Buy-to-Let in Spain: Tourist Licences, Tax and What Non-Residents Need to Know

Spain has no restrictions on property ownership by foreigners, which makes it an accessible market for investors from the UK, US, Canada, Australia and South Africa. The country's consistent tourism numbers, strong coastal demand and relatively affordable entry prices in many regions make buy-to-let an attractive proposition. However, the regulatory landscape has become considerably more complex over the past decade, and what worked in 2015 does not necessarily work today. Tourist licence requirements, community rules on Airbnb, and Spain's non-resident income tax system all require careful planning before you commit to a purchase.

One essential point from the outset: purchasing a buy-to-let property in Spain does not grant you the right to live there. Non-EU nationals remain subject to the 90-day Schengen limit regardless of property ownership. If rental income from your Spanish property forms part of a plan to eventually move to Spain, you will need a Spanish residency visa separately. The Non-Lucrative Visa is the most commonly used route for property owners with passive income.

Short-Term vs Long-Term Rentals: Two Different Regimes

The first decision every Spanish buy-to-let investor faces is whether they intend to let their property on a short-term tourist basis or on a longer-term residential basis. The legal and tax treatment differs substantially between the two.

Long-Term Residential Rentals

Renting your property to a tenant on a standard residential lease is governed by Spain's Urban Leases Act (Ley de Arrendamientos Urbanos, or LAU). Long-term leases — typically defined as contracts not intended for tourism purposes — give tenants strong protections, including the right to renew for up to five years (seven if the landlord is a legal entity) and strict limits on the deposit the landlord can charge. Eviction of non-paying tenants through the Spanish courts, while improved in recent years, remains a slower process than many foreign investors expect. If you are relying on rental income for cash flow, the long-term residential route offers stability but less flexibility.

Short-Term Tourist Rentals

Renting a property to tourists for short stays — the Airbnb and Vrbo model — is classified separately in Spanish law and requires a tourist rental licence. The rules here are set at the autonomous community (regional) level, and they vary significantly from one region to another. This regional variation is one of the most important things to understand before you choose where to buy.

Tourist Licences: The Rules by Region

Every Spanish autonomous community has its own tourist accommodation law. To rent legally on platforms such as Airbnb, Booking.com or Vrbo, you must register with the relevant regional authority and obtain a tourist rental registration number, which is then displayed on all listings. Operating without this registration risks fines that vary by region but commonly run into thousands of euros per violation.

The general process for obtaining a tourist licence typically involves:

• Ensuring the property has a valid habitation licence (cédula de habitabilidad).
• Submitting a declaration of responsible opening (declaración responsable) to the regional tourism registry.
• Meeting minimum standards set by the regional authority for furnishing, safety and facilities.
• Displaying your registration number on all advertising and booking platforms.

Demand is very high in popular areas, and several regions — including the Balearic Islands, Barcelona city and certain municipalities in the Canary Islands — have actively restricted new tourist rental licences to manage housing supply. In some locations, new licences have been suspended entirely for apartment buildings in specific zones. If your investment plan depends on operating a short-term rental, you must verify the current licensing availability in your target area before you buy, not after.

Community of Owners Rules and the Airbnb Vote

Even if the regional government permits tourist rentals in your area and you can obtain a licence, your apartment community may have its own restrictions. Since 2019, Spain's Horizontal Property Law (Ley de Propiedad Horizontal) has allowed a community of owners to restrict or outright prohibit short-term tourist rentals in the building by a vote of three-fifths of owners representing three-fifths of participation quotas. Communities can also impose additional financial contributions on owners who operate tourist rentals, such as a higher share of common expenses.

If a community passed a resolution restricting tourist rentals before you completed your purchase, that restriction binds you as the new owner. This is why reviewing the community statutes and the minutes of recent annual meetings — before you sign a purchase contract — is an essential step for any buy-to-let investor. Your property lawyer should check these documents as part of their pre-purchase due diligence.

Non-Resident Income Tax on Spanish Rental Income

If you are not a Spanish tax resident, your rental income from a Spanish property is taxed under IRNR — the Impuesto sobre la Renta de No Residentes. The way this works depends critically on where you are resident for tax purposes.

EU and EEA Residents

If you are resident for tax purposes in another EU or EEA country, you can deduct allowable expenses from your rental income before calculating tax. Allowable deductions include mortgage interest, community fees, insurance, property management fees, maintenance costs and a proportion of utilities. Net rental income is then taxed at 19%. This mirrors the treatment that Spanish residents receive and is a significantly more favourable regime than that available to non-EU residents.

Non-EU/EEA Residents (Including UK Nationals Since Brexit)

UK nationals are now classed as non-EU third-country nationals for Spanish tax purposes. This means they are taxed on gross rental income — with no expense deductions — at a flat rate of 24%. The effective tax burden on a UK landlord is therefore considerably higher than on an equivalent EU-resident investor earning the same gross rental income. This is a significant financial planning consideration for UK buyers and should be factored into any yield calculations.

IRNR returns are filed quarterly (in January, April, July and October) using Form 210. Non-residents who own Spanish property but do not rent it out still owe a deemed income tax based on the cadastral value of the property, also declared on Form 210.

Calculating Your Net Yield

A realistic buy-to-let yield calculation for a Spanish property needs to account for the following costs in addition to the purchase price:

• Annual council tax (IBI): varies by municipality but typically €300–€1,500 per year.
• Monthly community fees (cuotas): €100–€500 per month depending on the building and its facilities.
• Property management: 15–25% of gross rental income if using a management agency.
• Cleaning and changeover costs between tourist guests.
• Home insurance and contents insurance.
• Maintenance, repairs and occasional refurbishment.
• IRNR tax filings (quarterly) and associated accountancy costs.
• Tourist platform fees (typically 3% for Airbnb host fees).

As a rough rule of thumb, allow 25–35% of gross rental income for ongoing costs before applying tax. On a property generating €15,000 gross per year in a popular coastal area, net income after costs and tax might be in the range of €7,000–€9,000 for an EU-resident investor, or somewhat less for a UK-based investor paying tax on gross income.

The 90-Day Limit and Your Own Use of the Property

Many buy-to-let investors in Spain also want to use the property themselves for holidays. This is entirely possible, and the flexibility to enjoy your property during off-peak periods while letting it out during high season is one of the genuine attractions of Spanish property investment. However, it is important to understand that as a non-EU national, you can only spend 90 days in any 180-day period in the Schengen Area. Your personal use of the property eats into that allowance. If you are planning to spend significant time in Spain — whether or not the property is let — you will need a Spanish residency visa in addition to your property.

Rental Income Towards Visa Eligibility

For investors who want to eventually move to Spain, it is worth noting that rental income from a Spanish property can count as passive income for the purposes of a Non-Lucrative Visa application, provided it meets the income threshold (currently around €2,400 per month for a single applicant) and can be clearly documented. Some landlords combine rental income from their Spanish property with pension income or other investment returns to meet the threshold. Speak to a specialist before designing your visa income strategy around rental income alone, as the Spanish consulate will scrutinise the source and consistency of the income.