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Date Published: 02/12/2025

In question: Rental-expense deductions for non-EU property owners in Spain

by IberianTax

For the 2025 tax year, non-resident property owners in Spain must file their Rental Income Tax return (Modelo 210) between 1 January and 20 January 2026. This applies to both short-term and long-term rentals. Non-resident property owners are also required to submit their 2024 Imputed Income tax return by 31 December 2025.

What traditionally used to mean endless paperwork, confusing jargon and costly gestorías, can now be completed in minutes from the comfort of your own home.

Built for non-resident property owners, IberianTax’s user-friendly platform makes the Modelo 210 process simple, with clear guidance, multilingual expert support and transparent pricing you can trust.

Potential changes for non-EU property owners

Having said this, property owners in Spain who live outside the European Union (EU) or European Economic Area (EEA) could be seeing major changes to their taxation laws:

Non-EU or EEA residents with property in Spain have long faced disputable discriminatory tax treatment: when renting out, they are faced with taxes at a flat 24% rate on gross income, with no ability to deduct ordinary rental expenses like repairs, insurance or local taxes.
In contrast, EU/EEA residents renting out their property in Spain are taxed at 19% and can deduct a number of expenses associated with their rental activity.

However, recently the National Court stated that denying non-EU non-residents the right to deduct rental expenses is discriminatory and contrary to EU law, specifically the principle of free movement of capital.

What did the court decide?

On July 28, 2025, the National Court delivered decision 3630/2025, in which it recognised that non-resident, non-EU taxpayers should be permitted to deduct expenses directly associated with the rental of their Spanish properties.

If the decision is ultimately upheld, non-EU, non-resident owners could claim deductions such as:

Cleaning, maintenance, and general property upkeep
Utility bills (electricity, water, gas)
Local council taxes (e.g. IBI) and community fees
Repairs
Insurance
Agency and property management fees
Depreciation of the property

These deductions are valid only if the expenses are directly related to the rental income and can be justified as reasonable and necessary for the property’s rental activity.

What’s the current status?

As of October 2025, The State Attorney’s Office has appealed to Spain’s Supreme Court. Which means that, for now, the ruling is not final.

Meanwhile, until a definitive verdict is reached:

Spanish tax form Modelo 210 (the declaration for non-resident rental income) does not yet permit deductions for non-EU property owners
The Spanish Tax Agency continues to apply its existing criteria, taxing non-EU non-resident rental income at 24% on gross revenue

Thus, for now, the new ruling is more of a legal precedent than a change in practice.

What should owners do now?

To prepare in case the Supreme Court upholds the National Court’s decision, non-EU property owners may consider taking these steps:

Save relevant documentation.
Keep receipts, bills, invoices, and any supporting records of rental-related expenses for the past 4 years (and for future years). These will be critical if a deduction claim is allowed.

Pro Tip: IberianTax’s free Expenses Tracker helps you log and manage expenses, automatically syncing them with your Modelo 210 returns. Register for free today and start using this smart tool.
Consider filing a precautionary rectification claim.
Declarations from late 2021 or 2022 are nearing expiration (4 years). Filing a rectification request now can allow you to interrupt the limitation period, preserving the right to claim a refund later – if the Supreme Court upholds the right to deduct rental expenses.
Stay informed and follow developments.
The ruling’s final outcome could take months or longer, so keeping up with the latest news and updates is essential. You can do so by following IberianTax’s blog.
Seek professional support.
At IberianTax, we specialise in helping and guiding non-resident property owners in Spain. We can help you with:

Evaluating your particular situation
Preparing and submitting a precautionary rectification request
Managing the entire administrative process
Filing your Modelo 210 forms securely, quickly, and fully online
Keeping you informed with the latest news and updates via our blog

Possible impacts if the ruling holds

If Spain’s Supreme Court upholds the National Court’s recent decision, the change could be game-changing for non-resident property owners.

It would mean equal tax treatment for all landlords, whether you live inside or outside the EU/EEA. Rental income would be taxed on net profits instead of gross revenue, allowing you to pay tax only on what you actually earn. Even better, refunds could be claimed for up to four years back, provided your documentation is in order.

This would make owning and renting out property in Spain far more attractive for non-EU investors, removing the unfair disadvantage based purely on nationality.

At IberianTax, we believe this marks meaningful progress toward fairer tax treatment for international property owners. Stay ahead of the changes and join the thousands who rely on IberianTax for their Modelo 210 each year.

Create your free account with IberianTax today and enjoy a 5% discount on your first filing. Simply use the code WELCOME5 at the checkout.

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If you own property in Spain but don’t live there, you must pay tax – whether you use it as a holiday home, rent it out or sell it.

IberianTax helps non-resident property owners file their Modelo 210 tax forms quickly and securely. Our easy-to-use online platform simplifies the process of filing the Modelo 210 tax form, ensuring full compliance with Spanish tax laws. With step-by-step support and affordable pricing starting at just €34.95, filing your taxes has never been easier or stress-free.

Join thousands of non-resident homeowners who have chosen IberianTax as their trusted tax partner in Spain. Visit our website and sign up for your free account now.

IberianTax, non-resident tax returns (Modelo 210) for property owners in Spain

What is the Modelo 210 tax form?

The Modelo 210 is Spain’s tax form for non-residents who own property in Spain. It is used to declare taxes related to your property.

There are different types, depending on the tax:

Imputed Income (Modelo 210): Owning a property for personal use (i.e.: holiday home).
Rental Income (Modelo 210): For income earned from renting out your property.
Capital Gains (Modelo 210): For tax due when you sell your property.

How to file your non-resident Modelo 210 tax with IberianTax in 3 steps

Create an Account: Sign up for free to start. You can get a free tax estimate by using our tax calculator and only pay when you submit your Modelo 210.
Enter Your Details: Complete the simple IberianTax questionnaire with your property and personal information. Step-by-step guidance and examples are included.
Submit Your Tax: Choose your payment method, and IberianTax will file your Spanish non-resident tax return online for you. Simple!

Why use IberianTax to file your Modelo 210?

Fast & Easy: File your Modelo 210 online in minutes.
Simple: Step-by-step questionnaire – no tax knowledge needed.
Affordable: Services from €34.95 VAT inc., far less than typical €150+VAT.
Flexible: File anytime, anywhere, with multiple payment options.
Accurate: Built by tax experts with automatic checks.
Secure: Data encryption and safe online payments.
Certified: Approved by the Spanish tax authorities.
Multilingual: English, French and German support available.

Whether you need to file taxes for personal use, rental income, or capital gains, IberianTax offers a comprehensive, reliable, and cost-effective solution for non-resident property owners in Spain.

Get started now on the IberianTax website and enjoy a 10% discount or, if you have any further questions, the team will be happy to answer them. Just use the contact box above, or fill in the contact form on their website.

Alternatively, you can send an email to contact@iberiantax.com and they will get back to you as soon as possible.