Posted: Tue Jul 6, 2021 4:12pm
Firstly, when buying the property, you should allow an additional 12%-13% on top of the purchase price for the associated costs (the most significant is property purchase tax, which is 8%-10% in Spain - depending on the region; compared to 1.5% Stamp Duty in the UK). You also need to register the property as a rental property in Spain and meet certain safety conditions.
You then need to declare the income received via a tax self-assessment form in the UK; and you also need to declare the income in Spain. However, Spain and the UK have a double taxation agreement, so you can off-set the tax paid in one country against that paid in another - so you can't be taxed twice. Spain has recently slightly increased the tax rate and also removed some of the allowances that you can offset against tax.
I hope this helps - however, as with any major purchase, you should seek professional advice. There are plenty of companies both in the UK and Spain that will be able to advise you. A quick google search found the following (but I've never used them so can't recommend one way or the other)...
https://www.taxrebateservices.co.uk/tax-faqs/uk-landlord-faqs/tax-on-letting-property-in-Spain