British homeowners with multiple properties in Spain could face a 100% surcharge on their annual property tax if they leave a home empty for more than three years. The rules give Spanish town halls powers to increase the tax bills of certain empty homes as the country tries to tackle its housing shortage.
How the surcharge works
The charge applies to Spain's annual property tax, known as IBI, rather than being a new tax on the value of a home. Councils can impose a surcharge of up to 50% when a qualifying residential property has been continuously empty for more than two years without a justified reason. If the property remains empty for more than three years, the surcharge can rise to 100%.
However, the rules generally apply to properties belonging to owners with four or more residential properties. This means a Briton who owns just one holiday home in Spain would not automatically face having their IBI bill doubled under this provision.
Exemptions for second-home owners
There are also important exemptions which could protect second-home owners. The legislation recognises the use of a property as a second home as a justified reason for it to remain empty for up to four continuous years.
Other accepted reasons include properties undergoing renovation or rehabilitation. Homes being offered for sale can also be exempt for up to one year, while properties being offered for rent can qualify for an exemption of up to six months. Temporary moves for work or education and some health-related circumstances are among the other reasons recognised by the legislation.
Local council discretion
This means a British-owned holiday home that is unused for long periods will not automatically face the higher charge. The surcharge is also not imposed automatically across Spain. Instead, local councils have the power to introduce it when the conditions set out in the legislation are met.
The measures form part of Spain's efforts to tackle a housing shortage that has become particularly acute in popular cities and tourist destinations. Spanish authorities have been looking for ways to encourage more homes back onto the residential market as residents struggle with rising housing costs and limited supply.
For British owners, the impact will therefore depend on factors including how many residential properties they own, how long the Spanish property has been empty, why it is unoccupied and whether the local council applies the surcharge.
