Your Spanish home and UK tax
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The UK taxes your Spanish rent and gives credit for the Spanish tax. A home you only use yourself is not taxed in the UK.
Spain may tax your home because it is in Spain. You file the Modelo 210 there every year. Your own country then makes sure you are not taxed twice on the same income.
If you rent the home out
- UK residents pay UK tax on Spanish rent, even if the money stays in Spain.
- Foreign Tax Credit Relief lets you deduct the Spanish tax, up to the UK tax on the same rent.
- Spain charges UK residents 24% on the gross rent, so part of the Spanish tax can go unused.
If you keep the home for yourself
- No UK income tax on a home you only use yourself.
Tax on what you own
- Selling it? UK Capital Gains Tax applies, with credit for the Spanish tax on the gain.
What this means for you
Declare the rent on the Self Assessment foreign pages (SA106) and claim Foreign Tax Credit Relief there.
Sources
General information, not tax advice. Your situation may be different. For tax where you live, ask an adviser in your own country.