TAX GUIDE
SPANISH
Spain is still one of the most popular destinations for British expatriates. Having made
the decision to move to Spain, it is essential that you plan prudently in order to optimise
your nances, particularly in relation to the implications of income and capital gains/
savings taxes as well as wealth tax, rental tax, succession tax and gift tax for example.
Tax laws in the UK and Spain differ signicantly and if you are going to manage your
wealth successfully, the support and guidance of a professional who understands all
the relevant cross-jurisdictional issues will be an invaluable asset. As a simple example,
which will be discussed later in this document, winnings and growth from all the com-
mon UK tax efcient savings vehicles such as premium bonds and ISAs are taxable in
Spain.
The contents of this Tax Guide are believed to be correct at the date of publication.
Every care has been taken that the information in this Guide is accurate at the time of
release. However, all information and tax gures are subject to change and you should
always make enquiries, check details and, where necessary, seek legal advice before
entering into any transaction.
The information is for guidance only and does not constitute advice. You should seek
professional tax advice tailored to your needs and circumstances before making any
decision.
Introduction
01
I N D E X
01 Introduction
03 Your residency status and tax
04 Social security and healthcare
05 The UK/Spain double tax treaty
06 Establishingtaxefciency
07 Rental income
08 Spain’s property wealth tax
09 Capital gains on property
10 Undeclared income or
‘black money’
11 Succession laws
12 Wills and probate
13 Inheritance tax
15 Modelo 720
16 Wealth tax
17 Conclusion
02
18 Tax rates in Spain
General income tax
19 Income tax tables
24 Savings income
25 Allowances
26 State wealth tax rates
31 Succession and gift tax
32 Relatives reductions
33 Succession and gift tax state
rates
34 Succession and gift tax multipliers
Your residency status and tax
Tax residency status determines which coun-
try’s tax laws are used to tax your worldwide
income and gains.
United Kingdom Nationals
Since Brexit, United Kingdom nationals no
longer have an automatic right to Residency in
the EU.
U.K. nationals not currently living in Spain
must apply for a residency permit. These can
be granted for study, work, business (for those
looking to start a company in Spain), as a
non-lucrative (non-working) visa, as a family
member of an EU national, or a golden visa for
those investing 500,000 in Spain.
Spanish residency
Spain does not allow split year treatment for
tax status. You are considered tax resident if
you are resident in the country for more than
183 days during the year (January to
December) or if your major sources of income
or economic activity occur in the country.
Family ties may also determine your status
– for example, if your spouse or dependent
children live in the country.
UK residency
In terms of UK tax residency, your status is
determined under the UK Statutory
Residence Test.
Automatic overseas resident
Automatic UK resident
Sufcient ties
• Automatic overseas resident
• Automatic UK resident
• Sufcient ties
In the event you do not meet the
respective criteria for either of the
‘automatic’ residence tests, the third status is
assessed based on the number of days you
are resident in the UK together with an
assessment of your ‘ties’ to the UK.
03
Whatever the case, you should always
seek advice as how to best dene and
process your status and application.
Qualifying ties include:
• Having ‘substantive’ work in the UK
• Having family in the UK
• Having housing or accommodation in the
UK
• Spending more time in the UK than any
other country, together with at least 91
days in the UK over the previous two years
It is important that you seek advice regarding
how any of the above circumstances affect
your residency status.
To get a Visa to live in Spain you must have
Private Healthcare for at least the rst year of
Residency.
Working in Spain
If you are working, you should make sure
you are paying social security to the correct
country. It is important to note that it may not
always be prudent to pay this in the same
country in which the work is actually per-
formed. Any failure in this regard can affect
your ability to receive state pensions, state
healthcare and other benets. Furthermore,
you may incur penalties if you do not follow
the rules and consequently fail to meet your
obligations.
04
Social security and tax status
The UK/Spain double tax treaty
The terms of the UK/Spain Double Tax Treaty
mean it is only possible to be tax resident in
one of the two countries at any given time.
The treaty includes rules to help you establish
your tax residency. However, as your
circumstances may change it is important
that you take regular advice to ensure your
circumstances continue to align with the rules
necessary for your status. Any oversights in
this regard could prove costly.
05
06
Establishing tax eciency
Although the UK/Spain Double Tax Treaty
prevents income from being taxed in both
countries, in some cases it may be possible
to pay tax in the wrong country and to conse-
quently pay more than you need to.
Many expatriates in Spain mistakenly
continue to pay tax in the UK, particularly if
their main source of income is derived from
UK pensions, UK savings or other UK-based
assets. Taking early-stage advice can help
expats establish tax-efcient arrangements
that reduce tax liability and consequently
increase cash flow.
Any failure to declare income to the Spanish
authorities can result in penalties and/or
prosecution for tax evasion. Paying tax in the
UK is no defence in these circumstances. And
although it is possible to offset tax paid in one
country against tax due in the other, this does
not always prove advantageous. It is better
to avoid the higher liability in the rst place.
Finding the arrangement that is most suitable
for the individual is rarely straightforward, so it
is important to take advice regarding the most
tax-efcient arrangement for your circum-
stances.
What is tax efcient in the UK may not be tax
efcient in Spain, and vice-versa. For example
both premium bond winnings and Individual
Savings Accounts (ISAs) are tax-free in the
UK. However, they may attract considerable
tax liability in Spain, so it is likely you may want
to restructure any investments of this type
before you begin residency in the country.
What is tax efcient in the UK may not be tax
efcient in Spain, and vice-versa. For example
both premium bond winnings and Individual
Savings Accounts (ISAs) are tax-free in the
UK.
Furthermore, you may wish to consider the tax
efciency of the following investments when
moving from the UK to Spain:
• Personal Equity Plans (PEPs) – attract
capital gains tax on disposal
• UK pension plans and annuities
• Investment Bonds – Spanish law does
not provide for the same benecial tax-de-
ferred allowance as in the UK
• Open Ended Investment Companies
• (OEICs)
• Investment Bonds
• UK shares – Dividends are taxable in
Spain whether the income is received or
reinvested
• ISAs - Although it is possible to hold on
to an ISA once you have left the UK for
Spain, you will be unable to make any
further contributions to the account.
Furthermore, all income and gains derived
from an ISA are liable for tax in Spain. If
you are becoming, or are already, resident
in Spain, you should consider the myriad
alternative investments available as they
are likely to prove more benecial than an
ISA.
Offshore Bank Interest
The worldwide bank interest income of
residents in Spain is subject to a tax rate of
between 19% and 26% in Spain, regardless of
where in the world the account is situated
and whether it is used to make withdrawals
etc. Furthermore, this rate is subject to limits
imposed by the UK/Spain Double Tax Treaty.
It is worth speaking with your adviser about
the possibility of adding any such interest to
your other income and to tax it accordingly.
Rental income
Rental Income from UK Property
There are more than 1.75 million landlords in the UK and many of these are expats who have
multiple properties in the UK. Often these serve as a kind of proxy pension fund. Others may
have one or more UK properties which they no longer live in, but do not wish to sell because of
personal or familial attachments.
Rental income from UK properties remains taxable in the UK regardless of residency status and
must be appropriately reported in both the UK and Spain. For residents in Spain, UK rental
income is also taxable in Spain, where it is added to all other income and taxed at the scale
rates of tax. However, tax paid in the UK can be offset against the Spanish tax on the same
income.
Residents of Spain with long-term rental agreements are entitled to a 60% reduction against
net rental income; this includes both rental properties owned inside and outside the country.
Furthermore, some expenses are deductible.
Rental income from property in Spain
Renting out Spanish property is a common investment for many expats in Spain. Owning
Spanish property can help you feel connected to the country, provides real-estate security, and
can also provide an invaluable cash flow.
However, all rental income derived from property owned in Spain is subject to tax. For
non-residents of Spain living within the EU or EEA, this income attracts a flat rate tax of 19%
(although mortgage interest, agency fees, repairs, and some other expenses are tax deductible).
Residents from outside the EU or EEA (this now includes the UK) are subject to a higher flat
rate tax of 24% with no allowable deductions.
Note: A license may be required in Spain before you can rent out your property.
07
Spains property wealth tax
Any Spanish properties that are not being lived in and are not being rented out are subject to a
separate tax. This is calculated on the notion that you receive annual income at a rate of 1.1%
of the state-sanctioned valuation of the property if the property has been valued within the past
decade, or at 2% if no valuation has occurred during the preceding ten years.
This income is known as ‘imputacin de rentas inmobiliarias’ and is assumed by the state
regardless of whether you actually receive it or not; as such it is deemed to be taxable. For
residents and non-residents who live in the EU or EEA it is taxed at a flat rate of 19%. A higher
rate of 24% applies to residents outside of the EU and EEA.
Overseas properties owned by residents in Spain attract a similar tax on the notional income.
However, the assumed income is calculated as 1.1% of 50% of the purchase price. This is then
subject to a 19% or 24% tax depending on whether you live within the EU/EEA.
08
Capital gains on property
You are likely to be exempt from capital gains tax on the proceeds from a sale of your main
Spanish residence provided you are over 65 and have lived in the property for at least three
years. Similarly, you will be exempt if you are under 65 and reinvest the entire sum in a new
residence.
The UK/Spain Double Tax Treaty dictates that any gains realised from the disposal of UK
properties attracts Spanish capital gains tax of up to 26%. This is true regardless of whether the
property was your main residence, although you may still qualify for the exemptions outlined
above.
It is worth bearing in mind that you will also be liable for UK capital gains tax for gains accrued
after 6 April 2015, even if you are resident in Spain. Unless you have particular reasons for
owning UK property while residing in Spain it may be worth consulting your adviser about the
potential benets of alternative investments.
09
Undeclared income or “black money”
Not that long ago in Spain many property transactions were borderline in their legitimacy as
neither vendor nor buyer always disclosed the full value of the transaction. Not only is this
practice of under-declaring the purchase price illegal, it can also result in a much larger capital
gains liability than would otherwise apply when the property is sold further down the line. Such
‘black money’ transactions should be avoided.
10
Succession laws
In August 2015 Spain implemented an EU regulation known as ‘Brussels IV’. Under the terms
of Brussels IV, if you reside in Spain you can choose to have UK succession law apply to your
estate, otherwise Spanish succession law will apply automatically upon your death, including if
you die intestate (without a Will).
There may be signicant advantages to electing UK succession law: Spain’s forced heirship
rules do not allow you to choose certain beneciaries – for example stepchildren – while
simultaneously forcing you to hand on as much as half of your estate to your ‘bloodline’ – this
includes children (biological and adopted), spouse, parents and grandparents, regardless of
whether you want this.
You should be aware that if you are a resident in Spain, the country’s succession law will apply
to all your worldwide assets (excluding non-Spanish real estate). As such, careful planning in
relation to succession laws and inheritance taxes is essential.
Note: By stating UK law of Succession it doesn’t mean that you are not subject to Spanish
inheritance tax, it just means you can nominate beneciaries of choice.
11
UK Wills are valid in Spain but can be complicated by the cross-jurisdictional probate process
– the Will needs to be translated and notarised before it will be ready for the Spanish probate
process. It can be a laborious and time-consuming process negotiating cross-border probate
before assets can be distributed.
It is important to be careful and to take advice. Writing a Spanish Will, even if it is just for your
Spanish assets, can potentially invalidate your UK Will and in some cases may even lead to
disputes between your heirs.
Note: You should ensure that it/they encompass your worldwide assets.
12
Wills and probate
Inheritance tax
Inheritance tax in Spain is known as Succession tax (ISD) and unlike the UK it is the beneciary
that is liable for the tax not the Estate.
Both lifetime gifts and bequeathed assets are liable for Spanish succession and gift tax. This is
true for all assets situated in Spain regardless of who the asset/gift has been given to (including
spouses) and applies regardless of the recipient’s country of residence.
As such all of the following assets in Spain attract this tax:
• Property
• Cash
• Stocks
• Valuable items such as paintings or antiques
Tax Obligations of Beneciaries in the UK
Inheritance tax in the UK is paid by the estate. In Spain, succession and gift tax is paid by the
beneciaries. However, just as in the UK, the tax must be paid before the assets can be
released. This can make matters complicated, particularly as in most cases the tax must be paid
within six months of the testator’s death.
The applicable rate of tax is calculated according to the following criteria:
• The relationship between testator (donor) and beneciary (donee).
• The value of what is being passed on.
• The pre-inheritance wealth of the beneciary.
• The respective residence status of the testator and beneciary
13
Rates of tax and exemption thresholds may vary in Spain depending on the rules of the
applicable autonomous region you are residing in. However, sometimes the state rules may
apply and working out which takes precedence can be complicated for the uninitiated.
National tax exemption thresholds are 16,000 for spouses, parents or children older than 21 –
further reductions are available against the value of the main home, although their complicated
nature means it is best to take advice in this regard.
It is important to note that although some autonomous regions have more favourable rates in
place than others, overall there is not a great deal of variance in approach.
Unmarried couples, step-families and succesion law
Spanish succession laws mean that any person who is considered a ‘desconocido’ (stranger
– not married to the deceased or related through marriage) could be liable for a succession or
gift tax of up to 82% on the value of any gifted or inherited asset. However, this level is rarely
applied. Unmarried couples, step-children and other non bloodline families should be prepared
and it is wise to plan carefully in order to reduce tax liability as much as possible.
14
Regional differences
Civil partners and same-sex marriages
Spain recognises same sex marriages performed in other countries and allows same sex
marriage within its own law. However, UK civil partners are not recognised as ‘married’ for tax
and other purposes. To receive marriage legal rights in Spain, including tax benets, you should
therefore seek to convert your civil partnership into a UK civil marriage or a Spanish civil
partnership or “pareja de hecho”.
Modelo 720
The Common Reporting Standard (CRS)
You should declare all your assets and accounts. Spain is signatory to the Common Reporting
Standard, under which almost 100 jurisdictions automatically exchange tax and nancial infor-
mation on a global level. Failure to declare could result in signicant nes and penalties.
All residents of Spain are required by law to declare all assets they hold outside Spain worth
more than 50,000 (total - per asset class), regardless of the holder’s nationality. The reporting
form for these assets is known as Modelo 720.
Modelo 720 divides assets into four groups:
Overseas property
Cash, deposits, ISAs – held in overseas nancial entities
Financial assets (bonds, investments, pensions, insurances) located abroad
Crypto Assets
The Spanish tax agency (Agencia Tributaria) issue nes for any nondisclosure of assets –
there is no limit to how far back nes may be retrospectively imposed for historical incidents of
non-disclosure.
Under Spanish law tax investigations can go back four years, so the income would be deemed
to arise four years prior to the year the asset is discovered and will be taxed at the marginal
rates of income tax. Recently however the European Court of Justice have ruled these nes to
be excessive.
Still, Blacktower Insurance Agents & Advisors Ltd advise all clients to discuss the Modelo 720
with their tax adviser to ensure that they comply with this law and understand its implications
with regards to assets held offshore.
Any person who has assets exceeding a value of 50,000 at 31 December (the ofcial reporting
date) is required to submit a report. Modelo 720 reporting is only required in subsequent years
in the event the value of the assets reported increases by 20,000 on the previous stated value.
You must also report any event involving the sale or closure of an asset previously reported on
the form.
15
Wealth tax
Wealth tax is payable annually on the total net value of your assets at 31 December of that year.
All residents of Spain who meet the threshold for this tax are liable on the total value of their
worldwide assets. Non-residents are liable only for tax on the value of assets located in Spain. It
is important to note that loans are deductible from your net taxable wealth – the exception is if
they have been used to purchase or invest in assets which are exempt from wealth tax.
Wealth tax is payable on the value of most assets, including the following:
• Property
• Art
• Jewellery
• Cars
• Yachts
• Savings
• Investments
• Non EU private pensions (includes Final Salary pensions)
Some assets may be exempt from wealth tax. These include the following:
• Some household contents (not jewellery, fur coats, boats, vehicles, art and antiques)
• Certain family companies meeting certain conditions (not including most property invest-
ment companies)
• Pension pots – EU based only
• Owner-managed small businesses
• Intellectual property rights owned by the author/creator/artist
• Business assets where income from the business make up at least 50% of the individual’s
taxable income and meet certain other criteria
Spanish wealth tax is effectively a tax on capital assets. There is no comparable tax in the UK
and it can be very difcult to plan for without advice. Furthermore, wealth tax rates may vary
depending on the autonomous region in which you or your assets are located. There are limits
to Spanish wealth and income tax and this means that there are ways to limit your liability by
intelligently managing your assets alongside your total income. It is best to seek advice in this
regard.
16
Conclusion
Professional, expert advice is critical to effectively manage your tax liability in Spain, particularly
if there are possible cross-jurisdictional and language issues to consider.
Spain’s taxation and succession laws differ markedly from those in the UK – sometimes this
may work to your personal advantage, but at other times it may not. It is only by carrying out a
full analysis of your situation and with careful planning that you can feel condent of striking a
balance that most closely aligns with the interests of you and your family.
At Blacktower, we understand that everyone is different and it is important your adviser has an
understanding of you, your circumstances, your long-term goals and your cash-flow needs. We
take the time to get to know you and will answer your investment, savings and retirement
planning questions so that we may provide a truly bespoke service.
The contents of this Tax Guide are believed to be correct at the date of publication. Every care has been taken that
the information in this Guide is accurate at the time of release. However, all information and tax gures are subject to
change and you should always make enquiries, check details and, where necessary, seek legal advice before entering
into any transaction. The information is for guidance only and does not constitute advice. You should seek
professional tax advice tailored to your needs and circumstances before making any decision.
17
Income tax
You should declare all your assets and accounts. Spain is signatory to the Common Reporting
Standard, under which almost 100 jurisdictions automatically exchange tax and nancial infor-
mation on a global level. Failure to declare could result in signicant nes and penalties.
All residents of Spain are required by law to declare all assets they hold outside Spain worth
more than 50,000 (total - per asset class), regardless of the holder’s nationality. The reporting
form for these assets is known as Modelo 720.
Savings income includes:
Interest on savings
Shareholder dividends
Income from annuities
Income derived from life assurance contracts
Capital gains on the sale/transfer of assets
General Income, not categorised as savings-related, includes:
All earned income (i.e. salary, self-employment and pension income)
Income from rental properties
Notional rental income (imputacin de rentas inmobiliarias)
Royalties
Any imputed income and gains not made on the sale/transfer of assets (for example, from
lottery/gambling)
General income tax
Income tax rates are made up of a state tax plus a regional tax. Each autonomous community
sets their own local rates.
The following pages contain the 2022 tables for the regions most popular with expatriates.
Tax rates in Spain
18
Income tax tables
Andalucia
Taxable base
from Euros
Taxable base
to Euros
National tax
rate
Regional tax
rate
Total tax
rate
Tax on band Cumulative
tax
0.00 12,450.00 9.50% 9.50% 19% 2,365.50 2,365.50
12,450.01 20,200.00 12% 12% 24% 1,860.00 4,225.50
20,200.01 35,200.00 15% 15% 30% 4,500.00 8,725.50
35,200,01 60,000.00 18.50% 18.50% 37% 9,176.00 17,901.50
60,000,01 300,000.00 22.50% 22.50% 45% 108,000.00 125,901.50
300,000.01 Onwards 24.50% 22.50% 47% - -
Cataluna
Taxable base
from Euros
Taxable base
to Euros
National tax
rate
Regional tax
rate
Total tax
rate
Tax on
band
Cumulative
tax
0.00 17,707.20 12% 12% 24% 4949.73 4949.73
17,707.20 33,007.20 14% 14% 28% 4284.00 9233.73
33,007.20 53,407.20 18.5% 14% 32.5% 6630.00 15863.74
53,407.20 90,000.00 21.5% 18.5% 40% 14637.12 30500.85
90,000.00 120,000.00 23.5% 18.5% 42% 12600.00 43100.00
120,000.00 175,000.00 24% 21.5% 46% 23300.00 68400.85
175,000.00 Onwards 25.5% 21.5% 47% - -
~
19
Comunidad Valenciana
Taxable base
from Euros
Taxable base
to Euros
National tax
rate
Regional tax
rate
Total tax
rate
Tax on
band
Cumulative
tax
0.00 12,450.00 9.50% 9.50% 19% 2,428.00 2,428.00
12,450.01 17,000.00 12% 11% 23% 1,047.00 3,474.00
17,000.00 20,200.00 12% 13.9% 25.9% 829.00 4,303.00
20,200.00 30,000.00 15% 13.9% 28.9% 2,832.00 7,135.00
30,000.00 35,200.00 15% 18% 33% 1,716.00 8,851.00
35,200.00 50,000.00 18.5% 18% 36.5% 5,402.00 14,253.00
50,000.00 60,000.00 18.5% 23.5% 42% 4,200.00 18,453.00
60,000.00 65,000.00 22.5% 23.5% 46% 2,300.00 16,553.00
65,000.00 80,000.00 22.5% 24.5% 47% 7,050.00 23,603.00
80,000.00 120,000.00 22.5% 25% 47.5% 19,000.00 42,603.00
120,000.00 140,000.00 22.5% 25.5% 48% 9,600.00 52,203.00
140,000.00 175,000.00 22.5% 27.5% 50% 17,500.00 69,703.00
175,000.00 300,000.00 22.5% 29.5% 52% 65,000.00 134,703.00
300,000.00 Onwards 23.5% 29.5% 53% - -
20
Islas Baleares
Taxable base
from Euros
Taxable base
to Euros
National tax
rate
Regional tax
rate
Total tax
rate
Tax on
band
Cumulative
tax
0.00 10,000.00 9.50% 9.50% 19% 1,900.00 1,900.00
10,000.00 12,450.00 9.5% 11.75% 21.25% 521.00 2,421.00
12,450.00 18,000.00 12% 11.75% 23.75% 1,318.00 3,739.00
18,000.00 20,200.00 12% 14.75% 26.75% 589.00 4,327.00
20,200.00 30,000.00 15% 14.75% 29.75% 2,916.00 7,243.00
30,000.00 35,200.00 15% 17.75% 32.75% 1,703.00 8,946.00
35,200.00 48,000.00 18.5% 17.75% 36.25% 4,640.00 13,586.00
48,000.00 60,000.00 18.5% 19.25% 37.75% 4,530.00 18,116.00
60,000.00 70,000.00 22.5% 19.25% 41.75% 4,175.00 22,291.00
70,000.00 90,000.00 22.5% 22% 44.50% 8,900.00 31,191.00
90,000.00 120,000.00 22.5% 23% 45.50% 13,650.00 44,841.00
120,000.00 175,000.00 22.5% 24% 46.50% 25,575.00 70,416.00
175,000.00 300,000.00 22.5% 25% 47.50% 59,375 129,791.00
300,000.00 Onwards 23.5% 25% 48.50% - -
21
Islas Canarias
Taxable base
from Euros
Taxable base
to Euros
National tax
rate
Regional tax
rate
Total tax
rate
Tax on
band
Cumulative
tax
0.00 12,450.00 9.50% 9.50% 19% 2,366.00 2,366.00
12,450.00 17,707.00 12% 12% 24% 1,262.00 3,627.00
17,707.00 20,200.00 12% 14% 26& 648.00 4,275.00
20,200.00 33,007.00 15% 14% 29% 3,714.00 7,989.00
33,007.00 35,200.00 15% 18.5% 33.5% 735.00 8,724.00
35,200.00 53,407.00 18.5% 18.5% 37% 6,737.00 15,461.00
53,407.00 600,000.00 18.5% 23.5% 42% 2,769.00 18,230.00
60,000.00 90,000.00 22.5% 23.5% 46% 13,800.00 21,030.00
90,000.00 Onwards 22.5% 24% 46.5% - -
22
Murcia
Taxable base
from Euros
Taxable base
to Euros
National tax
rate
Regional tax
rate
Total tax
rate
Tax on
band
Cumulative
tax
0.00 12,450.00 9.50% 10% 19.5% 2,428.00 2,428.00
12,450.00 20,200.00 12% 12.5% 24.5% 1,899.00 4,327.00
20,200.00 34,000.00 15% 15.5% 30.5% 4,209.00 8,536.00
34,000.00 35,200.00 15% 19.5% 34.5% 414.00 8,950.00
35,200.00 60,000.00 18.5% 19.5% 38% 9,424.00 18,374.00
60,000.00 Onwards 22.5% 23.5% 46% - -
23
Savings income
Capital gains tax / Savings tax
Taxable base from Euros Taxable base to Euros Total tax rate
0.00 6,000.00 19%
6,000.1 50,000.00 21%
50,000.1 200,000.00 23%
00,000.01 Onwards 26%
Wealth Tax Rates and Allowances
Wealth tax is payable annually on the total net value of your assets at 31 December of that year.
Residents of Spain are liable for the total value of their worldwide assets. Non-residents are
liable only for assets located in Spain.
24
Allowances
Assets Residents worldwide Euros Non-residents Spanish
assets only Euros
DEDUCTIONS Individual main
Home
700,000.00
300,000.00
700,000.00
None
EXAMPLE Married couple
2 x Individual
2 x Main home
1,400,000.00
600,000.00
1,400,000.00
None
TOTAL ALLOWANCES AVAILABLE 200,000.00 1,400,000.00
The above assumes a main home value in excess of 600,000 and all assets held in joint names.
For lower value property, the balance of allowance cannot be offset. Autonomous regions can
and do vary the allowances and rates. Wealth tax is an individual tax and joint tax returns are not
permitted.
Please note: The Catalua individual deduction has fallen from 700,000 to 500,000.
The Comunidad Valenciana individual deduction has fallen from 700,000 to 500,000.
Andaluca has a personal allowance for Wealth Tax of 700,000 and a main residence allowance
of 300,000 (each).
25
Wealth tax rates
From Euros To Euros Tax rate Tax on band Cumulative tax
0.00 167,129.00 0.2% 334.26 334.26
167,129.00 334,252.00 0.3% 501.37 835.63
334,252.00 668,499.00 0.5% 1,671.24 2,506.87
668,499.00 1,336,999.00 0.9% 6,016.50 8,523.37
1,336,999 2,673,999 1.3% 17,381.00 25,904.37
2,673,999 5,347,998 1.7% 45,457.98 71,362.35
5,347,998.00 10,695,996.00 2.1% 112,307.96 183,670.31
10,695,996 Onwards 2.5% - -
Andalucia
The Spanish tax regulations state that cumulative wealth and income taxes cannot exceed 60%
of a resident’s total taxable income (there is no limit for non-residents), subject to a minimum of
20% of the wealth tax calculation.
26
Cataluna
~
From Euros To Euros Tax rate Tax on band Cumulative tax
0.00 167,129.00 0.210% 350,97 350,97
167,129.00 334,253.00 0.315% 877,41 1,228,38
334,252.00 668,500.00 0.525% 2,632,21 3,860,59
668,499.00 1,336,999.00 0.945% 8,949,54 12,810,13
1,336,999 2,673,999 1.365% 27,199,58 40,009,71
2,673,999 5,347,998 1.785% 74,930,46 114,940,17
5,347,998.00 10,695,996.00 2.205% 192,853,82 307,793,99
10,695,996 Onwards 2.750% 294,114,15 601,908,14
27
From Euros To Euros Tax rate Tax on band Cumulative tax
0.00 167,129.00 0.25% 418 418
167,129.00 334,253.00 0.37% 618 1,036
334,253.00 668,500.00 0.62% 2,072 3,109
668,500.00 1,336,999.00 1.12% 7,487 10,596
1,336,999 2,673,999 1.62% 21,659 32,255
2,673,999 5,347,998 2.12% 56,689 88,944
5,347,998.00 10,695,996.00 2.62% 140,118 229,061
10,695,996 Onwards 3.12% - -
Comunidad Valenciana
28
Islas Baleares
From Euros To Euros Tax rate Tax on band Cumulative tax
0.00 170,472 0.28% 477 477
170,472 340,937 0.41% 699 1,176
340,937 681,869 0.69% 2352 3,529
681,869 1,336,739 1.24% 8,120 11,649
1,336,739 2,727,479 1.79% 24,894 36,543
2,727,479 5,454,958 2.35% 64,096 100,639
5,454,958 10,909,915 2.90% 158,194 258,833
10,909,915 Onwards 3.45% - -
Islas Canarias
*State wealth tax rates apply
29
Murcia
From Euros To Euros Tax rate Tax on band Cumulative tax
0.00 167,129 0.24% 401 401
167,129 334,254 0.36% 602 1003
334,253 668,500 0.6% 2,005 3,008
668,500 1,336,999 1.08% 7,220 10,228
1,336,999 2,673,999 1.56% 20,857 31,085
2,673,999 4,347,998 2.04% 54,550 85,635
5,347,998 10,695,996 2.52% 134,770 220,404
10,695,996 Onwards 3% - -
30
Succession and gift tax
Rates vary across each autonomous region, and notably in Andaluca, Murcia, Comunidad
Valenciana, Catalua, Madrid, Islas Baleares and Islas Canarias.
The following are national rates:
Group1 Natural and adopted children and other de-
scendants (e.g. grandchildren, great-granchil-
dren etc) under 21
Group 2 Natural and adopted children and other
descendants aged 21 and over. Ascendants
(e.g. grandparents , great-grandparents etc)
spouses.
Group 3 In-laws and their ascendants/descendants*
Step-children* , brothers, sisters, cousins.
Nieces and nephews
Aunts and Uncles
Group 4 All others including unmarried partners even
if they have registered as a pareja de hecho
(a de facto couple). However, in some re-
gions pareja de hecho are treated as married
couples for succession and gift tax purposes,
provided certain requirements are met.
First, beneciaries are divided into the following four groups, depending on the closeness of
relationship to the donor or deceased
31
Relative Reductions
There are no state reductions for life-time gifts. The tax-free state relatives’ reduction for
inheritances received by members of the different groups are as follows
Group1 15,956 with extra 3,990 for each year less
than 21 years old, up to a maximum of 47,858
Group 2 15,956 Euro
Group 3 7,993 Euro
Group 4 nill
32
Succession and gift tax state rates
From Euros To Euros Tax rate Cumulative tax
0.00 7,993 7.65% 612
7,993 15,981 8.5% 1,290
15,981 23,968 9.35% 2,037
23,968 31,956 10.2% 2,852
31,956 39,943 11.05% 3,735
39,943 47,930 11.9% 4,685
47,930 55,918 12.75% 5,704
55,918 63,906 13.6% 6,790
63,906 71,893 14.45% 7,944
71,893 79,881 15.3% 9.166
79,881 119,758 16.15% 15,606
119,758 159,635 18.7% 23,063
159,635 239,389 21.5% 40,011
239,389 398,778 25.5% 80,655
398,778 797,555 29,75% 199,291
Over 797,555 34% -
Tax liability is dependent on the relationship between donor and recipient and the
preexisting wealth of the recipient – multipliers apply.
33
Succession and gift tax multipliers
Net worth of donee
From Euro To Euro
Group 1 and 2
(Ascendants,
descendants,
spouses)
Group 3
(2nd & 3rd relatives)
Group 4 (others)
Nil 402,678 1,0000 1,5882 2,0000
402,678 2,007,380 1,0500 1,6676 2,1000
2,007,380 4,020,771 1,1000 1,7471 2,2000
Over 4,020,771 1,2000 1,9059 2,4000
For region specic tax rates, please contact Blacktower directly and we will be happy to help.
34
Barcelona
Tel: +34 935 47 73 63
Avinguda del Portal de l’ngel, 36 2, 1, 08002 Barcelona, Spain
Costa Blanca
Tel: +34 965 05 82 12
Avinguda d’Ausis March 9 Local 7 (Esquina, Carrer de Joan Fuster, 03730 Xbia, Alicante,
Spain
Costa Calida
Tel: +34 968 18 73 31
120 Avenida Dr. Artero Guirao 2C, 30740 San Pedro del Pinatar, Murcia, Spain
Costa del Sol
Tel: +34 952 81 64 43
Centro Idea, Carr. de Mijas, KM3.6, Local A44, 29650, Mlaga, Spain
www.blacktowerfm.com
info@blacktowerfm.com
Contact us
36
This communication is for informational purposes only based on our understanding of current
legislation and practices which is subject to change and is not intended to constitute, and should
not be construed as, investment advice, investment recommendations or investment research. You
should seek advice form a professional adviser before embarking on any nancial planning activi-
ty. Whilst every eort has been made to ensure the information contained in this communication is
correct, we are not responsible for any errors or omissions.
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