The 2013 UK-Spain Double Taxation Convention is one of the more straightforward UK income tax treaties. It allocates UK property taxing rights to the UK and Spanish property taxing rights to Spain, with credit relief on either side under the standard Article 22 elimination article. The complications are entirely outside the treaty itself. Three things drive the practical UK-Spain landlord position in 2026: the post-Brexit IRNR rate jump (UK residents now pay 24% on gross Spanish rental, not 19% on net), the Spanish wealth tax (Patrimonio) and the 2023 Solidarity Tax on Large Fortunes on UK property held by Spanish residents, and the Modelo 720 information-reporting obligation for Spanish residents with UK assets. None of these is in the treaty. All of them dominate the cross-border arithmetic. This page walks both directions: UK-resident with a Costa del Sol holiday let, and Spanish-resident with a UK BTL. For the OECD framework that sits underneath the bilateral, see our [UK tax treaties framework guide](/blog/non-resident-landlord-tax/tax-treaties-property-investors-treaty-framework-guide). ## Scenario A: UK-resident with a Spanish holiday let You bought a flat in Marbella in 2017 and let it on Airbnb for six months a year. You are UK-resident throughout. The Spanish flat is your second home. **Spanish side: IRNR at 24% gross since 1 January 2021.** The Impuesto sobre la Renta de No Residentes applies to non-resident landlords on Spanish-source rental income. Pre-Brexit (to 31 December 2020), UK residents qualified for the EEA rate of 19% on net rental income after deducting allowable expenses (interest, repairs, agent fees, depreciation, IBI local tax). Post-Brexit, UK residents sit in the non-EEA group: 24% on gross rental income with no expense deduction. For a flat producing €18,000 gross rent with €6,500 of allowable expenses (Spanish basis): - Pre-Brexit IRNR: €11,500 net × 19% = €2,185. - Post-Brexit IRNR: €18,000 gross × 24% = €4,320. The headline effective tax on the Spanish side has nearly doubled, with no treaty mechanism to soften it. **UK side:** The UK as residence state taxes the Spanish rental income on the foreign pages of self-assessment (SA106). The s.272A finance-cost restriction does not apply to overseas property businesses (which run as a separate property business under ITTOIA 2005 Pt 3); interest on a Spanish mortgage may be deductible in full subject to remitting the loan to the UK landlord's name and the property having been let. Foreign tax credit under TIOPA 2010 ss.18 and 130 offsets the Spanish IRNR against the UK tax on the same income, restricted to the UK tax on that income. For a UK higher-rate taxpayer, the UK tax on the €18,000 gross less €6,500 expenses (sterling-converted, say £10,000) is about £4,000 at 40%. The Spanish IRNR of €4,320 (~£3,700) is fully creditable, leaving £300 of UK top-up. The bigger problem is the cash outflow during the year: the Spanish IRNR is paid quarterly to the Agencia Tributaria; the UK foreign tax credit only relieves the UK tax when the UK return is filed the following January. **Spanish wealth tax (Patrimonio) for non-residents:** non-residents pay Patrimonio on Spanish-situs assets (the Spanish flat). The threshold is €700,000 net at state level. Most regional reductions for non-residents are limited; the practical exposure is generally low for single-property second-home owners, but high for large-portfolio non-resident investors. **Plusvalía Municipal on sale:** the local municipal capital gains tax on Spanish urban land. Trigger: any transfer of Spanish urban land. Computation: based on cadastral value increase over period of ownership, by reference to municipal coefficients. Often payable within 30 days of transfer regardless of whether the underlying disposal is at a gain or loss; constitutional challenge in 2021 led to revised computation rules (Real Decreto-ley 26/2021). ## Scenario B: Spanish-resident with a UK BTL You moved from Bristol to Valencia in 2023 for remote work. You kept your Bristol BTL flat. You are Spanish tax-resident from 2024 onwards. **UK side: NRL withholding plus standard UK income tax.** The UK retains primary taxing rights on the Bristol rent under Article 6. The Non-Resident Landlord scheme is statutory and applies regardless of treaty residence: 20% withholding by the letting agent or tenant unless you hold NRL1 approval. See our [non-resident landlord scheme complete guide](/blog/non-resident-landlord-tax/non-resident-landlord-scheme-uk-complete-guide) for the application mechanics. After NRL gross-payment approval (typical six-week turnaround), the Bristol rent flows gross. UK income tax under ITTOIA 2005 applies on the net rental profit. As a UK national, you keep the £12,570 personal allowance. The s.272A finance-cost restriction applies as for any UK-resident individual landlord. Net UK tax position usually low (often nil after personal allowance and the 20% s.24 credit on a small mortgage). **Spanish side: IRPF on the UK rental.** Spain taxes its residents on worldwide income through the Impuesto sobre la Renta de las Personas Físicas (IRPF). UK rental is included in the savings income / general income split depending on Spanish characterisation (rental from a let property is general income; rental from a non-let dwelling held available for letting falls into an imputed-income computation at 1.1% or 2% of cadastral value). For €15,000 net UK rental (sterling-converted), Spanish IRPF at the marginal rate (often 30%-37% combined state-and-region for higher earners) is around €4,500-€5,500. UK income tax credit under Article 22: restricted to the UK income tax on the same income (often near zero after personal allowance and s.24 credit). The Spanish IRPF therefore lands largely uncredited. **Spanish Patrimonio and the Solidarity Tax on Large Fortunes.** As a Spanish resident, your worldwide net wealth above the €700,000 threshold (€500,000 in Catalonia, nil-tax in Madrid through regional allowance) is within Patrimonio. The Bristol BTL goes into the wealth tax base at its market value. For a property worth £350,000 (about €410,000), plus other UK assets (savings, pension residual), you may sit close to or above the threshold. The 2023 Solidarity Tax on Large Fortunes (Impuesto Temporal de Solidaridad de las Grandes Fortunas) layered on top: 1.7% on €3m-€5m, 2.1% on €5m-€10m, 3.5% above €10m. For portfolio-scale UK holdings (multiple BTLs totalling over €3 million net), this is a material annual line. UK has nothing to credit because the UK has no wealth tax. **Modelo 720 reporting.** Spanish residents must declare foreign assets above €50,000 per category by 31 March annually. The Bristol BTL is in the "immovable property abroad" category and triggers Modelo 720 from the first year of Spanish residence. Penalties for late or non-filing now follow standard Ley General Tributaria rates (the disproportionate pre-2022 penalty regime was struck down by the CJEU in C-788/19 in January 2022 and replaced from 2023). **UK CGT on disposal:** UK NRCGT under [TCGA 1992 s.1A and Schedules 1A, 1B and 4AA](/blog/non-resident-landlord-tax/non-resident-cgt-uk-property-rates-reporting). 60-day UK property return required regardless of tax due. 18% / 24% residential rates. Spain then computes its own ganancia patrimonial on the gain (rates 19%-28% across savings income bands) with UK credit under Article 22. ## The 2013 treaty article walk Quick reference to the article numbers in the 2013 UK-Spain treaty: - **Article 4 (residence)** uses the OECD-style tie-breaker cascade for individuals. Engages where SRT result + Spanish 183-day residence rule conflict. - **Article 6 (immovable property)** gives the situs state primary taxing rights on rental income. - **Article 13 (capital gains)** allocates direct disposal of immovable property gains to the situs state under paragraph 1; property-rich entity shares (over 50% from immovable property) under paragraph 4. - **Article 22 (elimination of double taxation)** uses the credit method for both directions; restricted to the residence-state tax on the same income. - **Article 23 (non-discrimination)** floors the personal allowance availability for Spanish nationals. - **Article 25 (Mutual Agreement Procedure)** with the standard three-year notification window. The article framework is OECD-standard. The action sits in domestic Spanish rules layered on top. ## Worked example: a portfolio Spanish-resident landlord Carlos, a Spanish national, moved from Birmingham to Valencia in 2024. Spanish tax-resident from 2025 onwards. Owns three UK BTL properties (Birmingham, Coventry, Wolverhampton) totalling £880,000 current value (about €1,030,000) with £540,000 of interest-only mortgage debt. Annual gross UK rent £52,800; annual UK mortgage interest ~£21,600; allowable UK expenses ~£8,200. **UK side, 2026/27.** - All three properties on NRL gross-payment approval (Carlos applied in March 2025, HMRC approved May 2025). - UK rental profit: £52,800 less £8,200 expenses = £44,600 (mortgage interest added back per s.272A). - UK personal allowance £12,570 (UK national). - UK income tax: £44,600 less £12,570 = £32,030 taxable. £37,700 basic-rate band, so £32,030 at 20% = £6,406. - Section 24 credit: 20% of £21,600 = £4,320; capped at 20% of rental profit before s.24 (£66,200) = £13,240; full £4,320 usable. - UK income tax net: £6,406 less £4,320 = £2,086. - 60-day return: not applicable for ongoing rent. **Spanish side, 2026 calendar year.** - IRPF on UK rental (sterling-converted, say €52,000 net after Spanish expense rules): marginal rate around 37% combined for Carlos's wider income = ~€19,250. - UK income tax credit under Article 22: ~£2,086 ≈ €2,440. Spanish IRPF net of credit: ~€16,800. - Patrimonio: net UK property assets ~€490,000 (€1,030,000 less €630,000 sterling-converted mortgage). Combined with Carlos's other Spanish assets and Spanish pension, he sits at ~€1.2m net wealth. Above the €700,000 Patrimonio threshold; in Valencia, Patrimonio applies at progressive rates. Tax: ~€2,200 a year. - Solidarity Tax: Carlos is below €3m so no Solidarity Tax. - Modelo 720: filed by 31 March each year covering the three UK properties. **Net cost of the cross-border position:** £2,086 UK + €16,800 Spanish IRPF + €2,200 Patrimonio + €0 Solidarity = roughly €22,400 annually (sterling equivalent ~£19,000). Carlos's pre-move UK-resident position on the same portfolio was around £8,500 a year (lower because UK personal allowance and s.24 credit covered more of the higher-rate position). Net increase of ~£10,500 a year, largely driven by the uncredited portion of Spanish IRPF and the new Patrimonio line. The treaty does what it can; the Spanish residence move costs about £10k a year more than the UK-resident position on identical UK rental income. ## Compliance: NRL1, HS304, Modelo 720, Patrimonio return The UK-Spanish landlord runs annual returns on both sides. **UK side (Scenario B, Spanish resident with UK property):** - NRL1 application (one-off, lapses if circumstances change). - UK self-assessment by 31 January with UK property pages (SA105). - HS304 claim for personal allowance under treaty non-discrimination article (if needed). - 60-day NRCGT return on disposal of UK land regardless of tax due. **Spanish side:** - IRPF (Modelo 100) annually, generally by 30 June. - Patrimonio return (Modelo 714) if net wealth above the threshold on 31 December. - Solidarity Tax return (Modelo 718) if net wealth above €3 million. - Modelo 720 information return on foreign assets by 31 March if any category above €50,000. **UK side (Scenario A, UK resident with Spanish property):** - Quarterly Spanish IRNR returns (Modelo 210) within 20 days of quarter-end. - UK self-assessment with foreign pages (SA106) for the Spanish rental. - Foreign tax credit under TIOPA 2010 for Spanish IRNR paid. ## Common traps for UK-Spanish landlords Five traps catch UK-Spanish landlord positions most often: 1. **Post-Brexit IRNR rate shift.** UK residents with Spanish holiday lets often still budget at the pre-2021 19% net rate. The 24% gross rate is now correct. Modelling errors compound across multi-year holds. 2. **Failing to file NRL1 promptly.** Spanish residents with UK BTLs often miss the NRL1 application, leaving the letting agent or tenant to withhold 20% unnecessarily. Cash flow is hurt for the year between Spanish residence and NRL1 approval. 3. **Modelo 720 underreporting.** Spanish residents who move from the UK often don't realise UK assets above €50,000 per category trigger Modelo 720. Bank accounts, pension lump sums received, and UK securities all count separately from UK property. Late or non-filing is now under standard penalty rates (post-2023 reform), but still material. 4. **Treating Patrimonio as creditable in the UK.** It is not. UK has no wealth tax to credit. Patrimonio and Solidarity Tax sit outside the treaty; the UK side gives no relief. 5. **Ignoring Plusvalía Municipal on a Spanish disposal.** UK-resident sellers of Spanish urban land routinely miss the 30-day Plusvalía deadline. Local councils enforce promptly. The 2021 constitutional decision changed the computation but not the obligation. ## What to do next The UK-Spain position is treaty-clean and overlay-heavy. The treaty itself does its job. The Spanish-side overlays (Patrimonio, Solidarity Tax, Modelo 720, Plusvalía Municipal) and the post-Brexit IRNR rate jump dominate the cross-border arithmetic. - **Confirm your scenario.** UK-resident with Spanish holiday let (Scenario A) or Spanish-resident with UK BTL (Scenario B)? - **Get the right rate on the IRNR side.** 24% gross post-Brexit, not 19% net. Quarterly Modelo 210 to the Agencia Tributaria. - **Run the Patrimonio threshold check** if Spanish residence is on the table. Add the Solidarity Tax if portfolio net above €3 million. - **File Modelo 720 by 31 March** each year of Spanish residence. - **Coordinate UK + Spanish compliance** through advisers on both sides; the credit calculation has to align across two tax-year frameworks (UK 6 April to 5 April; Spanish 1 January to 31 December). - **For framework context**, see our [UK tax treaties framework guide](/blog/non-resident-landlord-tax/tax-treaties-property-investors-treaty-framework-guide); for NRL operational detail in Scenario B, see the [non-resident landlord scheme guide](/blog/non-resident-landlord-tax/non-resident-landlord-scheme-uk-complete-guide) and the [20% NRL withholding deduction page](/blog/non-resident-landlord-tax/nrl-withholding-tax-20-percent-basic-rate-deduction). For UK disposal operational detail, the [non-resident CGT selling guide](/blog/non-resident-landlord-tax/non-resident-cgt-selling-uk-property-overseas-guide) walks the 60-day return. The treaty hands you the easy half of the answer. The hard half is the post-Brexit IRNR shift and the Spanish wealth-tax overlay, neither of which the treaty touches.