Where taxpayers get caught out
Non-residents often think wealth tax applies only to the very rich. With high property values in Mallorca and Ibiza, a single villa can exceed the exempt amount, and non-residents do not benefit from the main-home exemption that residents enjoy.
How wealth tax works
| Element | Rule |
|---|---|
| Taxpayer | Residents on worldwide wealth; non-residents on Spanish assets |
| Valuation date | 31 December each year |
| Main home | Up to 300,000 euros exempt for residents |
| Exempt amount | General minimum, adjustable by each region |
| Debts | Deductible if they finance the taxed assets |
| Filing | Usually with the income tax campaign, April to June |
The Balearic rules
The Balearic Islands have their own wealth tax scale and exempt amount, which have changed several times in recent years. Non-residents may generally apply the rules of the region where most of their Spanish assets are located. We apply the rules in force for each year. See wealth tax in the Balearic Islands.
The solidarity tax on large fortunes
Introduced in 2022, this national tax applies to net wealth above 3 million euros and is designed to complement regional wealth tax. Regional wealth tax paid is deducted from it. See the solidarity tax.
Exemptions and planning
- Business assets and shares in family companies may be exempt if strict conditions are met.
- The combined limit with income tax can cap the bill for residents.
- Ownership structure, debt and the timing of a move to or from Spain affect the result.
Residents must also report assets abroad: see the modelo 720.
An illustrative example
Based on situations we commonly see; not a specific client. A Swiss couple each owned half of a villa in Andratx. As non-residents they could not use the main-home exemption, and the husband also had a Spanish bank account. We calculated the tax under the Balearic rules for each spouse and filed both returns, which turned out lower than they had feared because ownership was split.
This page is published by Castell.tax, the tax practice of Castell.law in Palma de Mallorca. It is general information; tax rules and rates change, so check your case with us before filing.
Not sure what you owe? Ask before the deadline
Send us your situation or the letter you received. A tax adviser will tell you what applies, what it could cost and what to file.
Questions about wealth tax in Spain
Do non-residents pay wealth tax in Spain?
Yes, on assets located in Spain, mainly property and Spanish accounts, above the exempt amount.
Is my main home exempt?
For residents, up to 300,000 euros of its value. Non-residents cannot use this exemption.
Can mortgages be deducted?
Yes, debts that financed the taxed assets reduce the taxable base.
Does joint ownership help?
Each owner is taxed on their share, so splitting ownership can reduce the total.