As a rule, all expats in Spain are subject to some form of local taxation. Your exact taxation in Spain will be dependent on your specific situation. In general, however, expats will need to familiarize themselves with the tax implications relating to personal income tax (IRPF), wealth tax, capital gains tax as well as inheritance tax:

  1. Personal income tax (IRFP): In Spain, personal income tax applies to your pension, salary or dividends, and is progressively charged from 19% to 46%, depending on how much you earn. You may also be eligible for a flat-rate tax of 25%, with several additional allowances available based on your particular situation.

  2. Wealth tax: High-value real estate assets attract a wealth tax of between 0.2 – 2.5% for both residents and non-residents. There are a number of allowances that may reduce our wealth tax burden, depending on where the property is situated and whether you are using it as your primary residence.

  3. Capital gains tax: Any profits generated from the sale of an asset in Spain are subject to capital gains tax. Such profits are taxed at between 19% and 23% for residents, while a flat rate of 24% applies for non-residents. Again, there are some exceptions to this.

  4. Inheritance tax: Any donations or inherited assets you receive in Spain, both as a resident and non-resident, will be subject to inheritance taxes. 

  1. VAT: VAT is also applicable in Spain. There are three VAT rates, set at 4%, 10% and 21%, depending on the type of product of service being sold.