Obligations if you own a holiday let in Spain

It is very common nowadays to live in the UK and own a property in Spain, especially in the beautiful Marina Alta region. However, it is interesting (and a little worrying) that people in this situation are not aware of their fiscal responsibilities to the Spanish state.

If you own a property in Spain but are not resident,then in terms of tax, you fall into two categories.

Firstly, if you use your home to come on holiday and it is only for personal use, then it is necessary to pay non-resident tax in Spain. This annual tax is based on the catastral value of your property and is calculated using your catastral reference.

Secondly (and this is the one that most people seem to overlook), if you're not a resident in Spain but you have a property which you rent out as a holiday let, it is necessary to file a quarterly tax return. You are expected to manage the property as if it were a business. This means that you can claim expenses on anything that you purchase for the property (including fiscal advice and administration). However, it is necessary to declare your quarterly income. This only applies if you have rented the property within any given quarter. For example, If you rent your property to tourists in July, August and September but then the rest of the year you have the property for personal use, then you are only expected to file a tax return for the 3rd quarter.

In 2018, three separate laws were introduced which give extra powers to the central tax office in Spain. The main one being that all booking sites (Airbnb for example) have the obligation to declare their clients to the tax office. Therefore, it is increasingly difficult to get away with not paying. The result can be a substantial fine and a fiscal investigation. The point is that nowadays it is very easy to be caught by the tax office in Spain.

If you think that managing the tax for a property is more hassle than it's worth, then we recommend speaking to a fiscal adviser. Really, the process is quite simple for someone who works with Spanish taxes everyday.

At LingoMar we offer full fiscal and tax services to keep you line line with Spanish law. We keep the costs of our services as low as possible and we can guarantee complete peace of mind with regards to fulfilling your fiscal obligations.

Get in touch for an informal chat with no obligation whatsoever at www.lingomar.com or visit our Facebook page at https://www.facebook.com/lingomar/

Many Thanks!