Spain has many of the usual taxes – sales tax, income tax, capital gains tax, etc. But the wealth tax takes many foreign residents by surprise. It is a national tax, but is set and regulated by Spain’s different regional authorities. For non-residents that own property in Spain, only the Spanish property is taxes. Residents are taxes on their against their total assets, including real estates, business activities, savings, insurance policies, luxury personal property, royalties and interest in intellectual property. There are several allowances that can make this tax not quite a terrifying amount: pensions, normal household items, personally owned and run businesses and author’s rights are exempt, if relating to the individual’s main activity and source of income.
The wealth tax was reintroduced in 2011 during the financial crisis and was meant to only be temporary. Due to this uncommon tax, Spain has become less enticing to foreigners than other countries that provide more incentives and tax exemptions.
See Adam Neale, All You Need to Know About Spain’s “Patrimonio” Wealth Tax, Olive Press, May 26, 2018.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.) for bringing this article to my attention.
