UK owners and Modelo 210 after Brexit: 24% on gross rent – and the court case that could change it
Since the UK left the EU, British residents who let a home in Spain have paid more than their German or Dutch neighbours: 24% on the gross rent, with no expenses deducted. A 2025 court ruling challenged that. Here's where things stand and what it means in practice.
The rule today
Spanish non-resident income tax lets residents of the EU and of EEA states with tax information exchange (Iceland, Norway, Liechtenstein) deduct expenses and pay 19%. Everyone else – including UK residents since 1 January 2021 – is taxed at 24% on the full amount. The tax agency applies this rule today, and its official guidance still says so.
| Same flat, 2026, let for 120 nights for €15,000 | German resident | UK resident |
|---|---|---|
| Expenses (commissions, cleaning, community fees, depreciation…) | – €5,934.82 | not deductible |
| Tax base | €9,065.18 | €15,000.00 |
| Rate | 19% | 24% |
| Tax on the rent | €1,722.38 | €3,600.00 |
(Figures from our rental income guide example.) On top of that, both owners pay tax on imputed income for the days the flat wasn't let – at 24% for the UK owner.
The July 2025 ruling (SAN 3630/2025)
On 28 July 2025 Spain's National High Court (Audiencia Nacional, appeal 636/2021) decided the case of a US resident who rented out a flat in Barcelona and had been refused her expenses. The court held that limiting the deduction of expenses to EU/EEA residents is contrary to EU law on the free movement of capital (art. 63 of the Treaty on the Functioning of the EU), which also protects capital moving to and from non-EU countries.
The State appealed. According to published professional commentary (not yet checked against the original order), the Supreme Court admitted the appeal by an order of 15 July 2026, to decide whether the restriction breaches art. 63 TFEU or is protected by the "standstill" clause (art. 64.1 TFEU) or otherwise justified (art. 65). A referral to the EU Court of Justice is possible. There is no final decision yet.
What it means in practice
- File as the law says today: 24% on gross rent. Filing with expenses deducted as if you were an EU resident invites an assessment, surcharges and interest.
- Keep every invoice anyway – in your name, with proof of payment – and a certificate of UK tax residence. If the Supreme Court confirms the ruling, those documents are what a claim would be built on.
- Ask an adviser about protective claims. A rectification of past returns can generally be requested within four years. Some advisers recommend filing claims now so older years don't drop out of that window; others prefer to wait for the Supreme Court. This is a judgement call for a professional who knows your case.
- Know the size of the prize. In the example above, the difference is about €1,424 a year. For a flat let only a few weeks a year it may be small; for a busy holiday let over four years it can be significant.
See your own 24% figure – and the what-if if expenses were allowed: free Modelo 210 calculator →
Other points for UK owners
- Deadlines are the same for everyone: 2026 rent → 1–20 April 2027; imputed income for 2025 → by 31 December 2026.
- Spanish tax representative: non-EU residents only have to appoint one in specific cases (for example, if the tax agency requires it because of the property, or for countries without tax information exchange). For a single let flat it's usually not mandatory, but many owners use a gestor anyway.
- UK tax: you also report the Spanish rent to HMRC and claim relief for the Spanish tax under the UK–Spain double tax treaty. Ask a UK adviser.
- Mixed couples: if one owner lives in the EU and the other in the UK, each files separately at their own rate.
The Modelo 210 Organiser logs your expenses all year even though you can't deduct them today – so you're ready either way. Join the waitlist →
Sources
- Non-Resident Income Tax Act, art. 24.1 and 24.6 (expenses only for EU/EEA residents) and art. 25.1.a (19% / 24%): BOE-A-2004-4527
- Non-Resident Income Tax Act, art. 10 (tax representative): BOE-A-2004-4527
- Tax agency – non-resident manual, income from real estate: sede.agenciatributaria.gob.es
- National High Court judgment of 28 July 2025, appeal 636/2021, ECLI:ES:AN:2025:3630 – search in the judiciary's database: poderjudicial.es (CENDOJ)
- Supreme Court admission order of 15 July 2026 (ECLI:ES:TS:2026:7675A) – reported by professional commentary (Cuatrecasas, 16-09-2026); not yet checked against the original text.
- Deadlines: Order HAC/623/2026, BOE-A-2026-13573