IRNR or Non-Resident Income Tax applies to individuals and companies who are not resident in Spain for tax purposes, but who receive income or own property in the country. Many people are unaware of this tax and forget to declare it, which is risky.
Are you a Spanish tax resident? No problem, click here to access our practical sheet on IRPF (personal income tax).
Let's start with a concrete example!
Before going into the details, I (Geoffroy) would like to share with you my own example.
Last year, I had 2 apartments generating rental income in Spain:
- Apartment "Planelles": rental income of €22,752
- Apartment "Mercader": €26,673 rental income
- TOTAL = €49,425
Every year, I share my income and expenses with my Spanish accountant, along with all the financial information needed to reduce the tax base. Thanks to this, I have paid the following amounts in taxes:
- Planelles" apartment: €1,795 in IRNR taxes
- Mercader" apartment: €2,517 in IRNR taxes
- TOTAL = €4,312, i.e. a percentage of 8.7% of the gross rental income of €49,425 mentioned above.
But isn't IRNR 19% for EU residents and 24% for non-EU residents? So, how do you manage to squeeze so much income, so as to have a much lower tax base? It's simple: crush the income with expenses (electricity, internet, water, cleaning, repairs, interest on loans) and depreciation (amortization of the total cost of acquisition of the property, works, furnishings and decoration).
Who can help you declare your rental income in Spain?
A large number of companies can help you declare your Spanish rental income, and file the IRNR (Impôt sur les Revenus des Non-Résidents) return for you, also known as the "Modelo 210".
I personally use the services of Delaguía&Luzón, based in València. You can contact Carolina Berlanga at carolina.berlanga@delaguialuzon.com or Felix de la Guia at felix.delaguia@delaguialuzon.com
The cost of their services for me is 360€ excluding tax per year, for 3 apartments, i.e. 120€ excluding tax per apartment per year. That's the equivalent of €10 a month, and I confess I haven't tried to make these IRNR declarations myself, but I imagine it's quite possible.
Who is affected by the IRNR?
Non-residents, i.e., any person or entity whose tax residence is not in Spain (they spend less than 183 days cumulatively per year there).
What income is subject to IRNR?
Rental income, real estate capital gains, dividends, interest, royalties, income from occasional professional activities.
What is the IRNR tax rate?
The IRNR is not progressive; there are two rates:
- 24% for residents of countries outside the EU or the European Economic Area.
- 19% for residents of the European Union (EU/EEA).
The gross declared income is subject to taxation without the possibility of deductions for non-EU residents. Residents of the EU or countries belonging to the EEA may be entitled to certain deductions (for example: expenses for supplies, personnel and provisions related to the economic activity on Spanish soil and the special tax on real estate for legal entities – Gravamen Especial sobre Bienes Inmuebles de Entidades No Residentes).
How to declare and pay the IRNR
- Modelo 210 Please note: do not complete the Modelo 100, as this is for Spanish tax residents. The Modelo 210 must be submitted quarterly or annually, depending on the type of income. Terreta tip: it used to be quarterly, and became annual in 2024.
- When to declare your IRNR? Quarterly declarations are due by April 20, July 20, October 20 and January 20 of the following year. Annual declarations are made between January 1 and 20 of the year following the year in which the income is generated. Henceforth, unless your situation changes, you must declare your Spanish rental income each year between January 1 and 20.
- Payment can be made directly online via the Agencia Tributaria portal or by other means offered by the Spanish tax authorities.
Risk of non-compliance with tax obligations
- You risk fines and interest in the event of non-declaration or late payment.
- Appeals: if you disagree with the Spanish tax authorities, you have the option of making an administrative appeal.
Do you have to declare rental income from Spanish properties in your country of tax residence (France, Belgium, England, Switzerland, the Netherlands, etc.)?
Yes, but the very good news is that most countries have bilateral double tax treaties.
This means that, in the vast majority of cases, you pay tax on rental income only in Spain.
In your country of tax residence, you must declare this rental income from abroad, but it is not taxed. Often, the taxation that should take place in your country of tax residence is offset by a tax credit.
If you are a French tax resident, for example, and have rental income in Spain, I've created an article detailing what you need to do on impots.gouv.fr, click here to read the guide.
Practical advice from Terreta Spain
- Consult a tax advisor: the most important advice in our opinion, do not hesitate to consult a tax expert specializing in international taxation. Each situation is unique. Contact our teams to be put in touch with competent professionals.
- Documentation: keep all supporting documents that clarify your situation, such as lease agreements, bank statements, etc. This will make it easier for you to declare and justify your income or an appeal, if necessary.
- Tax treaties: don't forget, Spain has signed tax treaties with around forty countries. They avoid double taxation. Find the list of countries concerned by clicking on this link.
FAQ: Non-Resident Income Tax (IRNR)
What is the IRNR?
The IRNR is a tax that applies to individuals and entities who are not residents in Spain but receive income from Spanish sources. Any non-resident receiving income in Spain, such as rent, dividends, or capital gains, must pay this tax.
How can I declare my income?
Form 210 must be completed and submitted on time, either quarterly or annually depending on the nature of the income. Again, since 2024 the IRNR declaration has become annual. Ask your accountant in Spain for advice and guidance.
What are the consequences of non-declaration?
Financial penalties may be applied, as well as an increased risk of tax audit by the Spanish authorities.
What is the IRNR rate?
It is 19% for EU residents and 24% for those who are not.
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