Property portals and rental platforms to pass on landlord details to the Spanish Tax Authorities. Are you prepared?

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HomeAway, AirBnb and other property portals and estate agencies have been busy informing their clients they will disclose all their tax details over to the Spanish Tax Office in 2019, retroactively as from the 1st of January 2018. Are you up to date with your Spanish taxes? Have you been declaring and paying tax in Spain on your rental income? We file taxes all over Spain.

Marbella-based Larrain Nesbitt Lawyers has over 16 year’s taxation & conveyancing experience at your service. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain. You can review here our client’s testimonials.

Blog post copyrighted © 2018 and 2019. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Lawyer – Abogado
7th of January 2019

You may have received last December 2018 an email from your property portal or estate agency similar to this one.

Property portals have been scrambling to send frantic emails over the last month to expat clients (‘hosts’, in their terminology) informing them that going forward they will be passing on all their tax details over to the Spanish Tax Authorities as from the 1st of January 2019. They will request you complete a tax form that will be relayed over to the tax office. If you fail to comply, you will no longer be allowed to do business with them.

So what does all this even mean? It means that estate agents and property portals have been forced to turn into whistleblowers reporting all your rental income under threat of heavy fines.

The reason is because new tax laws now force estate agents and property portals to pass on all your (rental) tax details over to the Spanish Tax Office under threat of humongous fines up to €600,000. Property portals and agents must submit a new quarterly tax form (number 179) to the tax Authorities with very detailed information on all their client’s rentals. If you have been renting out in Spain your property over the last year, and have not declared and paid tax on your income, chances are the tax office already knows about it and you are going to be fined.

The details passed on to the tax Authorities will be retroactive as from the 1st of January 2018. However, I must stress this does not preclude the fact that the Spanish Tax Office is entitled to collect taxes going back four years (statute of limitations).

In Spain, when you rent out a property you are taxed at source.

In other words, you need to declare and pay taxes on your rental income in Spain, not elsewhere i.e. in your home country. Depending on whether there is a double taxation treaty in force with your home country (i.e. such as with the UK and the RoI), your national tax office will give you tax breaks on the tax you have already paid in Spain.

On being non-resident and owning property in Spain, you are liable for the following two taxes:

  • As a non-resident, when you own property in Spain you should be paying an annual end-of-year tax called Non-Resident Imputed Income Tax (even if you do not rent out your property). More information on this tax here: Non-Resident Imputed Income Tax (Fiscal Representation Service) – 8th October 2018
  • If you do rent out your Spanish property, either long-term or as a holiday letting, you must file in addition to the above, a quarterly income tax declaration. Generous landlord tax relief is available for all EU-residents. More information on this quarterly income tax here: Holiday Rental Taxation in Spain – 8th July 2018.

The most interesting part of our taxation service, is that if you are EU-resident we can bring down your tax bill by an average of 70% on applying for lenient landlord tax relief. Ask us.

We offer two different taxation services which are very competitively priced. The service is provided always by native English-speaking lawyers and economists.

Fines for non-payment of tax on rental income range from 50 to 150% of the undeclared amounts, plus delay interests.

Any unpaid tax can be placed as a charge against your Spanish property.

If you are not up to date with your Spanish taxation, don’t procrastinate any longer; contact us ASAP and see how we can help you out to file past tax quarters.

Be pro-active, do not allow the Spanish taxman to slap you a huge fine in 2019!

We offer the most competitive fees in the market. We files taxes all over Spain.

Non-Resident Imputed Income Tax (Fiscal Representation Service) €90/year

Holiday Rental Accounting Service (HRAS) €100/tax quarter

We are specialized in taxation

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, conveyancing, inheritance and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form.

Tax & legal services available from Larraín Nesbitt Lawyers:

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SPI Member Comments

Thoughts on “Property portals and rental platforms to pass on landlord details to the Spanish Tax Authorities. Are you prepared?”

  • Raymundo Larraín Nesbitt says:

    Thank you for your kind words Rojoybago.
    One can only do so much to warn taxpayers of the changes afoot.
    The problem with self-complacency and brushing this matter under the rug, is that the Spanish government is struggling to have its budget approved (as reported at large by the media). This is because it needs to raise an extra 5 to 10 billion euros. So, the tax office in 2019 is going to be quite ‘overzealous’.
    The government has given orders to raise additional revenue through taxes. It is no secret the majority of non-resident landlords did not file and pay quarterly tax returns, whether out of neglect or deliberately. The tax obligation has been there since 2004, it’s not new. But the tax office had no reliable information on who these people were – until now. This has now changed following new tax laws and with the advent of the CRS.
    The fact that the Spanish Tax Office is being spoon-fed detailed information by holiday platforms and other intermediaries, retroactively as from the 1st of January 2018, means the tax office knows who is renting out and who is not paying their taxes.
    If landlords want to chance it risking a humongous fine, that’s their prerogative. My job is to tell people what’s changed and how to pre-empt huge fines. I find it doubtful the tax office would have gone into such lengths over the last two years compiling all this tax information on taxpayers, approving new tax laws and creating new tax forms (i.e. 179) if they were not planning to act upon it (soon). Some people will bury their heads into the sand and hope for the best. I would rather be pro-active, file my tax returns and dodge a massive fine than wait to see what happens.
    As we point out, we are reducing taxpayer’s bills by 70%, on average. Which translates into very little tax actually being paid, legally.
    You are welcome.
    Best

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