Taxes for Foreign Property Owners in Galicia: Complete Tax Guide 2025

Overview of Taxes for Foreign Property Owners in Galicia

As a foreign property owner in Galicia, you are subject to several Spanish tax obligations. The good news is that Spain has double taxation treaties with over 90 countries, preventing you from paying taxes twice on the same income. Below, we break down each applicable tax with concrete examples for properties in A Coruña, Vigo, Santiago de Compostela, and the Costa da Morte.

IRNR: Non-Resident Income Tax

The IRNR is the most important tax for non-resident foreign owners. It taxes income earned in Spanish territory and applies differently depending on the property's use:

• Vacant or personal use: A deemed income allocation of 1.2% of the cadastral value applies (2% if the cadastral value hasn't been revised in the last 10 years). Tax rate of 19% for EU/EEA citizens and 24% for others.
• Rented property: You are taxed on net rental income (income minus deductible expenses). Rate of 19% for EU/EEA and 24% for third countries.

Example: If your apartment in A Coruña has a cadastral value of €120,000 and you use it personally, you will pay €120,000 × 1.2% × 19% = €273.60/year in IRNR.

Deductible rental expenses include: IBI, insurance, repairs, mortgage interest, community fees, and property depreciation (up to 3% annually of the construction value).

IBI: Property Tax

The IBI is a mandatory local tax paid by all owners, resident or not. It is collected by the municipality where the property is located:

Municipality	IBI Rate	Example (cadastral value €100,000)
A Coruña	0.40 – 0.55%	€400 – €550/year
Vigo	0.38 – 0.52%	€380 – €520/year
Santiago de Compostela	0.35 – 0.48%	€350 – €480/year
Corcubión	0.30 – 0.45%	€300 – €450/year
Fisterra	0.28 – 0.42%	€280 – €420/year

IBI is paid annually, usually between September and November. You can set up direct debit from your Spanish bank account to avoid delays and surcharges.

Municipal Capital Gains Tax (Plusvalía)

The municipal capital gains tax is paid when selling or transferring a property. It taxes the increase in land value during the holding period:

• Taxable base: Calculated on the land value per the cadastre multiplied by a coefficient depending on years of ownership (from 0.14 for 1 year to 0.45 for 20+ years)
• Tax rate in Galicia: Generally between 26% and 30% depending on the municipality
• Bonus: Many Galician municipalities offer 50-95% reductions for primary residence transfers

Since 2021, there is an optional method that calculates the tax on the actual gain (difference between purchase and sale price), which can be more favorable in areas where land has lost value, such as some Costa da Morte municipalities.

Wealth Tax

Galicia applies a wealth tax to non-residents with real estate in the autonomous community. Key points:

• Exempt minimum: €700,000 for residents; no guaranteed exempt minimum for non-residents (depends on the treaty)
• Tariff: Progressive from 0.20% up to 2.50% for wealth exceeding €10 million
• Primary residence exemption: Up to €300,000 for residents; does not apply to non-residents

Important: If your only asset in Spain is a €150,000 home in Cee, you most likely will not exceed the exempt minimum. But if you accumulate multiple properties, planning is essential.

Double Taxation Treaties

Spain has signed double taxation treaties (DTT) with over 90 countries. These treaties determine which country has the right to tax each type of income:

• United Kingdom: Real estate income can be taxed in Spain (maximum 19-24%). The UK grants a tax credit for what is paid in Spain.
• Germany: Spain taxes real estate income. Germany exempts or grants a tax credit.
• France: Similar to Germany. Capital gains on real estate are taxed where the property is located.
• Netherlands: Spain taxes. The Netherlands grants a tax credit or exemption.
• USA: Spain taxes. The US grants a Foreign Tax Credit.

Filing Obligations and Deadlines

1. Form 210 (IRNR): Quarterly filing (April, July, October, January) for rental income. Annual filing (January 1 to June 30 of the following year) for deemed income allocation.
2. IBI: Annual direct debit payment, usually in autumn.
3. Form 211: Withholding on rents paid to non-residents (if you rent to a non-resident).
4. Wealth Tax: Filed between April and June of the following year if wealth exceeds the exempt minimum.

Legal Tax Optimization Strategies

There are perfectly legal strategies to minimize your tax burden in Galicia:

• Establish tax residency in Spain: If you spend more than 183 days per year in Spain, you become a tax resident with an exempt minimum and personal deductions.
• Deduct rental expenses: IBI, insurance, community fees, repairs, mortgage interest, and depreciation (3% annual) reduce your taxable base.
• Choose actual capital gains method: If land has decreased in value, opt for the actual gain calculation.
• Municipal bonuses: Check with your town hall. Many Costa da Morte villages offer 50-95% reductions for property rehabilitation.
• Inheritance planning: Galician regulations offer significant reductions on inheritances between direct family members.

How I Can Help With Your Tax Obligations

Own a property in Galicia and need help with your taxes? As a local professional with extensive experience advising foreign property owners, I can connect you with trusted tax managers and lawyers who will handle all your obligations. Contact me today and make sure you comply without overpaying.