2. Spanish Property Law
For the most comprehensive analysis of
Property Law in Spain written in English go to:
Spanish Property Law
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3. Income Tax Deductions in Spain
There are 17 autonomous communities or regions in Spain
and each has competency to regulate tax exemptions and
deductions within it’s territory.
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4. Income Tax Deductions in Spain
However, the central state government also regulates income
taxes.
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5. Income Tax Deductions in Spain
Both systems work together in a complex arrangement that
means that taxpayers pay a proportion of their taxes to the
central government and the remainder to their local
government.
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6. Income Tax Deductions in Spain
So when we refer to a tax deduction available in a particular
region, this may not be the whole story.
Additional deductions, with different qualifying criteria, may
also exist at a state level.
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7. Income Tax Deductions Balearic Islands
If you have dealings with property and pay income tax in the
Balearic Islands then you may be in line for a tax break.
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8. Purchase of the Primary Residence
In addition to the deductions available at the state level, law
1/2009 establishes the rate of tax deduction available for
those property purchases in the Balearic Islands where the
property is the principal private residence of the purchaser as
being 4.5%.
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9. Refurbishment of the Primary
Residence
Where an investment is made to refurbish a primary
residence to make it suitable for the disabled, the tax
deduction at the regional level is 9.9%
When added to the state portion of the deduction the total
deduction is 20% upon a maximum base of €12,080
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10. Special Tax Breaks to Make Home
Ownership Accessible to Young People
Any residents under the age of 36 investing in a primary
personal residence (or renovating an existing property for this
purpose) may take advantage of an increased deduction of
6.5% up to a maximum base of €11,000.
The maximum net income is set at €18,000 individually or
€30,000 if a joint declaration
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11. Renting the Primary Home
Residents of the Balearic Islands who are:
1) under the age of 36, or
2) Disabled to a degree > 65%, or
3) Parents of Children in 'large families'
may apply a deduction of 15% of rental money paid up to a
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12. Renting the Primary Home
maximum of €300 annually where various administrative rules
are followed.
The maximum net income is set at €18,000 individually or
€30,000 if a joint declaration or in the case of large
families, €24,000 individually or €36,000 where a joint
declaration is made.
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13. Property or Land Specially Protected
50% of the upkeep and improvement costs relating to property
or land that is subject to protection orders may be deducted
against income tax.
The property or land should be that contemplated in Article 19.1
a, b or c of Law 6/1999
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14. For more information or assistance with legal or tax
matters from our network of local English-speaking
property lawyers in the Balearic Islands, go to:
Property Lawyers in the Balearic Islands
Source AEAT
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