The Wealth Tax (IP) is a tax that applies to both tax residents in Spain and non-residents who own assets in the country. For non-residents, this tax applies exclusively to assets and rights located in Spain, meaning that foreign assets are not included in the taxable base.
If you are a foreigner with assets in Spain or live abroad, it is essential to understand:
✔️ Who is required to pay the Wealth Tax.
✔️ How it is calculated and which assets must be declared.
✔️ What exemptions and reductions exist for non-residents.
✔️ How to file the tax return and avoid penalties.
📌 At Lextax, we specialize in international taxation and help you comply with your tax obligations efficiently.
What Is the Wealth Tax in Spain?
The Wealth Tax is a direct and personal tax levied on the net value of a person’s assets and rights as of December 31st each year. It is calculated based on the value of assets located in Spain, deducting debts and financial liabilities.
📌 Important: Not all wealth is subject to this tax, as there are minimum exemptions and differences in regulations depending on the autonomous community.
💡 If you are unsure how the tax applies to your case, consult Lextax’s international tax experts.
Who Is Required to Pay the Wealth Tax in Spain?
The Wealth Tax for Non-Residents applies to foreigners who own assets in Spain, but there are key differences compared to residents:
🔹 Residents in Spain: Taxed on their worldwide assets (assets in Spain and abroad).
🔹 Non-Residents: Taxed only on assets and rights located in Spain.
📌 Example:
✔️ If you are a tax resident in Spain, you must declare all your assets, including those in other countries.
✔️ If you are a non-resident, you only need to declare the value of assets located in Spain (e.g., real estate, bank accounts in Spanish banks, shares in Spanish companies, etc.).
💡 Consult Lextax to ensure you are taxed correctly without overpaying.
Wealth Tax Features for Non-Residents
1. Wich Assets Are Included in the Tax Calculation?
Non-residents must declare the following assets located in Spain:
✔️ Real estate: Houses, apartments, commercial premises, land.
✔️ Bank accounts in Spain.
✔️ Shares in Spanish companies.
✔️ Securities and insurance policies with Spanish entities.
2. Minimum Exemption
The general exemption threshold is €700,000, although autonomous communities may set different limits.
📌 Example:
If a non-resident owns a property in Spain valued at €800,000, they will only be taxed on €100,000 (€800,000 minus the €700,000 exemption).
3. Tax Rates
The tax is progressive, ranging from 0.2% to 3.5%, depending on the total net wealth value.
4. Filing Obligation
📌 If the net value of assets in Spain exceeds the exemption limit, the taxpayer must file the Wealth Tax return.
5. Submission of Form 714
📌 Non-residents must file Form 714 with the Spanish Tax Agency, electronically, between April and June of the following year.
💡 At Lextax, we handle the entire filing process so you can comply with regulations worry-free.
Key Requirements for Non-Residents
To ensure correct taxation, non-residents must comply with certain fiscal obligations:
📌 1. Determining Tax Residency
It is essential to verify your tax residency in another country to avoid double taxation issues.
📌 2. Appointment of a Tax Representative
If a non-resident lives outside the EU or EEA, they are required to appoint a tax representative in Spain.
📌 3. Asset Valuation
The tax is calculated based on the highest value among:
✔️ Cadastral value.
✔️ Purchase value.
✔️ Value verified by the Tax Administration.
📌 Example:
If a property has a purchase value of €500,000 and a cadastral value of €400,000, the higher value (€500,000) must be declared.
Frequently Asked Questions About Wealth Tax for Non-Residents
Do I have to pay this tax if I only own one property in Spain?
It depends on its value. If the property exceeds the exemption threshold, the corresponding tax must be paid.
How is a property valued for the Wealth Tax?
The highest value among the following must be declared:
✔️ Cadastral value.
✔️ Purchase value (purchase price).
✔️ Value verified by the Tax Administration.
Can I deduct mortgages or debts when calculating the tax?
Yes, but only if they are linked to assets located in Spain.
Are there any exemptions or reductions for non-residents?
✔️ Madrid grants a 100% exemption, meaning that even if you are required to file, no tax is payable.
✔️ Other autonomous communities offer specific reductions.
💡 Consult Lextax to check if you qualify for any deductions.
Conclusion: How Can Lextax Help You Optimize Your Taxation?
The Wealth Tax in Spain can represent a significant tax burden for non-residents, but there are legal strategies to reduce or even eliminate it.
📌 How does Lextax assist you?
✔️ Personalized analysis of your wealth situation in Spain.
✔️ Tax optimization to minimize your tax burden.
✔️ Complete management of Form 714 with the Spanish Tax Agency.
✔️ Fiscal representation in Spain for non-residents.
✔️ Advice on applicable exemptions and reductions.
📞 Need advice on Wealth Tax for Non-Residents? Contact Lextax for a detailed analysis of your case and ensure you don’t overpay taxes.
🔗 More information on international taxation:
✅ Spain-U.S. Double Taxation Treaty
✅ Spain-UK Double Taxation Treaty
💡 At Lextax, your taxation is in expert hands. ✅