Income Tax (IRPF) for Foreign Residents in Spain

Published on 14 April 2025

As April rolls around, it’s time to start preparing your income tax return in Spain. The official filing period runs from 2 April to 30 June, so if you’re a tax resident in Spain, now’s the time to gather all your necessary documents. Understanding the Spanish tax system is key to staying compliant and avoiding any hiccups with the Spanish Tax Agency (Hacienda). The income tax return (IRPF) applies to all tax residents in Spain and covers income earned during the previous calendar year.

Tax Residency in Spain: Are you considered a Tax Resident?

Before we dive into the nitty-gritty of filing your tax return in Spain, let’s tackle the big question: Are you a tax resident in Spain?

Only individuals who are considered tax residents need to file an Income Tax Return (IRPF). You’re a Spanish tax resident if you meet any of the following conditions:

You’ve lived in Spain for more than 183 days in a calendar year.
Your main economic interests (business, property, employment) are based in Spain.
Your immediate family (spouse and/or dependent children) live in Spain.

If any of these sound like you, congratulations—you’re a tax resident in Spain and will need to submit your Spanish tax return accordingly.

Understanding Income Tax in Spain for expats and foreign residents

Foreign residents file the same income tax return as Spanish nationals, known as Form 100. The tax return is submitted between April and June, covering income earned in the previous calendar year. For example, in April 2025, you’ll declare all income earned between 1 January and 31 December 2024.

To find out whether you are obliged to file a tax return, you must take into account the source of each income (income from work, income from movable or real estate capital, capital gains, economic activities) and the amount of each income you have obtained in the financial year for which you are filing the return.

Basically, you’ll need to file a tax return in Spain if you meet any of the following criteria:

You earned more than €22,000 gross per year from a single employer.
You earned more than €15,000 from one employer and over €2,500 from additional sources.
You are self-employed, provided you earned more than €1,000 per year.
You received over €1,600 in capital gains.
You received unemployment benefits or the Minimum Vital Income (IMV).
You earned income from cryptocurrencies or digital platforms, which are now subject to increased scrutiny

Some people are not obliged to file a tax return, even if they exceed certain limits, depending on the applicable deductions or their personal situation. For example, workers whose income does not reach the above-mentioned minimums and people with income exclusively from movable income of less than €1,600. It is always best to consult a tax advisor for guidance or to make an appointment with the tax authorities to discuss your particular case.

How to file your Tax Return as a foreign resident

Filing your tax return in Spain doesn’t have to be stressful! Here are your two main options:

Do it yourself via the Spanish Tax Agency’s (Hacienda) website – If your tax situation is straightforward, you can follow the official guidelines and submit your return online. It’s easier than it sounds!
Use a tax advisor – If you’ve got multiple income sources, complex finances, or just feel unsure, hiring a professional tax advisor is a great idea. They’ll handle the heavy lifting for you.

Special Expat Tax Regime in Spain: The Beckham Law

If you’re a foreign professional relocating to Spain, you might be eligible for the Beckham Law (officially known as the Special Expat Tax Regime). This little gem offers some serious tax benefits for expats in Spain!

Under this scheme, eligible individuals pay a flat 24% income tax rate instead of the progressive IRPF, which can go up to 47%. This can result in significant tax savings! To qualify, you’ll need to meet certain criteria, which you can check here.

And don’t forget about double taxation agreements! These ensure you’re not taxed twice on the same income—once in Spain and again in your home country. You can find the full list of Spain’s double taxation treaties here.

Filing taxes in Spain as an expat can feel overwhelming, but with the right help, you’ll breeze through it. When in doubt, a tax professional is your best friend.

Key Tax updates for 2025

Each year, tax regulations evolve, and 2025 brings several key changes that may impact your tax return in Spain. Here are some of the most relevant updates:

Increase in Savings Tax Rates: From 1 January 2025, the highest savings tax rate will rise from 14% to 15%, and for certain non-residents, from 28% to 30%.
Energy Efficiency Tax Deductions Extended: The tax deduction for home energy efficiency improvements has been extended until 31 December 2025.
Electric Vehicle and Charging Station Deductions: The tax incentive for purchasing electric vehicles and installing charging points is extended until the end of 2025.
Flat-Rate Tax for Artists: A new 30% reduction applies to earnings exceeding 130% of the average income from the last three years.
Updated Exemptions: New exemptions include certain civil liability compensations, severance payments agreed in mediation, and child maintenance payments set in legally recognised agreements.

Taxes and Insurance: What expats should consider

Beyond just paying your taxes, this is also a great time to optimise your financial planning, including your insurance coverage. Here’s how taxes and insurance can work together to your benefit:

Tax Deductions on Certain Insurance Policies – Did you know that some insurance premiums, like life insurance tied to a mortgage, might be tax-deductible? It all depends on the specifics, so it’s worth checking!
Insurance and Residency Status – If you own a home or have significant assets in Spain, having the right insurance coverage (home, car, life) is a must. It’s not just about protection—it’s about financial efficiency too.
Protection Against Unexpected Events – Tax season is a great reminder to make sure you and your family are fully protected. Life and accident insurance can give you peace of mind, knowing your loved ones and assets are secure.

Feeling a bit overwhelmed? Don’t worry—you’re not alone! At Generali Expatriates, we’re here to make life easier for expats in Spain, our network of expert expat agents and brokers is ready to assist. They speak your language and are dedicated to helping you find the best solutions for your needs.

Looking for the right insurance coverage? Visit our Ask for a Quote page or Find Your Local Agent for personalised advice and the best options for your needs.