Short-term rental, also known as a holiday rental and tourist accommodation is described as the rental of any property that is located outside a rural area and is not attached to a group of three or more units in the same building for less than two months by the same tenant and in exchange for income.
Short-term rental properties can be rented in whole or in part, as private rooms for up to 15 different tenants, in the case of an entire property, or to up to six tenants, if the landlord lives in the property as his or her permanent residence.
Properties that are let out to relatives or family members for a short term are not considered holiday rentals.
There is no specific rule regarding the maximum number of days a holiday accommodation can be rented all through the year in Spain but generally, the short-term rental should be rented for less than 2 months for every guest or tenant.
There is no national rule regarding short-term rental in Spain instead there are autonomous provincewide, community, and regional laws. Some regions regulate the rental with legislation that concerns dwellings for tourism use such as registration requirements, rent to be charged, and the type of property that can be used for short-term rental. These laws may vary for residents and those living out of the community who own property in the community.
Properties located in Costa del Sol are subject to the laws of the Andalusian regional government (Junta de Andalucía) and property owners are required to provide a declaration of responsibility and register their properties on Andalucia’s website.
The National tax that affects short-term rental owners in Spain is IVA (“Impuesto sobre el Valor Añadido), you are not generally liable for IVA (this is the equivalent of VAT or sales tax) unless you offer services and charge guests for them. Examples of these services include cleaning and laundry. The tax rates vary depending on your residence status, as residents in Spain IVA rental tax rates range from 19% to 47%. A flat rate of 19% applies to EEA non-residents in Spain while non-EEA citizen, that is not resident in Spain is liable for a flat rate of 24%.
You are required to apply the tax rate to the services rendered and the commission charged by booking platforms, e.g. Airbnb, for letting your property. It is important to know that even if you don’t pay IVA, you are required to report your rental income alongside other income in your income tax returns. If you list your property on online platforms such as Airbnb, they are required to collect and report your income information on certain platform users who earn income on the Airbnb platform in compliance with DAC7 - EU Data Sharing.
Deductible expenses from your holiday rental IVA include expenses for the refurbishment of the holiday let property, costs associated with the purchase of the property such as legal fees, non-national taxes, such as IBI, cost of maintenance and repair, community fees, insurance cost, utility fees, marketing costs, etc. Although these deductions only apply to Spanish residents or EEA nationals. Non-EEA citizens are required to pay tax on the full amount.
NOTE: The maximum deductible expenses cannot be higher than your total rental income for the year. However, if your expenses are higher, you may deduct the excess amount over the next four years and the recipient of a transaction subject to IVA must be available in order to make the deduction.
There is no national permit, license, or registration for short-term rental owners in Spain, except for short-term rental owners that offer services. You will be required to register for the IVA permit and file your returns quarterly or monthly. IVA returns must be filed in the first twenty calendar days of the month following the tax period, that is, from the 1st to 20th of April, from the 1st to 20th of July, from the 1st to 20th of October, and from the 1st to 30th of January or on the last day of the preceding month for monthly returns.
You may also be required to apply for various permits with your local authority and register your property in your local jurisdiction.
Therefore, it is essential to check with your local authorities for the necessary registrations. You can also check your sub-national jurisdiction page on this website to access the latest information on the laws and regulations that applies to your short-term rental property.
There is no national short-term rental association in Spain but you might consider getting information related to Tourism from The Confederation of National Associations of Hotels, Restaurants, Cafés, and Similar Establishments in the European Union and European Economic Area.
For further information, please contact;
Address: Real Casa de la Aduana 5, Calle de Alcalá Madrid
Telephone: 91 877 60 00
Lodge compliance is not a licensed tax or financial advisor. Therefore nothing in the above article should be construed as tax, legal, or financial advice. Contact your local tax office for information regarding your personal circumstance.