Our American Client Just Bought in Spain

The moment of purchase always gets the spotlight. The notary, the keys, the celebration. What comes after is where many international buyers, especially Americans, face unexpected complexity.

At PASKU.CO, we believe true 360° service means preparing our clients for what comes next. If you have purchased property in Spain as a non-resident, there are four key annual tax obligations to understand. This guide gives you clarity without turning you into a tax advisor.

1. IBI. The One Nobody Forgets

IBI (Impuesto sobre Bienes Inmuebles) is Spain’s annual municipal property tax. Every property owner pays it, whether resident or not.

What to expect

• Typically ranges between €200 and €2,000 per year

• In Málaga, a property with a cadastral value of €100,000 may pay €400 to €700 annually

When it’s due

• Usually issued between September and November

• Payment window lasts one to two months

Key insight

IBI is generally collected automatically via direct debit from a Spanish bank account. If this is not set up, the bill may be sent to the property address, which could be empty for months.

Smart move: appoint a fiscal representative or gestor to ensure nothing is missed.

2. IRNR. The Most Overlooked and Most Penalized

IRNR (Impuesto sobre la Renta de No Residentes, Modelo 210) is where most non-resident owners run into trouble.

Unlike IBI, this tax is not automatically issued. You must declare it yourself every year.

If your property is not rented

You are taxed on imputed income:

• 1.1% of cadastral value if recently revised

• 2% if not revised

• Tax rate for U.S. citizens: 24%

Example:
€100,000 cadastral value leads to €1,100 imputed income and €264 tax per year

Deadline: 31 December of the following year

If your property is rented

Rental income is taxed at 24%, but there is an important update.

Following a landmark ruling in Spain in 2025, non-EU owners, including Americans, can now deduct property-related expenses, such as:

• Maintenance

• IBI

• Insurance

• Mortgage interest

• Community fees

This reduces taxable income significantly.

Since 2024:

• Declarations are annual instead of quarterly

• Deadline: 20 January

Critical warning

Failure to file IRNR can create serious issues:

• Spanish tax authorities can claim up to four years of unpaid taxes

• Penalties and interest apply

• When selling, the notary may withhold part of the sale price to cover unpaid taxes

In addition, buyers already retain 3% of the purchase price for capital gains tax on non-resident sellers.

Bottom line: annual compliance avoids major financial friction later.

3. Wealth Tax. Only for Some

Wealth Tax (Impuesto sobre el Patrimonio, Modelo 714) applies to higher-value assets.

When it applies

• Net assets in Spain exceed €700,000

Regional advantage

In Andalusia and Madrid, there is currently a 100% rebate, meaning you declare but effectively pay nothing.

Other regions, such as Catalonia or the Balearic Islands, do apply the tax.

Rates

• Progressive from 0.2% to 2.5%

High-net-worth note

For assets above €3 million, the Solidarity Tax on Large Fortunes (ISGF) may apply at a national level.

4. Modelo 720. The One Many Do Not Know Exists

Modelo 720 is not a tax, but an informational declaration.

Who must file it

Only if you become a Spanish tax resident and:

• Spend more than 183 days per year in Spain

• Hold foreign assets above €50,000

Who does not need to file

Non-resident property owners do not have this obligation.

Important for American buyers

U.S. citizens already have global reporting obligations through:

• FBAR (FinCEN 114)

• FATCA (Form 8938)

Owning property in Spain can add another layer of reporting. Coordination between a Spanish and U.S. tax advisor is essential.

Key Deadlines at a Glance

• 20 January → IRNR for rental income

• September to November → IBI payment window

• 31 December → IRNR for non-rented property

• April to June → Wealth Tax, if applicable

• Up to four yearsย้อนหลัง → Tax authorities can claim missed IRNR

Final Thought. This Is Where Real Service Begins

Buying property in Spain is an emotional milestone. Managing it correctly afterward defines the quality of the experience.

Most agents disappear after handing over the keys. The best ones stay relevant long after.

At PASKU.CO, we position ourselves exactly there. Between lifestyle and long-term ownership. Ensuring our clients are not only inspired to buy, but fully prepared to own. It is part of delivering a seamless, high-level real estate experience.

Please check our current Lifestyle property selection from Marbella here: https://www.pasku.co/location/marbella