If you are a foreigner planning to live, work, or invest in Spain, it is essential to understand the country’s tax system. Spain has different tax rules depending on whether you are a resident or a non-resident, and it is crucial to comply with these regulations to avoid legal issues and unexpected costs.
1. Resident vs. Non-Resident Tax Status
Your tax obligations in Spain depend on whether you are considered a tax resident or non-resident.
• Tax Residents: You are considered a tax resident in Spain if you meet one of the following criteria:
• You spend more than 183 days in Spain in a calendar year.
• Your main economic interests (e.g., business, investments, or work) are in Spain.
• Your spouse or dependent children live in Spain.
Tax residents must pay tax on their worldwide income.
• Non-Residents: If you do not meet the above criteria, you are considered a non-resident and only pay tax on income generated in Spain.
2. Income Tax in Spain
For Tax Residents: Personal Income Tax (IRPF)
Spain has a progressive income tax system, meaning the more you earn, the higher your tax rate. The general rates (as of 2024) are:
Income Bracket (€) Tax Rate (%)
Up to 12,450 19%
12,451 — 20,200 24%
20,201 — 35,200 30%
35,201 — 60,000 37%
60,001 — 300,000 45%
Over 300,000 47%
For Non-Residents: Non-Resident Income Tax (IRNR)
• Employment income: Flat rate of 24% (or 19% for EU/EEA residents).
• Rental income: 24% on gross income (EU/EEA residents can deduct expenses).
• Dividends, interest, and capital gains: 19%.
