Tax in Spain

Who is the tax authority in Spain?

The Agencia Estatal de Administración Tributaria (AEAT) — Agencia Tributaria — is the principal Spanish tax authority, established by Article 103 of Law 31/1990 and operational from 1992. The AEAT administers personal and corporate income tax (IRPF, IS), Value Added Tax (IVA), excise duties, customs, the wealth tax (Impuesto sobre el Patrimonio), and the Solidarity Tax on Large Fortunes. Spain's tax administration is partially decentralised: the seventeen Autonomous Communities (Comunidades Autónomas) hold legislative competence over part of the IRPF base and the autonomous-community surcharge rates, plus full competence over Inheritance and Gift Tax (Impuesto sobre Sucesiones y Donaciones), the wealth tax (in most cases), and Property Transfer Tax (ITP) [SC1][SC2]. The Basque Country and Navarre operate completely separate Foral tax systems administered by the Diputaciones Forales (in Bizkaia, Gipuzkoa, Álava) and the Hacienda Foral de Navarra. The Tribunal Económico-Administrativo Central handles tax disputes administratively before recourse to the Audiencia Nacional. Economistas registered with the Consejo General de Economistas and Asesores Fiscales registered with the Asociación Española de Asesores Fiscales (AEDAF) are the principal credentialed tax-and-accounting professions. The taxpayer-facing portal is sede.agenciatributaria.gob.es.

What is the Spanish tax year and the filing deadline?

The Spanish tax year for individuals is the calendar year (1 January – 31 December). The annual IRPF return — Modelo 100 — is filed during the Renta campaign, which typically opens in early April and closes at the end of June following the tax year [SC3]. Specific year-by-year dates are announced annually by the AEAT; the campaign for tax year 2025 runs approximately April–June 2026. Filers receive a pre-populated draft return (the borrador) generated by AEAT from third-party reporting; most filers can confirm or amend the borrador online through the Renta WEB tool. Tax owed can be paid in full or in two instalments (60 percent at filing, 40 percent in early November). Companies file IS Modelo 200 within 25 days of the six-month-and-twenty-five-day window following fiscal year-end (so a calendar-year company files by 25 July of the following year). Quarterly fractional payments (pagos fraccionados) apply for IS at 18 percent of prior-year quota or graduated rates of taxable income for larger entities. VAT returns (Modelo 303) are filed quarterly or monthly depending on size.

How is Spanish tax residency determined?

Under Article 9 of Law 35/2006 (the IRPF Law), an individual is a Spanish tax resident for a tax year if any of three tests is satisfied: physical presence in Spain for more than 183 days in the calendar year (with sporadic absences computed under Article 9.1.a as Spanish-resident days unless the filer can demonstrate tax residency elsewhere); the principal centre of economic interests is in Spain (a facts-and-circumstances test focused on assets, income generation, and business activities); or a presumption that the spouse-not-legally-separated and dependent minor children habitually resident in Spain triggers the filer's residency unless the filer demonstrates otherwise [SC8]. Treaty residency tie-breakers under Spain's bilateral DTAs apply where two jurisdictions both treat a person as resident.

Residents are taxed on worldwide income; non-residents on Spanish-source income only under the Impuesto sobre la Renta de no Residentes (IRNR). Spain operates the regime de impatriados (the 'Beckham Law' under Article 93 of the IRPF Law), allowing qualifying inbound workers and now self-employed entrepreneurs and remote workers to elect for non-resident-style flat-rate taxation on Spanish-source income (24 percent up to EUR 600,000, 47 percent above) for up to six tax years; the 2023 reform widened eligibility materially. The Modelo 720 declaration of foreign assets above EUR 50,000 by category is required from residents, with significant penalty regime restructured after the CJEU ruling in C-788/19 (2022) struck down the historical disproportionate-penalty framework.

How does Spanish personal income tax work?

Spanish IRPF is split into a state portion and an autonomous-community portion, each applying its own bracket structure. The state portion of the general taxable base for 2025 has rates of 9.5 percent up to EUR 12,450, 12 percent up to EUR 20,200, 15 percent up to EUR 35,200, 18.5 percent up to EUR 60,000, 22.5 percent up to EUR 300,000, and 24.5 percent above [SC4]. Each autonomous community sets its own equivalent rate structure for the same base, with combined state-plus-autonomous top rates ranging from approximately 45 percent (in some autonomous communities) to over 54 percent (in Comunidad Valenciana, La Rioja, and Cataluña at the highest brackets). Madrid maintains one of the lower combined top rates near 45 percent. The Basque and Navarrese Foral systems operate completely separate brackets — typically running below the state-plus-AC combined rates.

Savings income — interest, dividends, capital gains — is taxed under a separate savings-base schedule with state-plus-AC combined rates of 19 percent up to EUR 6,000, 21 percent up to EUR 50,000, 23 percent up to EUR 200,000, 27 percent up to EUR 300,000, and 28 percent above (the higher brackets above EUR 200,000 added from 2023 and adjusted in subsequent annual budget laws) [SC4]. The general-base personal allowance (mínimo personal y familiar) is approximately EUR 5,550 for filers under 65, with additional allowances for age, dependants, and disability.

How does Spanish corporate tax work?

The principal corporate income tax — IS (Impuesto sobre Sociedades) — has a standard rate of 25 percent on taxable profits, in force since 2016 [SC4]. A reduced rate of 15 percent applies to newly-created companies in their first profitable tax period and the following one (with anti-avoidance rules limiting use by group-restructuring entities). A reduced rate of 20 percent applies to qualifying cooperatives. From 1 January 2025 (per the post-2024 budget law), a reduced rate of 23 percent applies to micro-companies (turnover under EUR 1 million) on the first EUR 50,000 of taxable income and 25 percent above; small companies (turnover under EUR 10 million) face 24 percent on the first EUR 300,000 and 25 percent above, with the rate stepping down across multiple years to 20 percent by 2029. Spain implemented the OECD Pillar Two Global Anti-Base Erosion (GloBE) rules through Law 7/2024 with the Income Inclusion Rule and Domestic Top-up Tax applying for fiscal years beginning on or after 31 December 2023, for groups with consolidated revenue above EUR 750 million [SC5]. The Spanish CFC regime under Article 100 of the IS Law and the participation-exemption regime under Article 21 of the IS Law operate alongside.

How does indirect tax work in Spain?

Value Added Tax — IVA (Impuesto sobre el Valor Añadido) — is the principal indirect tax, applying within the EU VAT Directive framework. The standard rate is 21 percent. The reduced rate is 10 percent (food not at zero or super-reduced, hotel accommodation, restaurant meals, public passenger transport, residential property sales). The super-reduced rate is 4 percent (basic food including bread, milk, cheese, eggs, fruit, vegetables, books, newspapers, and certain medicines). A 0 percent temporary rate applied to the most basic foodstuffs in 2023–2024 as inflation relief; the precise current schedule reflects the most recent budget-law extensions and reductions [SC4]. The mandatory IVA registration threshold for residents is EUR 0 — registration is generally required from the start of taxable activity, with the Recargo de Equivalencia simplified regime for small retailers. Cross-border digital and remote services to Spanish consumers are taxed under the EU OSS/IOSS framework. Electronic invoicing for B2B has been mandated by the post-Crea y Crece Law framework, with phased rollout from 2025.

How is crypto taxed in Spain?

The AEAT treats cryptoassets as financial assets generating capital-gain or savings-base income for individual filers. Capital gains on disposal — sale for fiat, exchange between different cryptoassets, or use to acquire goods or services — are included in the savings base and taxed at the 19/21/23/27/28 percent savings-base schedule [SC5]. Disposals between cryptoassets are taxable, calculated on the fair market value of the cryptoasset received against the cost basis of the cryptoasset disposed of. Mining and staking rewards are taxable as economic-activity income or capital-yield income depending on characterisation, at fair market value on receipt. Receipt of crypto as compensation is taxable as employment income at fair market value on receipt.

Spain operates two specific crypto-reporting obligations on residents: Modelo 721 (the foreign-crypto-platform declaration) for crypto held with non-Spanish exchange or custody platforms above thresholds, and Modelo 172/173 (third-party reporting by Spanish platforms) on customer balances and transactions. Failure to file Modelo 721 carries fixed penalties under the post-CJEU-restructured framework. Wealth Tax and the Solidarity Tax on Large Fortunes apply to crypto holdings above the relevant residency-based wealth thresholds.

How does Spain handle tax treaties?

Spain maintains a network of approximately 95 comprehensive Double Taxation Conventions in force, covering most of Spain's trading and investment partners [SC5]. Most Spanish treaties follow the OECD Model with Spain-specific reservations, particularly on the credit-versus-exemption method (Spain generally applies the exemption-with-progression method for most income from treaty partners and the credit method for non-treaty cases). Spain signed and ratified the OECD Multilateral Instrument; the MLI's modifications, including the Principal Purpose Test, apply to many of Spain's covered DTCs for periods from 2022 onward. EU intra-group flows benefit from the Parent-Subsidiary Directive and the Interest-Royalties Directive within scope. Foreign tax-credit relief is generally claimed under Articles 80 and 91 of the IRPF Law (for individuals) and Article 31 of the IS Law (for corporations).

What are the common penalties and pitfalls for foreigners?

Late filing of an IRPF return triggers a surcharge under Article 27 of the General Tax Law: 1 percent plus 1 percent for each additional month of delay up to 12 months (capped at 15 percent), or 15 percent plus interest from month 13 onwards [SC1]. Late payment of self-assessed tax (without filing a return) triggers a 5 percent surcharge if paid within 3 months, 10 percent within 6 months, 15 percent within 12 months, and 20 percent plus interest thereafter. Penalties for inaccuracy under Article 191 General Tax Law range from 50 percent (leve, minor) to 100 percent (grave) to 150 percent (muy grave) of the tax under-declared, with reductions for cooperative-disclosure procedures.

Common pitfalls for arrivals to Spain include: failing to time emigration around the calendar-year residency cut-over (mid-year arrivals create full-year residency exposure); missing the post-2023 Beckham-Law widened eligibility for self-employed entrepreneurs and remote workers; underestimating the autonomous-community surcharge variation when comparing tax positions across regions; and missing the Modelo 720 / Modelo 721 foreign-asset and foreign-crypto declarations. For complex residency, regime-elective, or cross-border scenarios, common approaches discussed by practitioners include consulting a credentialed Asesor Fiscal before relying on a single-test conclusion.