The Spanish IRS simplifies the declaration of real estate income for Non-Residents in Spain

On 31 January 2024, Order HAC/56/2024 was published introducing amendments in relation to the filing of Form 210. This Form is used to declare real estate income obtained by Non-Residents with real estate located in Spain.

From now on, the obligations of Non-Residents are simplified, so that they are allowed to declare annually the income derived from the properties they have rented in Spain.

Previously income obtained from rentals in Spain by Non-Residents had to be declared quarterly, in the period of the first twenty days of the months of January, April, July and October. So, taxpayers were forced to file up to 4 returns each year for rentals obtained in Spain.

The approval of this new Law will allow the annual grouping of the income obtained from rentals in Spain, as long as the income comes from the same property. In other words, if you have two or more properties for rent, you will have to file an annual return for the income obtained by each one of them.

These amendments will be applicable, for the first time, to accruals for the 2024 financial year. That is, as of this year, the obligation to file a quarterly return is abolished, so that the first period for declaration and payment will be the first twenty days of January 2025, including in it the whole rental income obtained throughout the 2024 financial year. The payment of the tax debt, if applicable, may be done by direct debit until 15 January, or with other payment methods if it is done in the following days.

With this change, a further step is taken to equalize resident and non-resident taxpayers with respect to the declaration of their tax obligations. However, it is still impossible for Non-Residents to offset income grouped together, as well as to deduct expenses associated with rentals, to apply a higher tax rate to non-EU citizens or to apply certain reductions, such as the one regarding the rental of a property for residence.

Along with the annual declaration of rents, the obligation to file an annual declaration for the imputation of real estate income for the days in which the property has remained at the disposal of the taxpayer, that is, for the days in which the property has not been rented, is maintained.

At Spanish Lawyer NYC we will be happy to assist you with the fulfillment of your tax obligations for the ownership of real estate in Spain.