New Spanish Expenses Tax Relief if Own Rental Property in Spain
Published / Last Updated on 24/10/2025
It has been estimated that up to 1 million Brits own a property in Spain. Indeed, the British are still the number one ‘foreign’ purchaser in Spain today.
Of those British owners, perhaps 300,000 to 400,000 are not resident in Spain and still live in the UK.
That said, the numbers are falling due to Spanish taxation on non-EU resident owners, meaning US citizens, Canadians and now Brits.
Before Brexit
British citizens were also part of the EU and could offset property expenses against rental income and therefore, reduce taxes payable in Spain. So called ‘expenses relief’.
After Brexit
The Brexit Transition Period ended on 31st December 2020. This meant that from 1st January 2021, ‘expenses relief’ could not longer be claimed by non-EU resident Brits on their Spanish rental property. This has clearly made investment in Spanish property less attractive.
Spanish National Court
On 28th July 2025, the National Court in Spain ruled that non-EU resident owners in Spain would now be allowed to claim property expenses relief against rental income profit, meaning less taxes payable in Spain.
Claimable Expenses
- Cleaning and maintenance.
- Communidad (local regional taxes or taxes payable within a local shared/communal property development) for shared or local facilities, pools, gardens etc.
- Depreciation of assets inside the property (e.g., furnishings).
- Insurance.
- Local taxes such as IBI (Impuesto sobre Bienes Inmuebles – a yearly property tax paid by expat owners between 1.1% - 2.0% of the property value depending upon which automonous region you live in).
- Management fees.
- Repairs.
- Utilities (electricity, gas and water).
Not Quite There Yet – So Keep Records
- Form 210 (Modelo 210) – this is the form that must be completed by non-EU resident owners for their property to pay the 1.1% - 2.0% pa IBI.
- Modelo 210 still does not include a section for expenses, so how do you claim them?
- The Spanish Tax Year is a calendar year (Jan – Dec), so we are still in Tax Year 2025.
- You can go back by up to 4 years, i.e., to tax year 2021 to make a ‘Tax Rectification Request’.
- This means you may be due a tax refund for previously un-allowed, but now allowed, yet unclaimed expenses for Tax Years 2021, 2022, 2023 and 2024.
- Come 1st January 2026, tax year 2021 will ‘drop off’, so you need to talk with your local tax adviser now to make a claim for 2021 before the new tax year starts.
Appeal Delay?
The State Attorney’s Office (Spanish government’s legal department) has made an appeal to the Spanish Supreme Court to repeal the National Court’s ruling to allow expenses relief for non-EU resident owners. This could take anything between a few months and a year to resolve, so ‘don’t hold your breath’ and wait. Get some Spanish Tax advice and make that rectification claim now, so that you do not miss the 2021 claimable period if the State Attorney’s appeal is ‘thrown out’.
Tax Refunds
Don’t ‘hold your breath’ for any tax refund, we know of one former Spanish Tax resident, now back in the UK that took 3 years to get a tax refund on another, unrelated matter.
