In other words, the net return is the result of deducting from the income obtained by the rent, all the expenses according to the Personal Income Tax Law, provided that they are related to the property (repair and maintenance costs, taxes such as IBI and rubbish, insurance, professional rental services, and even electricity and water if they are at the owner’s expense).Can all landlords enjoy the reduction in income tax for rent?
The answer is no. Not all landlords have the right to apply the reduction. In order to benefit from this reduction, it is necessary that the rented property is used as the dwelling of the person renting (tenant). In other words, if the property is rented by a company, as an office or as a business, the landlord could not apply the reduction in their annual tax return.In addition, it is necessary that the income obtained is taxed as income from the real estate capital and not as an economic activity. In order to consider it as an economic activity, there must be at least one person employed under a full-time employment contract.So, is it profitable to buy for rent in Spain?
Definitely yes! The rental housing market is constantly booming, with prices increasing every year and rates of return close to 10% for holiday rentals. In addition, the access to the finance to buy a home is quite easy and inexpensive, with fixed rate mortgages below 3% .So, if you want to buy a property to rent in Spain, in addition to knowing that it is a profitable business, you also know that you can enjoy a 60% reduction in your income tax.
IRPF reduction if you are renting your property in Spain
If you have your own property in Spain and you are renting it, find out here how to pay less on your annual tax return. According to the tax authorities, the reduction for renting in the Personal Income Tax Law is 60%. It is calculated on the positive net return obtained for renting a property.
As an owner, what are the taxes on the rental incomes ?
The tax on rental income in Spain for residents of EU/EEA countries is 19%. Additionally, they can deduct expenses inherent to renting. These include expenses for maintaining and repairing of the rental property, household insurance premiums, third party service providers, community fees, etc
As an owner, what are the legal obligations to rent my property ?
Everything depends if your flat is rented for holidays or not. If you want to advert your flat to rent i as an holiday rental, you have to ask for a turistic licence that we help you to get bringing the “Nota or Copia Simple”, your IDs and signing a collaboration agreement. As a turistic rental, your flat needs to provide the air conditionning and turistic documentation to the tenants (only online during the Covid).
Do you work in exclusivity to offer my flat or villa ?
Absolutly not. None of our client is forced to work with us. But in the facts, we are the only ones who offer the properties you will find in this website. We only work with owners who considerate our work and our tenants, who are available in case of problems. We only offer flats offering good qualities, linen, matrices, clean and healthy.
What are the guarantees you are asking to rent a property
As our job is to protect the interest of the owners as the tenants, we ask for guarantees to every single tenant. It can be to present payslips, or to be able to pay your stay in advance. A deposit will be asked to be able to enter into the property. We also need to receive a picture of the passport of all the tenants who are staying into the flat.
What is your security deposit policy?
Security deposit equals to one month rent and may vary based on credit. You need to pay the full amount before moving in. The deposit are given back the day of the check out, once our team checked that the flat is in perfect condition. It will be deduced from the deposit the hours of cleaning and, in case of a monthly rent, an estimation of the pending bills of water, gas, or electricity
What are the risk as an owner to rent my flat with your company ?
As the rent can be considered as a Long Term after three months rent, we work only rentals for three months maximum. Most of our tenants are retired people coming to spend the automn and the winter in the Costa del Sol, people working remotly and coming from all around Europe (mostly northen Europe). We ask for guarantees as payslips, payments in advance. And, the most important, our position on Google, our flat located on the main street of Estepona, allow us to hire your tenants from an important demand.
When do you increase the rent?
For the long term rentals, we are allowed to increase the rent after a year, and we calculate it on the spanish IPC, which regulates the inflation allowed on the rents. For the short term rentals, the negotatiate with the owners and offer only flats who matches the market
As a tenant, can I decorate or make changes to the property?
In most cases, a tenant can only decorate or make changes to the property with the express permission of the landlord. We recommend receiving this permission in writing.
What’s the pet policy?
The pet policy depends on the terms in each specific lease agreement. You must notify our team of any pets before move-in. When you already have a pet and you want to add an extra one, please call our office first. We will process every request separately depending on the lease terms. Everything depends on the residence rules, on the owners (few are allergics), and we take our decision to respect the neighbourhood as the owners.
What if I accidentally cause damage to the property?
Don’t worry – accidents happen. Tell whoever is responsible for the property maintenance as soon as possible. You will be expected to cover the cost of putting it right. Don’t try to ignore or hide damage because it could get worse, and it will only come out of your deposit at the end of the tenancy. We work with trustable maintenance companies based in Estepona, Manilva and Casares
