Non-resident income tax (IRNR) and modelo 210: who files it and when

If you own a flat on the Costa del Sol, rent out a villa in Mallorca or simply keep a holiday home that sits empty most of the year, you probably have a Spanish tax obligation even though you live elsewhere. It is called the Impuesto sobre la Renta de No Residentes (IRNR), the non-resident income tax, and it is declared on modelo 210. Many foreign owners only discover it when a letter arrives from the tax authority, the AEAT (Agencia Estatal de Administración Tributaria, Spain’s equivalent of the IRS or HMRC). This guide explains from scratch who files it, what is taxed and when to act.

Who is a non-resident, and who files modelo 210?

In general, you are a tax resident in Spain if you spend more than 183 days a year here, if your main economic interests are based here, or if your spouse and dependent children live here under certain conditions. If none of that applies, you are a non-resident. Your tax residence is decided by these rules, not by your passport or by whether you hold a NIE (Número de Identidad de Extranjero, the tax identification number every foreigner needs for property or business matters in Spain).

Non-residents are taxed only on income obtained in Spain. Modelo 210 is the standard form for those who earn it without a permanent establishment (a fixed place of business) in the country. Typical cases are rental income from a Spanish property, capital gains, some pensions and interest or dividends not already taxed at source. Companies operating through a Spanish branch follow a different route, similar to Spanish companies.

Empty homes and rentals: the two situations that catch owners out

Imputed income on properties you do not rent. Spanish law treats a second home that is not rented out as if it produced a benefit for its owner. You therefore pay tax on a notional figure, called renta imputada (imputed income), calculated as a small percentage of the property’s cadastral value (the value the land registry assigns for tax purposes, shown on your IBI property tax bill). The percentage is lower when that value has been recently revised and higher when it has not. The tax applies to the resulting amount even though you received no money. It is declared separately for each property, and the deadline is usually the year following the one in question; check the exact period on the AEAT site for each tax year.

Rental income. If you let a property, you declare the rent received. The key difference between owners lies in expenses. Residents of an EU or EEA country (with which Spain exchanges tax information) can generally deduct costs such as mortgage interest, community fees, insurance, repairs and depreciation. Residents of other countries, such as the UK after Brexit, the US or Switzerland, are generally taxed on the gross rent with no deductions. Rental filings are normally made quarterly, shortly after each quarter ends, although in some cases a single annual filing is allowed.

EU vs non-EU rates, deadlines and practical points

The headline rates differ: income of EU/EEA residents is usually taxed at a lower flat rate than that of non-EU residents, which is higher. Capital gains from selling property have their own rate, and the buyer must withhold part of the price and pay it to the AEAT as an advance on your tax. Rates, thresholds and deadlines are updated from time to time, and the treatment of non-EU owners has been under legal and political debate in Europe. Always check the figures in force for the tax year you are filing, and keep in mind that a double tax treaty between Spain and your country may reduce the bill or give you a credit at home.

Some practical points:

• Each owner of a property files separately for their own share, including spouses and co-owners.
• You need a NIE and a way to identify yourself electronically (digital certificate, Cl@ve or a representative). Many non-residents appoint a tax representative in Spain.
• Filing late brings surcharges and interest, even if no tax is due. A zero-tax return is still a return.
• Keep invoices and contracts. For EU residents they are what justifies the deductions.

At Zythos Business we work every day with self-employed professionals and small companies, and a growing number of our clients are foreigners with Spanish property or activities. We check your residence status, work out which modelo applies, prepare and file your returns on time and keep your paperwork in order, so a holiday home or a rental flat stays a source of income and not of surprises from the tax authority.