Learn how to declare rental income in Spain and take advantage of tax deductions. Understand your obligations step-by-step as a landlord or tenant.
Spanish Tax on Rental Income: What You Need to Know
Declaring rental income is a tax obligation in Spain for both landlords and tenants. Doing it right can help you avoid penalties and even benefit from important deductions. As the Spanish tax on rental income campaign for 2024 (filed in 2025) begins, here’s what you need to know to get it right.
In this article, we’ll guide you through how to declare rental income based on your situation: whether you’re renting out your property or living in a rented home.
Declaring Rental Income as a Landlord
If you own a property that you rent out in Spain, you must declare your income and deductible expenses in your annual tax return. This information is filed under “Real Estate Capital Income” on the Spanish Tax Agency’s online system (Renta Web).
Steps for landlords:
Property identification:
Check your draft tax return to ensure the rental property is listed. If it isn’t, you’ll need to manually add it in the relevant section.
Property status:
Indicate how the property was used throughout the year. Choose “rented” if it was rented all year or specify the dates if it had different uses.
Contract details:
Include the tenant’s tax ID (NIF), contract start date, length of lease, and rental type.
Applicable tax reduction:
If the property is rented as a main residence and the contract was signed before May 26, 2023, you may apply a 60% reduction on net income. For contracts signed from January 1, 2024 onwards, reductions range between 50% and 90%, depending on the location, tenant’s age, or whether rent was lowered compared to a previous contract.
Deductible expenses:
These may include mortgage interest, repairs, home insurance, property tax (IBI), community fees, and depreciation (only on the building value, not the land).
Accessory spaces:
If you rent out a garage or storage room with the property, they should be declared together if the ownership percentages match.
Example:
A landlord who earns €900/month in rent and reports €2,000 in deductible expenses annually will significantly lower their taxable base using these tools.
Declaring Rent as a Tenant
Even though the state-level rent deduction was removed in 2015, some tenants with contracts signed before that date may still benefit if they meet certain conditions.
How to apply the old state deduction (pre-2015 contracts):
- Go to Annex A.1 (III) in your tax return
- Enter the total rent paid and the landlord’s NIF in the corresponding field
Regional deductions still exist and vary by autonomous community. These are especially helpful for:
- Young people under 35
- Low-income households
- People with disabilities
Examples of regional rent deductions:
- Valencia: 15% of rent, up to €550 for young tenants under 35
- Madrid: Up to €1,237/year for under 40s with income below €26,414
- Catalonia: 10% of rent, up to €300 for widowed seniors over 65
- Andalusia: 15% of rent, max €600 for seniors over 65 with low income
Keep all contracts and rent payment proof to qualify.
Common Mistakes to Avoid
- Renting a room is not the same as renting a full residence. Each must be declared, but deductions may differ.
- If the property was empty part of the year, declare that period as “available to the owner”.
- Tourist or short-term rentals are not eligible for the 60% main residence reduction.
What Happens If You Don’t Declare Rental Income?
The Spanish Tax Agency (Agencia Tributaria) can cross-check your rental activity through property records, bank statements, and utility bills. Failing to declare can result in fines, penalties, and the loss of applicable deductions.
Frequently Asked Questions
Can I claim rent deductions if I’m a tenant with a post-2015 contract?
Not at the national level, but yes through some regional deductions, depending on your location and circumstances.
Which expenses are deductible as a landlord?
Eligible costs include IBI, community fees, home insurance, loan interest, depreciation, repairs, and contract formalization fees.
Take Control of Your Rental Taxes in Spain
Whether you’re a landlord or a tenant, correctly declaring your rental income or rent payments is key to complying with Spanish tax laws — and saving money. Understanding the current legislation and using the tools provided by the Spanish Tax Agency will help you optimize your tax return and avoid costly mistakes.
Need Help With Spanish Tax on Rental Income?
At Entre Trámites, we offer professional tax and accounting services tailored to landlords, tenants, autónomos, and foreign residents. You can also contact us directly through this contact Form for us to call you, or if you prefer, you can schedule a free consultation or write to us on WhatsApp.
