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Renting out taxes

Posted: Mon Oct 17, 2022 12:13pm
21 replies297 views4 members subscribed
Pete 147

Pete 147

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Hi everyone,  is it straight forward to submit the taxes on a holiday rental apartment.  As far as I understand you have to submit two. One regarding the time it’s rented out and another for the time it’s not rented out.  Any help is much appreciated.  👍

jorge1306

Posted: Mon Oct 17, 2022 2:35pm

jorge1306

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Posted: Mon Oct 17, 2022 2:35pm

You need a tourist licence for holiday rebtald pay 24 per cent tax on declared rentals and no longer able to deduct expenses  ..once you have paid your electric bill you are looking at 40 per cent of what you get gross if you advertise on the big players websites 

Pete 147

Posted: Mon Oct 17, 2022 3:14pm

Pete 147

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Posted: Mon Oct 17, 2022 3:14pm

Hi ,  I’m not sure why big player websites will affect how much tax I pay .  I was under the impression that you pay two amounts depending on when you rented it out and not rented it out.  One will be 19% and the other 24% .  Is this not correct? 

jorge1306

Posted: Mon Oct 17, 2022 4:18pm

jorge1306

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Posted: Mon Oct 17, 2022 4:18pm

Pete 147 wrote on Mon Oct 17, 2022 3:14pm:

Hi ,  I’m not sure why big player websites will affect how much tax I pay .  I was under the impression that you pay two amounts depending on when you rented it out and not rented it out.  One will be 19% and the other 24% .  Is this not correct? 

Not that I am aware ..19 per cent tax pre brexit 24 per cent post brexit..don't pay when you don't rent out just your usual taxes depending on status 

jorge1306

Posted: Mon Oct 17, 2022 4:20pm

jorge1306

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Posted: Mon Oct 17, 2022 4:20pm

Pete 147 wrote on Mon Oct 17, 2022 3:14pm:

Hi ,  I’m not sure why big player websites will affect how much tax I pay .  I was under the impression that you pay two amounts depending on when you rented it out and not rented it out.  One will be 19% and the other 24% .  Is this not correct? 

It's either a nil return or a return if you rented on which you pay 24 per cent tax if UK citizen ...19 per cent if you are EU resident 

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Pete 147

Posted: Mon Oct 17, 2022 4:25pm

Pete 147

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Posted: Mon Oct 17, 2022 4:25pm

jorge1306 wrote on Mon Oct 17, 2022 4:20pm:

It's either a nil return or a return if you rented on which you pay 24 per cent tax if UK citizen ...19 per cent if you are EU resident 

Many thanks…. I’m coming over to Spain soon so I’ll just and get a better understanding when I’m there.   Much appreciated for your comments 👍

Pete 147

Posted: Mon Oct 17, 2022 4:28pm

Pete 147

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Posted: Mon Oct 17, 2022 4:28pm

Another point , I’ve just read by using Airbnb this helps in some way!  Any ideas ?

Christine65

Posted: Wed Oct 19, 2022 5:09pm

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Posted: Wed Oct 19, 2022 5:09pm

Pete 147 wrote on Mon Oct 17, 2022 4:28pm:

Another point , I’ve just read by using Airbnb this helps in some way!  Any ideas ?

Hi, Your original query was correct. If you are a non  resident from the UK but own a spanish property you rent out then you pay several taxes. I assume you are legal, (registered with the murcia tourist authority and are paying IBI?). Additionally, you must pay 24% of gross rental income you receive, as a non res from UK you are no longer eligible for any deductions against gross income) . This tax is paid quarterly - you submit a nil income statement for any quarter you do not rent out. However you also pay imputed rental income tax for any period you do not rent the apartment out, this is calculated by reference to your annual Council tax, (IBI). 

My advice if you are non resident is to use a Gestor (much cheaper than a solicitor or accountant and often much better) to calculate and pay both taxes for you. I do and my Gestor charges 60 Euro a quarter when he  has to submit a tax return, nothing when he doesn't but he also set up all my direct debits for all my other bills so I always have complete peace of mind regarding my bills taxes and so forth, so from my perspective well worth the money.

I think the reference to using one of the large agencies to rent out your property  in another post refers to the changed tax situation for non resident landlords. The inability to deduct council tax, management fees, utility bills, repairs and any fees you incur advertising via Vrbo etc means it is a lot less profitable since Brexit to rent out property - roughly 40% net income rather than 70% before Brexit, which is why so many Brits are now selling.

Hope this helps

Pete 147

Posted: Wed Oct 19, 2022 5:18pm

Pete 147

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Posted: Wed Oct 19, 2022 5:18pm

Yes, thank you so much.  Everything will be legal 😂 we are uk based and have decided to invest in a property in Murcia.  So any help is very much appreciated.  As long as our mortgage, communal fees and utilities are covered each month we are happy.  Any other ideas or information you may have , we would love to hear it.  👍

JackieSo

Posted: Wed Oct 19, 2022 5:37pm

Posts: 35

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Posted: Wed Oct 19, 2022 5:37pm

Christine65 wrote on Wed Oct 19, 2022 5:09pm:

Hi, Your original query was correct. If you are a non  resident from the UK but own a spanish property you rent out then you pay several taxes. I assume you are legal, (registered with the murcia tourist authority and are paying IBI?). Additionally, you must pay 24% of gross rental income yo...

...u receive, as a non res from UK you are no longer eligible for any deductions against gross income) . This tax is paid quarterly - you submit a nil income statement for any quarter you do not rent out. However you also pay imputed rental income tax for any period you do not rent the apartment out, this is calculated by reference to your annual Council tax, (IBI). 

My advice if you are non resident is to use a Gestor (much cheaper than a solicitor or accountant and often much better) to calculate and pay both taxes for you. I do and my Gestor charges 60 Euro a quarter when he  has to submit a tax return, nothing when he doesn't but he also set up all my direct debits for all my other bills so I always have complete peace of mind regarding my bills taxes and so forth, so from my perspective well worth the money.

I think the reference to using one of the large agencies to rent out your property  in another post refers to the changed tax situation for non resident landlords. The inability to deduct council tax, management fees, utility bills, repairs and any fees you incur advertising via Vrbo etc means it is a lot less profitable since Brexit to rent out property - roughly 40% net income rather than 70% before Brexit, which is why so many Brits are now selling.

Hope this helps

Hope you don’t mind me jumping in on this thread.

I’m an EU resident and would like to buy to rent. What taxes rates are incurred for EU residents and are there deductibles allowances for repairs etc.

Also is it worth it to rent out taking into account the taxes and property management/cleaning.

Sorry for all the questions but am new to this and just really want to cover fees/taxes and community fees if any and any maintenance that may be required 

Thanks

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