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Wealth Tax

Wealth Tax

Wealth tax in Spain (Impuesto Extraordinario sobre el Patrimonio) was scrapped in 2008 by Zapatero´s government. However, in September 2011 it was reintroduced, this was the last legislative measure taken by the socialist government before the election on the 20th November 2011. It was hoped that the tax would help to reduce the government deficit. The Spanish resident and non resident property owner is liable for a tax on capital assets called "patrimonio". However in 2022 Andalucia followed the region of Madrid in decreeing a full allowance against this tax for Andalucia residents.

In Novemebr 2022 it became clear that the national government would abolish wealth tax for Spanish residents whilst not only retaining it for non residents on property assets in Spain but also expand the scope of wealth tax to include property assets owned by corporations.

In November 2022 a new tax was made public by the national governent called Tax on Large Fortunes (Grandes Fortunas). The Large Fortune Tax is applicabe to worldwide assets on Spanish residents and property assests in Spain belonging to Non Residents. This tax has an exemption of first 700.000€ and tax is not payable until taxanle assets reach 3m €. The tax is likely to be published officially by 31st December 2022 and if so become payable in the tax declarations mane in 2023 for the 2022 fiscal year.

A Spanish resident has an exemption of 108.182 euro which is raised to 300.000 euros when the asset is the principal residence. This means that a husband and wife is exempt from 600.000 euros if both their names are on the title deed. A Spanish resident must declare all his worldwide assets including property, stocks, cars, yachts, jewels, works of art. etc. The basis of the valuation is real market value. The tax rate will vary between 0.2 and 2.5%, depending on the contributory base after allowances.

A non-resident need only declare their property and assets in Spain.

The tax is declared and paid annually at the same time as the income tax (IRPF) but on a separate form - Mod 714.

Wealth tax in Andalucia

The Andalusian Government  announced on 19th September 2022 the end of the Wealth Tax in Andalucia.  Government approved a 100% allowance for the Wealth tax payable, applicable to all Residents in Andalucia as well as to Non Residents who have assets located in this region. The measure will be effective as of fiscal year 2022.  Andalucia follows the same tax policy as Madrid in an attempt to be  one of the most atractive locations in Spain to live in terms of taxes.

Wealth Tax rates

Taxable Base

Tax

Rate Band

Marginal Rate %

0

0

167.129

0.20

167.129

334

167.123

0.30

334.253

836

334.247

0.50

716.581

2.507

668.500

0.90

1.337.000

8.523

1.337.000

1.30

2.673.999

25.904

2.673.999

1.70

5.347.998

71.362

5.347.998

2.10

10.695.996

183.670

-

2.50

Tax on Large Fortunes (Grandes Fortunas)

In November 2022 a new tax was made public by the national governent called Tax on Large Fortunes (Grandes Fortunas). The Large Fortune Tax is applicabe to worldwide assets on Spanish residents and property assests in Spain belonging to Non Residents. This tax has an exemption of first 700.000€ and tax is not payable until taxanle assets reach 3m €. The tax is likely to be published officially by 31st December 2022 and if so become payable in the tax declarations mane in 2023 for the 2022 fiscal year.

Tax on Large Fortunes (Grandes Fortunas) rates

Taxable Base

Tax

Rate Band

Marginal Rate %

0

0

0

3,000,000

3,000,000

0

2,347,998

1.7 %

5,347,998

39,915

537,998

2.1 %

10,695,996

152,223

onwards

3.5%

 

Property tags
Living in Andalucia