In Spain, property rentals are subject to VAT. However, there are some exceptions, including the rental of residential property without hotel services. Here you can find more information on Spanish VAT when rental answered.
Is VAT due on property rentals?
Yes, the general rule is that on top of the rent, 21% you have to charge VAT.
Is VAT due on residential property rentals?
There is an exemption for the rental of residential property, including associated parking spaces or garages , storage rooms and the contents. So you do not have to charge VAT when merely letting residential property, with or without contents.
I sublet my property to an estate agency. This estate agency sublets to third parties. Do I have to charge VAT?
Yes. You should charge 21% VAT.
I do holiday rentals. Is VAT applicable?
If you do not offer hotel services in holiday rentals, you should not charge VAT. Once you offer a hotel service, you will have to charge 10% VAT to your tenants. Learn more about rental income tax and VAT (including hotel services) here.
I rent out a residential property used as an office. Should I charge VAT?
Yes. The rate is 21% VAT.
I am renting out a land. Is there Spanish VAT?
You do not have to charge VAT unless the tenant uses the land for a commercial activity. Consider, for example, the operation of a car park.
Can I deduct VAT paid?
Yes. If you rent out with VAT, you are also entitled to deduct VAT on costs incurred related to the rental.
Do I need to prepare an invoice?
You only need to draw up an invoice if you rent to a sole trader or legal entity.
