Undeclared rental income in Spain: Modelo 210 guide

For a non-resident owner, regularising means filing, on your own initiative, the Form 210 returns you never submitted, paying the tax and the surcharge, before the Spanish Tax Agency (AEAT) asks you to. It covers the tax years not yet time-barred and replaces a penalty with a surcharge.

The starting point surprises many foreign owners: rent from a property located in Spain is taxed in Spain even if the owner never sets foot in the country and the tenant pays into an account in Munich or Miami.

What about your double taxation treaty? It does not exempt you. Spain’s treaties follow the OECD model and give taxing rights over property income to the country where the property sits; the treaty then works in your country of residence, to relieve double taxation.

Four years. Article 66 LGT sets that limitation period for the tax authority’s power to assess, counted from the day after each return’s filing deadline expires (article 67). Anything older is time-barred and should not be regularised.

Here is the trap for anyone who thinks in calendar years: non-resident income tax without a permanent establishment is declared income by income, and each accrual goes on its own return unless you elect to group. From 2024 accruals onwards, rental income from the same property, the same payer and at the same rate may be grouped annually. Before that, the split was quarterly.

Order HAC/623/2026, in force since 24 June 2026, has redrawn the calendar:

In a regularisation these deadlines have all passed. The calendar still matters: it fixes the day from which the months of delay run, and with them the surcharge.

The taxable base is the gross amount received from the tenant, excluding VAT and, as a general rule, with no deduction of expenses (article 24.1 IRNR). The exception in article 24.6, and the rate in article 25, turn on where the owner lives.

Numbers make the gap clear. A French-resident owner lets a flat in Valencia for all twelve months of 2024 at €900 a month: €10,800 of income. Expenses for the year: €320 council tax (IBI), €720 service charges, €180 insurance, €400 repairs and €2,700 depreciation (3% of the building value). Total €4,320. Net income: €6,480. Tax at 19%: €1,231.20. The same flat with a US-resident owner: 24% of the gross €10,800, or €2,592. More than double.

That outcome is what the Spanish National Court (Audiencia Nacional), Administrative Chamber, judgment of 28 July 2025 (appeal 636/2021) found contrary to the free movement of capital in article 63 of the Treaty on the Functioning of the European Union, which protects residents of third countries too. The court allowed a US resident to deduct expenses under the IRNR.

The State Attorney’s Office appealed, and the Supreme Court (Tribunal Supremo) admitted the appeal by order of 15 July 2026 (appeal 6741/2025). The key will be article 64.1 of the Treaty, which lets Member States keep restrictions on direct investment from third countries, including in real estate, that existed on 31 December 1993. Until the judgment arrives, the prudent course for a non-EU owner with significant expenses is to regularise on the AEAT’s criterion and, in parallel, request rectification of the years still open.

One warning that saves trouble: the reduction for residential letting in article 23.2 of the Personal Income Tax Act does not apply to the IRNR, because article 24.1 IRNR rules out reductions. The Central Economic-Administrative Tribunal (TEAC) confirmed this in its ruling of 16 December 2020 (case 00/04465/2019), concerning a Portuguese resident, and has repeated it since, for instance on 20 March 2024 (case 1093/2021). Neither the old 60% nor the percentages in force today. The European Commission considers this exclusion discriminatory: in June 2026 it sent Spain an additional letter of formal notice in infringement procedure INFR(2018)4085, opened in March 2019. Until the law changes, the administrative criterion is the TEAC’s.

Empty months are taxed too. For periods when the property was not let, imputed income applies: 1.1% of the cadastral value where the municipality has carried out a general revaluation in force during the previous ten tax periods — or, for 2023, 2024 and 2025, where the revaluation took effect on or after 1 January 2012 — and 2% otherwise. It accrues on 31 December and is pro-rated for the days the property was at the owner’s disposal. Royal Decree-law 29/2026, of 6 October, extends the 2012 rule to 2026; at the date of this update it was still awaiting parliamentary validation.

The surcharge also carries a 25% reduction where it is paid within the voluntary period opened by its notice and the tax itself has been paid on filing or under an agreed instalment plan.

Back to the French example. The €1,231.20 for 2024 fell due on 20 January 2025. Filed in November 2026, more than twelve months have passed: a 15% surcharge, €184.68, which the reduction brings down to €138.51, plus interest from 21 January 2026. If an AEAT letter arrives first, the same tax bill can carry a penalty of €615.60 (50%, before reductions), plus interest.

Six errors recur: forgetting the imputed income for empty months; applying the Personal Income Tax letting reduction; filing a single annual Form 210 for years before 2024; paying 24% because no residence certificate was obtained; declaring the whole of a jointly owned property; and not checking whether the tenant withheld tax. That last one matters: where the tenant is a business or professional — typically commercial premises — they must withhold and pay the tax, and an owner who has borne that withholding is not required to declare the income again. In a residential letting to a private individual there is no withholding and the obligation falls entirely on the owner.

As for detection, drop the idea that rent collected abroad goes unnoticed. The 2026 Annual Tax and Customs Control Plan guidelines (Resolution of 11 March 2026 of the AEAT’s Directorate-General) step up checks on rental income, with particular attention to lettings managed through digital platforms, and provide for action on non-residents who hold assets in Spain. The information reaches the AEAT through three channels: Form 238, which brings digital platform data into Spain under the DAC7 Directive and replaced Form 179 from 2024; the Digital One-Stop Shop for Rentals (Ventanilla Única Digital de Arrendamientos) under Royal Decree 1312/2024, which the Supreme Court upheld in judgment 620/2026 of 19 May 2026 while striking down the national single registration number; and internal cross-checks against the Cadastre, regional rental deposit registers and utility consumption.

How far back can the Spanish tax authority go for undeclared rent? Four years. Article 66 LGT sets that limitation period, counted from the day after each Form 210 deadline expires. Older years are time-barred. Note that if the AEAT notifies any audit or verification step, the period is interrupted and starts again (article 68 LGT).

What surcharge do I pay if I file Modelo 210 late? 1% plus a further 1% for each complete month of delay in the first year, capped at 12%. After twelve months the surcharge is 15% plus late payment interest. In both cases the penalty is excluded, and the surcharge is cut by 25% if paid within the voluntary period.

I live outside the EU. Can I deduct my rental expenses? The wording of article 24.6 IRNR reserves that deduction for EU and EEA residents. On 28 July 2025 the Audiencia Nacional extended it to a US resident under the free movement of capital, and on 15 July 2026 the Supreme Court agreed to hear the State’s appeal. Until it rules there is no settled answer, but filing a rectification request now stops the open years from becoming time-barred in the meantime.

I am in the UK. Did Brexit change my position? Yes. The United Kingdom is no longer an EU or EEA state, so under the letter of the law British owners are taxed at 24% on gross rent with no deduction of expenses. The 2025 National Court judgment, now before the Supreme Court, is the argument to watch, and it applies to UK residents on the same free-movement-of-capital reasoning.

Do I have to declare the months the property sat empty? Yes. Imputed income applies for those days: 1.1% or 2% of the cadastral value depending on the municipality, pro-rated and accruing on 31 December. It is the item most often forgotten and the first to surface, because the Cadastre already identifies the owner.

Can I file a single Modelo 210 for the whole year? For 2024 accruals onwards, yes: rental income from the same property, the same payer and at the same rate can be grouped annually. If you group your 2026 rent, the window is 1 to 20 April 2027. For 2023 and earlier, no — one return per calendar quarter in which the income accrued.

What if my tenant already withheld the tax? If the tenant was required to withhold, as a business or professional, and did so correctly, that income is not declared again. Check the withholding certificate: declaring income that has already been withheld means claiming the overpayment back later.

Can I be penalised if I come forward myself? Not for failure to pay. Article 27 LGT replaces the penalty with a surcharge where the return is filed without a prior request from the authority. That is the point: without a prior request. Once an audit or verification has been notified, the surcharge route closes.

Coming forward on your own swaps a penalty that starts at 50% of the tax for a surcharge of 1% to 15%, which the 25% reduction brings down to between 0.75% and 11.25% (plus interest after twelve months). The final bill depends on who moves first: you or the AEAT. Pulling together the contracts, the IBI receipt and a residence certificate takes less time than most owners expect.

If you own a let property in Spain and have not filed Form 210, we can help at Martínez-Cardós Abogados, a Madrid firm specialising in tax for non-residents. We will check which years remain open, what the surcharge amounts to today and which expenses you can deduct given your country of residence, and submit the form for you. You can tell us about your case through our contact page.