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Thinking of moving to Spain from the UK? Here’s everything you should know about how taxes in Spain work for UK expats.
How do Spanish Tax Rules Affect UK Expats?
So, what’s the deal with Spanish tax for British citizens? Let’s start by breaking down the basics.
When you move to Spain, your tax residency status will determine how much tax you pay.
You’re considered a resident according to Spanish tax law if you spend more than 183 days in the country within a calendar year, or if your main economic interests are based there.
- If you’re classed as a tax resident, you’ll be taxed on your worldwide income (that’s an aggregation of your domestic income if you work in Spain, as well as your foreign income, for example, if you continue with UK-based employment.
- If you’re a non-resident, you’ll only pay Spanish tax on any income you earn in Spain.
Spanish tax rates vary depending on your region. There are national bands that apply to everyone, but it’s worth being aware that each autonomous community can apply its own surcharges, and these are known to change annually.
You can use a Spanish Tax Calculator to get an estimate that’s tailored to your region and how much you earn.
What to Know About Income Tax Spain?
So, how much tax do you pay in Spain?
As it is in the UK, Income Tax in Spain for residents is progressive, meaning that the more money you earn, the higher the percentage of tax you pay on the portion of income that falls into each tax band.
In 2025, the national Spanish Taxation rates start at 19% for incomes up to 12,450 and rise to 49% for income above €300,000.
If you’re planning to live in Catalonia or Valencia, keep in mind that these and several other regions apply additional rates, so you may end up paying more taxes depending on where you settle on.
If you’re classified as a non-resident in Spain, your income tax situation will be different: you’ll pay a flat 24% on any income sourced in Spain.
This is an occasion where not being an EU resident will put you at a disadvantage, as EU/EEA residents pay a reduced tax rate of 19%.
Do UK Residents in Spain Have to Pay Double Taxation?
The good news is that you won’t be taxed twice on the same income when you move to spain thanks to the UK Spain Double Tax Treaty.
That said, you’ll still need to declare your global income if you’re a Spanish tax resident.
You might also need to file a UK Self Assessment (for example, if you’re registered as self-employed or earn income from an investment property in the UK), or pay UK Inheritance Tax on your estate, even after you become a resident of Spain.
What Should You Know about Modelo 720 and Wealth Reporting?
As a resident in Spain, you’ll need to report all your overseas assets worth over €50,000—including your bank accounts, real estate, pensions, and life insurance—using Modelo 720 Spain.
It’s really important that you do this to avoid facing legal trouble, although the related penalties are no longer enforceable after the European Court of Justice ruled in 2022 that they were excessive.
If you have worldwide assets over €700,000 (excluding a €300,000 main home allowance), you’ll also need to pay Spanish Wealth Tax, although you may be exempt or face progressive charges depending on where exactly you’re located.
Capital Gains, Inheritance, and Death Tax in Spain
Capital Gains Tax Spain ranges from 19% to 28%, and this depends on the gain amount. If you’re classed as a non-resident, you’ll usually pay 19%.
Good news if you’re over 65 and meet certain conditions: gains on your main residence may be exempt.
Moving on to Succession Tax in Spain, this is based on both the relationship to the deceased and the location. You might be entitled to a generous reduction, again depending on the region you’re living in.
And finally, here’s what to know about Spanish Inheritance Tax and Death Tax:
- Spanish Inheritance tax applies regardless of where the deceased or the heir to their assets lives, if these assets are in Spain. Just be aware that this may overlap with UK Inheritance Tax rules.
- In Spain, rather than being a separate levy, Death Tax is actually just another term often used for Inheritance or Succession Tax Spain.
Should You Submit a Spanish Tax Return?
If you’re classed as a resident and you’re earning above the exemption threshold, there’s a good chance that you’ll need to file a Spanish Tax Return between April and June.
You’ll also need to file a Tax Declaration Spain form for any foreign income you receive, as well as Modelo 720 (if applicable).
As for Dividend Tax in Spain, this is considered savings income, and it’s taxed at the same rates as capital gains. These were recently increased and range from 28% to 30% as of 2025.
What Are The New Rules For Residency in Spain?
Under the new Spanish Taxation rules post-Brexit, if you’re a British citizen planning to stay in Spain for longer than 90 days within a 180-day period, you’ll now need a visa.
If you’re making a permanent move, things are a bit more complicated than they used to be: you’ll now need to apply for a residency permit, as well as register with the tax authority.
Keep in mind that paying taxes for expats can be pretty complex due to ongoing UK ties, so contact a professional advisor if you’re struggling.