Moving to the Canary Islands: Expat Guide to Living, Visas and Tax in 2026

The Canary Islands sit off the northwest coast of Africa but are fully part of Spain — and therefore the EU. They enjoy a subtropical climate that keeps temperatures between 18°C and 26°C throughout the year, without the extreme summer heat that makes mainland Spain uncomfortable from June to September. For British and American expats in particular, that stable warmth is one of the region's most compelling selling points.

Add a lower cost of living than the Spanish mainland, a unique tax structure that keeps consumer prices down, excellent flight connections to Europe and beyond, and a large established expat community across multiple islands, and the case for the Canary Islands builds quickly. This guide covers the practical questions you need answered before you commit.

Why Move to the Canary Islands?

The short answer is climate plus affordability plus convenience. The longer answer involves understanding what makes the Canaries genuinely different from other parts of Spain.

The climate is the standout factor. The islands' position — far south in latitude but moderated by the Atlantic and trade winds — produces something closer to perpetual spring than to the baking summers of Andalusia. You will almost never need heating, and air conditioning is rarely essential. For older expats in particular, this stable warm climate has real health and quality-of-life benefits.

The tax advantage is equally significant and often underappreciated. The Canary Islands operate under a separate fiscal regime from mainland Spain, with their own indirect tax called IGIC (Impuesto General Indirecto Canario) at a standard rate of just 7%, compared to the 21% IVA applied on the mainland. This is not a small difference: it means that almost every consumer purchase — groceries, clothing, vehicles, household goods, restaurant meals — costs meaningfully less than it would in Madrid or Barcelona.

The region also has a favourable corporate tax regime. The Zona Especial Canaria (ZEC) offers reduced corporate tax rates for qualifying businesses established on the islands, which attracts entrepreneurs and small business owners as well as employees.

The IGIC Advantage Explained

IGIC replaces mainland Spain's IVA (VAT) entirely in the Canary Islands. The comparison matters in practical terms:

• Mainland Spain standard IVA: 21%
• Canary Islands standard IGIC: 7%
• Reduced IGIC rate (food, basic goods): 3%
• Zero IGIC rate (certain food staples, medicines): 0%

On a monthly grocery shop of €400, the difference between 21% VAT and 7% IGIC is approximately €56 — around €670 per year on groceries alone. Across all consumer spending, the saving is substantial. Cars, appliances, electronics, and services all benefit from the same lower rate.

For businesses and entrepreneurs, the IGIC structure and additional ZEC benefits make the Canaries one of the most tax-efficient places in Europe to establish an operation. This is increasingly drawing digital businesses and remote-working entrepreneurs alongside the traditional retiree expat population.

Which Island Is Right for You?

The Canary Islands archipelago contains seven main islands, each with a distinct character. Choosing the right one matters more than most prospective movers realise.

Tenerife — best for families and those wanting infrastructure

Tenerife is the largest island and the one with the most developed international expat infrastructure. The south (Los Cristianos, Costa Adeje, Playa de las Américas) has a very large British retiree and family community with English-speaking doctors, dentists, solicitors, churches, and social clubs. The north (Puerto de la Cruz, La Laguna, La Orotava) is cooler, greener, and attracts a more mixed international crowd who want a genuine Canarian experience rather than an expat bubble. The capital, Santa Cruz de Tenerife, is a functioning Spanish city with excellent hospitals, universities, and all the services of a modern urban centre.

Gran Canaria — best for urban living and professionals

Las Palmas de Gran Canaria is the joint capital of the Canary Islands (shared with Santa Cruz de Tenerife) and a genuinely cosmopolitan city of around 380,000 people. It has a large and diverse expat community, strong business connections, and a beach — Las Canteras — running through the city itself, which is a rare urban luxury. The south of the island (Maspalomas, Playa del Inglés) is a major resort area. Gran Canaria suits those who want city amenities, a buzzing cultural scene, and relatively easy integration into Spanish life.

Lanzarote — best for retirees and nature lovers

Lanzarote is the most architecturally distinctive of the main islands, shaped by volcanic landscapes and the design philosophy of the late local artist César Manrique, who created strict aesthetic guidelines that have kept the island free of high-rise development. It is quieter and smaller than Tenerife or Gran Canaria, with a pace of life that suits retirees and those who actively want to step away from urban intensity. A UNESCO Biosphere Reserve, it has excellent hiking, cycling, and watersports. The cost of living is lower than the larger islands.

Fuerteventura — best for outdoor enthusiasts

Fuerteventura has the most consistent winds in the archipelago, making it a world-class destination for kitesurfing, windsurfing, and surfing. Its long beaches — some of the best in Europe — attract a younger crowd and an increasingly active remote-working community drawn by comparatively low rental prices. It has a smaller expat infrastructure than Tenerife or Gran Canaria, but is growing steadily.

La Palma, La Gomera, El Hierro

These smaller, more remote islands offer extraordinary natural beauty and genuine quiet. They suit expats who actively want to escape — experienced Spain residents rather than first-time movers. Infrastructure is more limited, English less widely spoken, and the community smaller. For the right person, they are exceptional places to live.

Cost of Living in the Canary Islands

Here is a realistic monthly cost comparison for a single person living comfortably:

• Rent, one-bedroom apartment in city centre (Tenerife/Gran Canaria): €750–€1,000
• Rent, one-bedroom outside city centre or in smaller towns: €550–€800
• Monthly groceries: €200–€300
• Utilities (electricity, water, internet): €80–€120
• Private health insurance (age 50–65): €80–€150 per month
• Public transport monthly pass: €40–€55
• Eating out and leisure: €250–€450
• Total comfortable monthly budget: approximately €1,500–€2,200

This is considerably cheaper than Barcelona or Madrid, and dramatically cheaper than London, Dublin, or Sydney on equivalent income. For British retirees on pension income, this cost structure is particularly attractive.

Healthcare in the Canary Islands

The Canary Islands have both public and private healthcare systems. The public system (Sistema Canario de Salud) provides good general care, with major hospitals on Tenerife and Gran Canaria providing specialist services. Waiting times in the public system can be longer for non-urgent specialist appointments.

Non-EU residents moving to the Canary Islands on a Non-Lucrative Visa or Digital Nomad Visa are required to hold private health insurance as part of their visa conditions. This applies from day one of residency and must remain in force throughout the visa period. Good-quality private policies are available from Spanish insurers including Sanitas, Adeslas, and Asisa at reasonable rates — expect to pay €80–€200 per month depending on age and coverage level.

Private clinics and hospitals on the main islands frequently have English-speaking staff, particularly in areas with large expat populations. For serious medical needs, Tenerife's Hospital Universitario de Canarias and Gran Canaria's Hospital Universitario Gran Canaria Dr. Negrín both provide a high standard of care.

Visas and Residency

As part of Spain and the EU, the Canary Islands apply the same visa rules as the rest of Spain. Non-EU citizens — including British nationals, Americans, Canadians, Australians, and South Africans — require a Spanish residency visa to live here legally beyond the standard 90-day tourist allowance.

The three main routes are:

• Non-Lucrative Visa (NLV): For retirees and those with sufficient passive income. Requires approximately €2,400 per month for a single applicant, private health insurance, and a clean criminal record. Initial permit valid for one year, renewable for two-year periods.
• Digital Nomad Visa (DNV): For remote workers and freelancers working for non-Spanish clients. Requires income of at least 200% of the Spanish minimum wage. Particularly popular in the Canaries given the lifestyle and lower costs.
• Student Visa: For those enrolling in Spanish universities, language schools, or other accredited educational programmes.

All three applications are document-intensive. The Canary Islands are part of Spain, so the applications go through the same Spanish consulate system in your home country. Working with experienced immigration specialists significantly reduces the risk of errors that cause delays.