Tax Efficiency for Non EU Owners

Non-EU Owners Can Now Deduct Rental Expenses in Spain

If you own property in Spain but live outside the EU, there’s some excellent news that could make a big difference to your rental income.

A recent Spanish court ruling has declared it unlawful to prevent non-EU property owners from deducting rental expenses. This means that if you’re renting out your Spanish property, you can now offset costs such as:

Repairs and maintenance

Community fees

Property insurance

Mortgage interest

What’s Changed?

Previously, there was an unequal system in place:

EU/EEA residents: Paid 19% tax on net rental income (after expenses).

Non-EU residents (including Brits since Brexit): Paid a higher 24% tax on gross income, with no deductions allowed.

The court’s decision overturns this rule, opening the way for non-EU owners to be treated more fairly.

Can You Claim a Refund?

Yes. This ruling doesn’t just apply going forward—it also creates the possibility of reclaiming overpaid taxes from the past four years. If you’ve been paying 24% on gross rental income without deductions, you may now be entitled to a refund.

What About the Tax Rate Difference?

The separate issue of the 24% vs 19% tax rate for non-EU owners is still under review, so the rates haven’t changed yet. But this ruling is a major step towards a fairer system for all property owners in Spain, regardless of where they live.