI council tax you already pay to the town hall. It is a separate return to the national tax office, and it is easy to miss because no bill arrives: it is up to the owner, or their adviser, to file it.
How non-resident property tax in Spain is worked out
The calculation starts with the cadastral value (valor catastral) shown on your IBI receipt. This is an official administrative value, not the price you paid – and it is deliberately set low. Under the rules for cadastral valuations, a “market relation” coefficient of 0.5 is applied, so a cadastral value is designed to be around half of market value at most. Because many towns last revised their values years ago, while prices have since risen, it is often well below half of what a home would sell for today.
So the tax is worked out on a figure that is a fraction of your home’s real value. Then:
- Imputed income is 1.1% of the cadastral value where the town’s values have been revised in recent years (for 2023–2025, valuations in force from 1 January 2012 onwards), or 2% where they have not.
- The tax rate is 19% for residents of the EU, Iceland, Norway and Liechtenstein – so Irish, Dutch, Scandinavian or German owners, for example – and 24% for everyone else, including UK residents.
- Only part of the year? The amount is reduced pro rata if you bought or sold during the year, or if the home was let for part of it.
- Joint owners each declare their own share. A garage or storeroom with its own cadastral reference counts as a separate property.
No expenses can be deducted against this imputed income; the only deductions allowed are for qualifying donations.
A worked example
Take an apartment bought for €450,000 whose IBI receipt shows a cadastral value of €150,000 – a third of the purchase price – in a town whose values have been revised. It was owned for the whole of 2025 and not let. The figures below are purely illustrative; your own cadastral value is on your IBI receipt.
| EU/EEA resident owner | UK resident owner | |
|---|---|---|
| Purchase price (for comparison) | €450,000 | €450,000 |
| Cadastral value (from the IBI receipt) | €150,000 | €150,000 |
| Imputed income (1.1% of the cadastral value) | €1,650 | €1,650 |
| Tax rate | 19% | 24% |
| Tax for the year | €313.50 | €396 |
| As a share of the purchase price | about 0.07% | about 0.09% |
In other words, for a €450,000 home the annual bill in this example is a few hundred euros – less than 0.1% of what the owner paid. If a couple own the apartment 50/50, each files their own return for half of these amounts.
Key dates – and what changes from 2027
For the 2025 tax year nothing has changed: the imputed-income return can be filed at any time during 2026 up to 31 December 2026. If you want the tax paid by direct debit from a Spanish bank account, the return must go in by 23 December.
From next year the calendar moves. Under Orden HAC/623/2026, published in Spain’s Official State Gazette (BOE) on 23 June 2026, the tax office has redesigned the non-resident forms and deadlines:
- Imputed income: starting with the 2026 tax year, the filing window opens on 1 April rather than 1 January and still closes on 31 December of the following year. So your 2026 return can be filed from 1 April to 31 December 2027 (direct debit up to 23 December).
- Rental income: owners who group their rental income into one annual return will file the 2026 return between 1 and 20 April 2027 (direct debit 1–15 April).
- New boxes: returns filed from 1 January 2027 will ask for the number of days the property was held and each owner’s percentage share.
If you rent it out, buy off-plan or sell
Letting: for the days a property is let, you are taxed on the actual rent instead of the imputed income, on a separate return. Rules on deductible expenses differ for EU/EEA and other owners, so take advice before you start letting.
Buying off-plan: no imputed income applies while a home is still under construction. The obligation begins once your completed home is yours – one more reason to understand how off-plan purchases work from deposit to keys.
Selling: when a non-resident sells, the buyer must withhold 3% of the price and pay it to the tax office on account of the seller’s capital gains tax. Up-to-date returns make that process smoother.
Missed a year? Don’t panic, but don’t wait
Returns filed late but voluntarily – before the tax office writes to you – carry a surcharge that grows the longer you leave it: 1% plus 1% for each full month of delay, rising to 15% plus late-payment interest after twelve months. Penalties are higher once the tax office has opened an enquiry. The sensible course is to catch up on any missing years now.
Keep your IBI receipts, your NIE and your title deeds to hand, and consider appointing a gestor or fiscal representative to file each year for you. Many of our clients do, and it takes the worry away. If you are thinking about living in Spain instead, our guide to Residency Options explains the main routes – residents are taxed under different rules.
Planning a purchase and want the full picture of running costs? Read the hidden costs of buying property in Spain, download our free 2026 Buyers Guide, or speak to a Mosaic advisor – we can introduce you to trusted, English-speaking tax advisers on the coast.
This article is general information, not tax advice. Rules can change and every situation is different, so please check your own position with a qualified adviser.
Sources
- Agencia Tributaria – Changes to modelo 210 filing deadlines introduced by Orden HAC/623/2026
- Agencia Tributaria – Imputed income from urban property for own use
- Agencia Tributaria – Tax rates for non-residents without a permanent establishment
- BOE, 23 June 2026 – Orden HAC/623/2026, de 12 de junio
- Sage – Ley antifraude: the new system of late-filing surcharges (article 27, Ley General Tributaria)
- BOE – Orden de 14 de octubre de 1998 (market relation coefficient RM of 0.5 for cadastral values)
- Euro Weekly News, 1 October 2026 – The Spanish tax that non-resident owners forget
COSTA DEL SOL — INVESTMENT
Golden Visa Spain: Is Property Investment Still a Pathway to Residency?
our Expert Guide to Living and Investing on the Costa del Sol
For over a decade, it was one of the most straightforward propositions in the European property market: purchase a property in Spain worth €500,000 or more, and secure the right to live, work and travel freely across the Schengen Area. The Spain Golden Visa programme, introduced in 2013 in the depths of the Spanish recession as a mechanism to attract foreign capital, became one of Europe’s most popular residency-by-investment schemes, issuing more than 14,500 visas through real estate investment in the decade following its launch.
On 3 April 2025, it came to a definitive end. No new applications have been accepted since that date. The decision, announced by Prime Minister Pedro Sánchez in April 2024 and passed by the Spanish Congress of Deputies in December 2024, was driven primarily by housing affordability concerns — the argument that a programme which incentivised high-value property purchases in Spain’s most desirable cities had contributed to price pressures that made housing unaffordable for local residents, particularly in Madrid, Barcelona and Málaga.
For international buyers on the Costa del Sol who had been considering the Golden Visa as part of their motivation to purchase, the closure of the programme raises a set of important and entirely understandable questions. Is property investment in Spain still worthwhile without the residency benefit? What alternatives exist for those who genuinely wish to relocate? And what does this change mean for the market that so many of our clients have been building towards?
“The Golden Visa is gone. The reasons to buy and live on the Costa del Sol are not.”
What the Golden Visa Was — and What It Was Not
It is worth being clear about what the Golden Visa programme actually represented in practice, because the gap between perception and reality was often significant. In the decade it operated, the programme issued approximately 14,576 visas linked to real estate investment. In a country of 48 million people conducting millions of property transactions each year, this was, as multiple analysts noted, a very small number. Golden Visas accounted for less than 0.3 percent of Spain’s total residential property transactions, according to Idealista data.
For the vast majority of buyers on the Costa del Sol — British, Irish, Scandinavian and Northern European buyers relocating for lifestyle, retirement, or part-time living — the Golden Visa was never particularly relevant. EU nationals could already live, work and travel freely across Spain without any visa requirement. British buyers, post-Brexit, faced different residency rules regardless of the Golden Visa, and the programme’s primary beneficiaries were non-EU nationals from China, Russia, the United States and similar markets who sought the Schengen travel benefits the visa conferred.
For our core client base of UK, Irish and Northern European buyers, the end of the Golden Visa is, in practical terms, largely irrelevant to their property purchase decisions. The reasons they buy on the Costa del Sol — the climate, the lifestyle, the quality of new developments, the rental yield potential, the capital appreciation track record, the community — have not changed.
Existing Holders: Your Rights Are Protected
If you hold a current Spanish Golden Visa obtained through a real estate investment made before 3 April 2025, your rights are fully preserved under the transitional provisions of the new law. You may continue to renew your visa on the same terms as before, provided you maintain your original investment and visit Spain at least once during each annual visa period. After five years of residency, you may apply for permanent residency, and after ten years, for Spanish citizenship. The programme’s end affects only new applications — not those already in the system.
Residency Alternatives for Non-EU Buyers in 2026
For non-EU buyers who genuinely wish to establish residency in Spain — whether for retirement, remote working or relocation — the Golden Visa closure has not left a void so much as redirected attention towards alternatives that, for many buyers, are actually better suited to their circumstances.
The Non-Lucrative Visa is the most established route for buyers who wish to live in Spain without working there — typically retirees or those with passive income from investments, pensions or rental income. It requires proof of sufficient financial means (approximately €2,400 per month for the principal applicant, plus €600 per month per dependent), comprehensive private health insurance, and a clean criminal record. The visa is initially granted for one year and renewable for two-year periods thereafter, with permanent residency available after five years.
The Digital Nomad Visa, introduced in 2023, has attracted growing interest from professional buyers who work remotely for companies or clients based outside Spain. It allows holders to live in Spain while maintaining their international employment, and comes with access to Spain’s favourable Beckham Law tax regime for the first four years of residency — a flat 24 percent income tax rate on Spanish-sourced income up to €600,000, which can represent a very significant tax advantage for higher earners relocating from high-tax northern European markets.
For entrepreneurially-minded buyers, establishing a Spanish company (a Sociedad Limitada) and demonstrating local job creation can form the basis of a robust residency application — a route that combines property investment with a genuine business presence in Spain.
“For EU buyers, the Golden Visa was never the point. The Costa del Sol’s lifestyle, climate and investment fundamentals are the point — and those remain entirely unchanged.”
The Investment Case Stands on Its Own
Perhaps the most important message for buyers who had been factoring the Golden Visa into their decision-making is this: the property investment case on the Costa del Sol does not depend on the visa. It never did for most buyers, and it does not now.
Property prices across the region have risen seven to ten percent annually in recent years, driven not by visa-seeking investors but by sustained organic demand from lifestyle buyers, remote workers and retirees across Northern Europe and beyond. Foreign buyers accounted for approximately 14.6 percent of all Spanish property transactions in 2024, according to Idealista — a record figure that was recorded even after the Golden Visa abolition had been announced. Rental yields in prime Costa del Sol locations continue to run at six to ten percent in strong tourist markets. And the pipeline of new development of the quality now coming to market — energy-efficient, architect-designed villas and apartments with resort-standard amenities and panoramic sea views — represents an opportunity that exists entirely independently of any residency programme.
The Costa del Sol has rewarded buyers who acted for the right reasons in every decade since the region emerged as an international property destination. Those reasons — the climate, the community, the lifestyle, the investment fundamentals — have proven more durable than any individual policy. The Golden Visa chapter has closed. The Costa del Sol chapter, for those who understand it properly, is as compelling as it has ever been.
Thinking About Making the Move?
Our team of specialist advisors has been helping international buyers find their perfect home on the Costa del Sol for 15 years. Whether you are at the early stages of research or ready to view, we would love to hear from you.
T: +34 951 177 422 E: info@mosaicrealty.es W: www.mosaicrealty.es