Owning a holiday rental property in Marbella — especially in areas such as Cabopino, Elviria, Río Real, Nueva Andalucía and San Pedro de Alcántara — can be highly profitable, but many owners underestimate the importance of proper tax compliance in Spain.

Whether you live in Spain or abroad, rental income generated from a property located in Andalusia is subject to Spanish taxation. Failing to declare correctly can lead to penalties, audits, and serious legal complications.

Do Holiday Rental Owners in Marbella Have to Pay Tax in Spain?

Yes. All income generated from renting a property located in Spain must be declared in Spain, regardless of whether the owner is a Spanish resident, EU resident or non-EU resident. Tax obligations apply to apartments, townhouses and villas used for short-term or holiday rentals in Marbella.

While tax rates and deductible expenses may differ depending on residency status, declaring rental income is always mandatory.

Whether you live in Spain or abroad, rental income generated from a property located in Andalusia is subject to Spanish taxation. Failing to declare correctly can lead to penalties, audits, and serious legal complications.

Understanding your tax obligations from the start helps you:

• Avoid fines and interest charges

• Protect your investment

• Plan realistic net returns

• Operate your rental business legally and sustainably

In this guide, we explain the main tax responsibilities for holiday rental owners in Marbella, especially for non-resident investors, and how professional management helps keep everything under control.

Are Holiday Rental Owners in Marbella Required to Pay Tax in Spain?

Yes. All income generated from renting a property located in Spain is taxable in Spain, regardless of where the owner lives.

This applies to:

• Spanish residents

• EU residents

• Non-EU residents

There are differences in how income is taxed and which expenses can be deducted, but declaration is always mandatory.

Non-Resident Income Tax (IRNR): The Most Common Tax for Foreign Owners

Most holiday rental owners in Marbella are classified as non-residents for tax purposes.

They must declare rental income under Impuesto sobre la Renta de No Residentes (IRNR).

Key points:

• Declarations are normally submitted quarterly

• Tax is calculated on rental income generated in Spain

• EU and EEA residents may deduct certain expenses

• Non-EU residents usually cannot deduct expenses

Failing to submit quarterly declarations is one of the most common compliance issues among foreign property owners.

Tax authorities and regional administrations actively monitor rental activity in high-demand areas such as Cabopino, Elviria, Río Real, Nueva Andalucía and San Pedro de Alcántara, especially for properties advertised on major booking platforms.

What Expenses Can Be Deducted?

For EU and EEA residents, certain rental-related costs may be deductible, such as:

• Cleaning and laundry services

• Property management fees

• Maintenance and repairs

• Utilities during rental periods

• Platform commissions

However, deductions must:

• Relate directly to rental activity

• Be supported by valid Spanish or EU invoices

• Follow proportional rules based on rental periods

Incorrect deductions can trigger audits and penalties, which is why professional tax advice is strongly recommended.

Does VAT Apply to Holiday Rentals in Spain?

This is one of the most misunderstood topics among property owners.

VAT on Accommodation

In most standard holiday rentals, VAT does not apply to the accommodation itself if the owner is only providing lodging.

However, VAT may apply if the property offers hotel-style services, such as:

• Daily cleaning

• Catering or meals

• Reception services

In those cases, the rental activity may be classified as hospitality rather than simple accommodation, and VAT registration may be required.

VAT on Booking Platforms

Even when accommodation is VAT-exempt, booking platforms such as Airbnb, Booking.com and VRBO charge VAT on their service fees.

This means:

• Platform commissions always include VAT

• Owners still pay VAT indirectly through platform fees

• These VAT amounts appear on platform invoices

This VAT does not usually affect the owner’s tax declaration directly, but it is part of the real operating cost of the rental business and must be considered when calculating net income.

Local Taxes and Ongoing Property Costs

In addition to income tax, owners must also budget for:

• IBI (local property tax)

• Community of owners fees

• Waste and municipal taxes

• Insurance policies

These costs apply even when the property is not rented and must be included when evaluating annual profitability.

Why Many Owners Overestimate Their Real Net Profit

Many owners focus mainly on:

• Nightly rates

• Summer occupancy

But true profitability depends on:

• Year-round occupancy, not just high season

• Full tax obligations

• Operating and maintenance costs

• Management and compliance services

Without proper financial planning, owners may overestimate returns and under-prepare for quieter periods. This is particularly common among international owners who only consider peak summer income and underestimate year-round costs and Spanish tax obligations.

How Professional Management Supports Tax Compliance

At Pass the Keys Marbella, we work closely with owners and their tax advisors to ensure:

• Accurate tracking of rental income

• Proper booking documentation

• Clear financial records

• Transparent reporting for accountants

While we do not file tax returns on behalf of owners, we provide the structured data needed for accountants and fiscal representatives to work efficiently and correctly.

This significantly reduces:

• Administrative stress

• Risk of mistakes

• Exposure to penalties

Why Reviewing Your Tax Setup Regularly Matters

Tax regulations, platform rules and reporting systems continue to evolve.

Regular reviews help ensure that:

• Declarations remain compliant

• Documentation is up to date

• Profitability calculations remain realistic

Professional management helps owners adapt quickly to regulatory changes without operational disruption.

Contact Pass the Keys Marbella

Not sure if your holiday rental tax setup in Marbella is correct? Whether you already rent your property or are still preparing to list it, our local team can explain how rental income is tracked and what documentation your accountant will need.

👉 Book a free call with our Marbella City Manager here:
https://calendly.com/ana-torrens-passthekeys

We’ll help you understand how professional management supports tax compliance and protects your long-term profitability.

Earn confidently, stay compliant, and let experts handle the complexity.