Brexit and rental income tax in Spain
14 Jul. 2016
According to Spanish Non-Resident Income Tax Act, the owners of Spanish properties that are rented out should declare the gross income and pay taxes on it at a flat tax rate of 24%.
However, taxpayer residents of the EU, Iceland and Norway are entitled to deduct some of the costs allowed by the Personal Income Tax Act for residents, provided that those costs are related to rental. Additionally, the tax rate applicable to the net income is just 19%.
UK tax residents will lose the benefit of paying taxes on net rental income at a lower tax rate, one of the several measures approved to end with the discrimination between residents of Spain and the EU.