Tax Rates in Spain 2015

The tax legislation in Spain 2015 has been debated for a while. Originally proposed in June 2014 it has now been passed and will come into force from the income year 2015. The new law brings with it implications for both residents and non-residents.

In most cases the reduction in tax rates will be welcomed. However, although the tax rates are being reduced, the thresholds are also being changed. It might be that some people find that they are still paying the same or more as they’ve moved into a higher tax category.

On a similar note, although capital gains tax in Spain is being reduced, the inflation factor is being removed, affecting the amount that some people will have to pay. This part of the legislation has been particularly controversial and many people will be disappointed that this coefficient wasn’t allowed to remain.

Residents

The good news for residents is that there should be a slight reduction in the Spanish income tax to pay. The current tax scale with 7 bands will be reduced to 5:

  • the lowest rate will decrease from 24.75% to 20% 
  • the highest rate from 52% to 47%

Although this will apply to income during 2015, it will not be noticed until the following year (2016) when residents make their tax declaration in June.  

Capital gains tax

The tax rate on capital gains in Spain is set to change. In 2014 the tax rate was:

  • 21% on the first 6,000€
  • 25% between 6,000-24,000€
  • 27% on the rest

From 2015 the rates will be:

  • 20% on the first 6,000€
  • 22% between 6,000-50,000€
  • 24% on the rest

This is particularly important information for sellers of properties as a resident.

Rentals

If you rent out a property in Spain or another country and you are a resident here then the allowance of 60% that you were given previously has been reduced to 50%. This means that 50% of your rental income will now be taxable instead of 40%.

Non-residents

For non-residents, the 2014 capital gains tax flat rate of 21% will be reduced to 20% in 2015 and 19% in 2016.

The general tax rate went down in 2015 from 24.75% to 20% for non-residents from EU countries or countries in the Euro monetary zone with a signed agreement with Spain. The rate for other countries is 24%.

NOTE

This information is current as of the date of its publication and does not necessarily reflect the present state of the law or relevant regulation.