The main difference in terms of taxation is whether you are a resident of the country or a foreigner (there is also a distinction between citizens of EU countries and those from non-EU countries) owning property.

1. Taxes and fees for residents in the case of property rental:

Within this category, there are additional criteria:

• Your own residence is the property you wish to rent out:

This property is your registered address, and you live here on a regular basis. Tax obligations: IBI (Impuesto Sobre Bienes Inmuebles) must be paid to the relevant municipality. The rate is determined by the municipality in each city, and it is based on the cadastral value (which is different from the purchase price). It generally ranges from 0.4% to 1.3%. In addition, municipalities may offer further discounts.

For example, if you use the property as your primary residence, the discount can be up to 40%.

Every year, the local municipality sends information about the amount to be paid and the payment deadline.

• Property used for recreational purposes.

In this case, you already own a property that serves as your registered address and where you reside. Therefore, you use the property as a vacation home, not for rental income purposes.

In this case, you are only required to pay the IBI tax, as you are not utilizing the property to generate income. The calculation of the tax is the same as for a property used as a primary residence, but the discount cannot be applied.

• You would like to rent the property for short-term and long-term.

In this case, you do not live in the property, but you want to rent it out for short or long-term for profit. Naturally, the IBI (property tax) must be paid in all cases, including in this situation, but no discounts are applicable. In addition, you will need to pay taxes on the income derived from renting out the property, which should be paid along with your annual tax return.

For both short-term and long-term rentals, the same IRPF (Personal Income Tax) rules apply. Therefore, the rental income will be taxed according to the personal income tax brackets. The tax amount is determined based on the net rental income (after deducting costs such as maintenance, repairs, insurance, etc.). The incurred costs must be deducted from the total annual income, and the remaining amount is the basis for the personal income tax (IRPF).

The IRPF tax rate is progressive, meaning the higher the tax base, the higher the rate. (For example, with an income of 20,000 Euros: 19% tax on the amount between 0-12,450 Euros, and 24% tax on the remaining 7,550 Euros). Additionally, there are other discounts available that can be claimed, such as for children or as a single parent.

If the income comes solely from the property's use, then the calculation is very straightforward.

However, if you have other sources of income, such as from employment, you must add them together, and the tax will be calculated based on the total amount.

2. Taxation conditions for foreign property owners (non-residents in Spain) when renting out property:

A nem rezidens személyek számára a spanyol ingatlanbérbeadásból származó jövedelemből származó adókulcsok a következőképpen alakulnak:

• Standard Tax Rate:

Net income is calculated by deducting expenses (e.g., maintenance, insurance, utility bills, etc.) from the total income generated from renting the property.

• Non-residents pay a 24% tax on the net income from rental properties.EU/EEA citizens:

If the non-resident person is a citizen of an EU or EEA (European Economic Area) country, the tax rate is 19%.

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