Own use of holiday properties

Owners of a non-rented Spanish vacation property are obliged to pay a tax annually to the Spanish state for the own use of the property, even if itwas empty all year round. The corresponding proactive declaration is made using tax form 210.

Below we answer a number of frequently asked questions about Form 210:

Content overview

• What exactly is taxable?
• Who is required to submit Form 210?
• Is it necessary to submit Form 210 even if the property is rented?
• What is the tax to be paid?
• Can costs be taken into account when calculating the tax?
• Is the tax rate independent of the taxpayer's residence?
• When and how must the Form 210 be submitted?
• What to do if the form is not submitted on time?

What exactly is taxable?

The own or self-use of a non-rented Spanish vacation property by its owners. Tax is therefore a kind of fictitious own rent. Commercial real estates, undeveloped plots and other not habitable objects are not subject to this taxation. Real estate is only then considered as not used by its owner if it was rented to a third party and only for the time, which it was actually rented: The (partial) vacancy must be taxed just like the actual self-use.

Who is required to submit Form 210?

Non-residents who own property in Spain. Residents in Spain pay a comparable tax rate as part of their annual income tax return. In the event that one or more persons are legally entitled to use the property as usufructuary and other persons are owners of the so-called bare property, it is the usufructuary who is obliged to file this form and pay the tax. If there are several owners of the real estate, a declaration must be submitted by each owner. A joint assessment is not possible.

Is it necessary to submit Form 210 even if the property is rented?

If the property is rented, the tax is only payable proportionally for the days when the property was empty or at the owner's disposal.

What is the tax to be paid?

The tax rate to be paid depends on the cadastral value of the property. The cadastral value appears, among other things, on the property tax receipt (IBI). To determine the tax base, a percentage of 1.1% is applied to the cadastral value of the property if it was established in the tax period or within the ten previous tax periods. For older cadastral values, the percentage is 2%.

Can costs be taken into account when calculating the tax?

No. It is only possible to deduct the amount of verifiable donations to Spanish charities and foundations, up to 80% of the first EUR 150 and 35% of the balance, with a ceiling of 10% of the tax base (depending on who the recipient is). For the donation to be recognized by the tax office, a certificate of the gifted amount must be submitted.

Is the tax rate independent of the taxpayer's residence?

Since 2016, a tax rate of 19% applies to residents of the European Union, Iceland and Norway. For all other taxpayers residents outside the European Union (including Switzerland), the tax rate is 24%.

When and how must the Form 210 be submitted?

The form can be submitted from January 1st to December 31st of the following year. The submission must be made in electronic form; the Spanish Tax Office no longer accepts printed tax forms. Payment must be made through a Spanish bank, although the most convenient way is to set up a direct debit authorization in favor of the Tax Office. The amount will then be debited from the taxpayer‘s bank account at the end of December.

What to do if the form is not submitted on time?

The Spanish tax office has a period of 4 years to check returns taxes that have not been submitted and to demand payment. This happens regularly when the property is sold without having paid the taxes of previous years. In addition to the tax amounts, the tax office can demand interest on arrears and impose a penalty of 50% of the unpaid tax quotas. However, tax penalties are excluded if the taxpayer voluntarily submits the tax returns and pays the tax quotas. In these cases, only late payment surcharges of 1 to 15% of the tax quota are to be paid, and interest on arrears if payment is made after more than one year.