Tourist rental property taxation


A rental contract for non-residential use is considered a contract, in a habitable property, is that destined to use other than satisfying the need for a permanent home for the tenant.

Thus, when the temporary rental takes place of a furnished property which is ready for immediate use, offered and promoted to tourists through touristic channels for profit, it is considered a private holiday home rental, and will be governed by a specific regime, under the sector-specific regulations, in accordance with Article 5 e) of Act 29/1994, of 24 November, on Urban Rental.

Over the past few years, there has been a continuous rise in the use of private accommodation for holiday home rentals and there is a clear distinction between these and the services provided by the hotel industry.

Act 37/1992 of the Value Added Tax Act (LIVA) gives as examples of "ancillary services in the hotel industry" those of catering, laundry and analogous services (Articleº b.’ Value Added Tax Act (LIVA). Thus, accommodation services are characterised by providing customer services beyond making the property, or part of it, available. In other words, accommodation services, in contrast to property rental, normally include the rendering of services such as concierge and permanent and continuous customer service in a space allocated for this purpose, daily cleaning of property/room and accommodation, daily changing of bed linen and bath towels as well as other services (laundry, luggage storage service, daily press, accommodation booking (holiday reservation), etc.) and sometimes room-service and catering services. (DGT consultations V0081.16 and V0575.15)

In particular, as well as the aforementioned ancillary services in the hotel industry, services such as daily cleaning of the property/room and the daily changing of bed linen and bath towels in the property are also included.

However, the following services are not considered ancillary services in the hotel industry:

  • Cleaning services in the property provided at the beginning and at the end of the stay of each tenant.

  • Change of bed linen and towels in the property provided at the beginning and at the end of the stay of each tenant.

  • Cleaning in the building's communal areas (hall, stairs and lifts) and the area in which it is located (green areas, gates, pavements and streets).

  • Technical support and maintenance services for repairs in plumbing, electricity, glass, blinds, locks and household appliances.


Article 78 of the Legislative Royal Decree 2/2004, of 5 March, approving the revised text of the Law Governing Local Tax Offices (TRLRHL), defines the nature and taxable event of the Business Activities Act (IAE), and establishes that it is a real, direct tax, and a tax event that is constituted by the carrying out, in Spain, of business, professional or artistic activities, within or not the specific place and which are or are not specified in the tax rates. Furthermore, Article 79 TRLRHL governs the taxed economic activity, stipulating that an activity is considered to be of a business, professional or artistic nature when it entails the independent management of production activity and/or human resources, with the aim of operating in the production or distribution of goods or services.

Rule 2nd of the Directive for the application of Business Activities Tax (IAE) rates, both approved (Instruction and Rates) by Legislative Royal Decree 1175/1990, of 28 September, establishes that the performance of any economic activity specified in the Rates, as well as the exercise of any other business, professional or artistic activity, not specified in these, will result in the mandatory filing and payment of this tax, unless this Directive states otherwise. Rule 4th.1 of this Directive states that, as a general rule, the payment corresponding to an activity exclusively entitles the exercise of this activity, unless the Law governing this Tax, the Rates or this Directive state otherwise.

Thus, in accordance with Regulation 4th.1, we must analyse the various possibilities within the activity of private holiday home rentals with the aim of correctly classifying the Business Activities Tax rates:

Firstly, we must analyse the activity in which a person or company rents, in exchange for a fee, holiday homes for specific periods of time and provides accommodation services. Taking into consideration that accommodation activity is characterised as normally including the rendering of various services, such as the daily cleaning of property/rooms, daily changing of bed linen and bath towels, luggage storage services, the providing of crockery, tableware and kitchen appliances, and sometimes, catering services. Thus, IAE rates classify in Group 68 of the first section,“Accommodation Services”. Within this Section is group 685 “Non-Hotel Tourist Accommodation”, which classifies the business activities of accommodation services, but those which are provided in establishments other than hotels and motels, hostels and guest houses, inns and boarding houses, apartment hotels, organised companies or agencies providing private apartments and campsites for tourists. Specifically, Group 685 includes accommodation services offered in country homes, holiday cottages and guest houses in rural areas, as well as youth hostels, flats and other similar premises that do not have the status of the previously listed establishments.

Furthermore, according to the attachment to Group 685, if the accommodation establishments classified in this Group are open for fewer than eight months a year, the charge rate will be 70% of the charge stated in the same.

However, and in accordance with the provisions of letter F) of section 2 of rule 4th of the Administrative Directive, taxpayers who work in accommodation services may provide, without the payment of any additional fees, complementary services, such as cleaning, changing of bed linen, internet connection, television, etc.

Thus, Group 685 of the first section of IAE Rates classifies the activity of operation of Non-Hotel Tourist Accommodation (DGT V0215-18, DGT V0731-17).

Secondly, we must analyse the case in which a person or company, owner of a tourist rental accommodation, leases it to a business entity or an individual, who operates it as a Non-Hotel Tourist Accommodation and employs tour operators and/or personnel to manage it and assumes all the risks of the transaction. The person or company owner of the tourist dwelling carries out the leasing activity of property classified in epigraph 861.2 of section one of the IAE “Rental of industrial property and other rentals NCOP” (DGT V2540-08, DGT 1160-02).

Thirdly, we must study the case that this activity consists exclusively in the leasing for periods of time of houses or part of these, without providing any services associated to the accommodation activity and is limited to providing the property to the lessee. Thus, when this is the case, it is considered an activity pertaining to Epigraph 861.1 “Home Rental” of Section one of the Tariffs, and the owner of the activity, is obliged to register for and pay taxes on this activity. However, Note 2nd of the aforementioned Epigraph establishes that “taxpayers whose fees for this activity are lower than 601.01 euros will pay taxes at zero rate”, in which case, in accordance with the provisions of Rule 15th of the Instruction, “taxpayers will not make tax payments for this tax, nor are obliged to file a tax return” (DGT 1821-02).

In conclusion, the rental of flats or accommodation for weekends or for specific periods, without the owner of the rental activity providing any type of service to the tenant, constitutes an activity pertaining to Epigraph 861.1 of the Section one of the Tariffs, “Home Rental” (DGT V0898-17, DGT V0931-11 DGT 1482-02)

It must be taken into account that, once the activity has been correctly classified in its group or epigraph, the exemption regime governed in Article 82.1 c) TRLRHL, states that individuals, residents and taxpayers of Corporation Tax, civil partnerships and entities of Article 35.4 of Act 58/2003, of 17 December, Tax General, are exempt from paying Economic Activities Tax (IAE), when there is a net volume of business lower than 1,000,000 euros.

This exemption represents, for the purpose of this tax, the non-obligation of registering or paying the tax, regardless of the census obligations that may correspond to the taxpayer in accordance with the provisions of Royal Decree 1065/2007, of 27 July, approving the General Regulation of the activities and procedures of tax management and inspection and the development of common standards for the application of taxes, which is governed in the census obligations in chapter I of Title II of the Regulations.


In general, earnings from tourist rental accommodation will be considered Returns on capital assets.

For this to be applicable, the rental must be limited to the making available of a property for a specific period of time, without the rending of services ancillary to the hotel industry. As an example, the following will not be considered as such: cleaning services carried out before the arrival or after the departure of the tenants or the delivery and collection of keys on arrival and departure of clients.

Earnings obtained from the rental activity shall be declared by the owner of the property or the owner of the right conferred upon them for the rental (for example, in the case of a usufructuary of the property) for the difference between the whole income and the tax deductible expenses.

To the net yield resulting from this operation the reduction of 60% will be not applicable as foreseen in Article 23.2 of the Personal Income Tax Act, as the aim of tourist accommodation is not to satisfy a permanent need for housing but rather to cover a temporary need.

The periods of time in which the property is not rented will generate the corresponding imputation of property income, as for all properties. The amount will be the result of applying the corresponding percentage of imputation (1.1% or 2%) to the rateable value of the property, and according to the number of days it has not been used for tourist accommodation purposes (or, where applicable, leased).

Nonetheless, leasing can be understood as a business activity and the earnings received from the same will be considered earnings from economic activities when, as well as making the property available, services ancillary to the hotel industry are offered during the tenant's stay, such as: daily cleaning of property/room, daily change of bed linen and towels, catering and leisure activities and ancillary activities or when, without providing these services, a person is employed with a full-time contract to manage this activity.


General information:

  • Persons or entities who rent out private holiday rental homes are considered, for the purposes of VAT, employers (Art. Value Added Tax Act).

  • In so far as this activity is carried out by employers, income from renting out private holiday rental homes is subject to VAT (art. Value Added Tax Act).

  • Being subject to VAT determines the non-subjection to Property Transfer Tax (ITP), unless the exemption can be applied set forth in VAT (Art. 4. four Value Added Tax Act).

  • In accordance with the case-law of the Directorate General for Taxes (consultation V0420-18, among others), income from the rental of private holiday rental homes in which the lessor does NOT provide services characteristic of the hotel sector, is exempt from VAT and, therefore, subject to Property transfer for valuable consideration of the Property Transfer Tax. In such cases, the lessor shall not file or pay VAT.

  • In the event of providing services specific to the hotel industry, the leasing of a private holiday rental home shall not be exempt from VAT and must be taxed at the reduced rate of 10%, as a hotel establishment, by application of Article 2nd Value Added Tax Act and in accordance with the criteria of the Directorate General for Taxes. See consultation V0714-15.

  • In the ITP, Property Transfer Tax, specifically Property transfer for valuable consideration, the tax rate for leasing shall be obtained by applying to the net tax base the rate established by the Autonomous Community.

    If the Autonomous Community has not approved the rate set in the previous paragraph, the following scale shall be applied:


Up to 30.05 euros


From 30.06 to 60.10


From 60.11 to 120.20


From 120.21 to 240.40


From 240.41 to 480.81


From 480.82 to 961.62


From 961.63 to 1,923.24


From 1,923.25 to 3,846.48


From 3,846.49 to 7,692.95


From 7,692.96 hereinafter, 0.024040 euros for every 6.01 euros or fraction.

(Article 12.1 of the Legislative Royal Decree 1/1993, of 24 September).


Internal regulations

In accordance with the internal regulation, Legislative Royal Decree 5/2004, of 5 March, approving the revised text of the Act on Income Tax for Non-Residents (LIRNR), income obtained in Spanish territory is considered earnings derived, directly or indirectly, from real estate assets situated on Spanish territory or from rights relating to these assets.


Agreements for avoiding double taxation signed by Spain attribute power to tax earnings on property to the State where this is located. In accordance with the Agreements, earnings from property may be subject to tax in the Statement of Financial Condition of the same, regardless of whether the earnings arise from the use or enjoyment of the real property or any other type of exploitation of the same. Therefore, earnings from property situated in Spain may be taxed in accordance with Spanish law.


The type of taxation will depend on whether the leasing of the property in Spain is considered to be an economic activity. If it is not considered to be an economic activity, it will qualify as return on real estate.

a) Return on real estate

In this case, the rental activity must be limited to making the property available, without rending services ancillary to the hotel industry.

The income to be declared will be the whole amount received from the lessee, without deducting any expenses.

However, in the case of taxpayers resident in another European Union member state and, from 1 January 2015, also in Iceland and Norway, individuals may deduct the expenses provided for in the Personal Income Tax Act for the determination of the gross tax base, or Corporation Tax, in the case of corporate persons, provided that it is certified that such expenses are directly related to the incomes obtained in Spain and have a direct and inseparable link with the activity performed in Spain.

This income is understood to accrue when it is requirable by the lessor or on the collection date, if earlier.

The tax rate applied is the general rate, according to the year of accrual (see chart).

Year of return




2016 and later

Residents in the EU, Iceland and Norway

Other taxpayers

Tax rate



Until 11-07:


From 12-07:



Residents in the EU, Iceland and Norway: 19%

Rest of taxpayers: 24%

Tax return form Form 210, declaring income type 01 or 35.

This will be used both to declare separately each accrual of income and to declare jointly several incomes obtained in a specific period.

Grouping of income: income obtained by the same taxpayer may be grouped together provided that it originates from the same payer, is subject to the same tax rate, and originates from the same property (declaring Income type: 01). However, in the case of income from leased properties not subject to withholding, accrued after 1 January 2018, income originating from several payers may be grouped together provided that the same tax rate is applied and it originates from the same property (in this case declared as Income type: 35). Under no circumstances may Grouped income offset one another.

The grouping period will be quarterly in the case of self-assessments with positive (payable) result, or annual for self-assessments with result nil or refund.

Filing methods::

  • on paper, generated as a result of printing the PDF form available on the Tax Agency website.

    Instruction on how to fill out the form: of non-resident/IRNR/without OCCUPATIONAL DISEASES/Model 210/Information and Assistance/General information

  • Online, via Internet.

Period for presentation: depends on the result of the self-assessment:

  • With positive result: within the first twenty calendar days of the months of April, July, October and January in relation to the income whose accrual date falls within the previous calendar quarter.

    Direct billing of the tax payment: in the case of online filing, payment can be direct-billed between the 1st and 15th days of the months of April, July, October and January.

  • With result nil: from 1 to 20 January of the year following the accrual year for the declared income.

  • With refund result: as of 1 February of the year following the accrual of the income declared and within four years from the end of the period for filing the return and deposit of the withholding. The deadline for filing the self-assessment will be understood to conclude on the date it is filed.

b) Earnings from economic activity obtained from a permanent establishment (PE).

Economic activity will exist carried out through the PE if some of the following conditions are met:

  • at least one person is employed in Spain with a full-time employment contract and is in charge of the management of the activity,
  • if the leasing contract of the holiday home includes the rendering of services ancillary to hotel industry, such as catering, cleaning, laundry and analogous services. These services may be rendered directly or through subcontracts with third parties.

Permanent Establishments must file a Tax return for Payers of Non-Residents' Income Tax (IRNR) on the same Forms and in the same terms as resident entities subject to Corporation Tax.

Tax rate:

For tax periods starting from 1 January 2015, the applicable tax rate is the corresponding rate of those set out in the Corporation Tax regulations. The general tax rate will be 25%. However, 28% will be applied in the 2015 tax period.

Deductions and allowances

EP may apply to their overall amount, the same deductions and allowances as Corporation Tax taxpayers.

Tax period and accrual

The tax period coincides with the fiscal year of the Tax return, and shall not exceed twelve months. The tax is accrued on the last day of the taxable period.

Tax withheld (retenciones) and account deposits (ingresos a cuenta)

PEs are subject to the same withholding regime as entities subject to Corporation Tax for the income they receive.

Payment by instalments

PEs are obliged to pay by instalments under the same terms as those subject to Corporation Tax. The formal obligations regarding instalment payment are the following:

  • Terms: Within the first twenty calendar days of the months of April, October and December.

  • Model: 202

    When instalment payment is not required, it will not be mandatory to file Form 202, except in the case of PEs that are considered Large Companies. In this case, Form 202 must be filed, even when no payment is required, which will result in negative self-assessments.


  • Term: 25 calendar days following the six months after the end of the tax period.

  • Model: 200

Formal obligations

Permanent establishments are obliged to undertake the same accounting, register and formal obligations as resident entities.

Before engaging in such activity, they must apply for registration in the Census of Business Owners, using Form 036. In the case of legal entities, this tax return will also be used to apply for the assignation of the tax ID number of the permanent establishment.

A representative residing in Spain must also be appointed.


Since 2018, new reporting obligations have been established regarding private holiday home rentals, through Form 179, which must be filed by persons or companies that mediate in the rental of holiday homes (either analogically or digitally); and, in particular, the so-called “collaborative platforms” that mediate in these rentals.

IMPORTANT: These new reporting obligations will have full effect in the 2018 Income Tax return campaign, to be filed in 2019, notwithstanding the obligation of declaring incomes received from the rental of holiday homes in the fiscal year in which they accrue, the same as with other returns on real estate investment.

The intermediaries of these operations will inform the Spanish Tax Agency after 2018 of all holiday home rentals taking place in Spain. These include private holiday home rentals (Article 5.e) of the LAU and the seasonal rentals (Article 3 of this Act).

The information to be reported in the new Form 179 includes:

  • Owner of the property
  • Owner of the right in virtue of which the property is rented (if other than the property owner)
  • Identification of the persons or companies renting the property.
  • Property object of rental.
  • Number of days of rental of the holiday home
  • Amount received by the landlord
  • Contract number assigned by the intermediary
  • Start date of the holiday home rental
  • Intermediation date
  • Identification of the means of payment used
ITP (Property Transfer Tax) NOT SUBJECT
Personal Income Tax RETURNS ON REAL ESTATE INVESTMENT (without reductions)
ITP (Property Transfer Tax) Rate set by Autonomous Communities. Failing this, the scale foreseen in Article 12.1 ROYAL DECREE-LAW 1/1993