Legal content last updated: 1 October 2026
Purchase taxes: ITP or IGIC + AJD
The Canary Islands sit outside Spanish VAT, so a new build attracts IGIC at 7% rather than 10% IVA, plus AJD stamp duty at 0.75%. A resale attracts ITP transfer tax at 6.5% of the declared price — and the tax office can revalue upward if the price looks low against its reference value.
- Resale — ITP 6.5%, paid within 30 working days of the deed.
- New build — IGIC 7% paid to the developer, AJD 0.75% filed separately.
- Plusvalía municipal — town hall land-value tax, legally the seller's.
Annual obligations as a non-resident owner
- Modelo 210 — imputed income tax on an empty second home, 19% for EU/EEA residents and 24% for others, applied to 1.1–2% of the catastral value.
- Rental income — quarterly Modelo 210 filings; EU/EEA residents may deduct expenses, UK residents since Brexit generally may not.
- IBI and rubbish — annual town hall charges, best paid by direct debit.
- Community fees — plus any extraordinary levy voted by the community.
Selling as a non-resident: the 3% retention
The buyer withholds 3% of the price and pays it to the Agencia Tributaria against your capital gains liability. If your actual gain produces less tax, you reclaim the difference with Modelo 210 — a refund that routinely takes 12 months and is frequently never claimed.
Capital gains tax when you sell
Non-residents are taxed at a flat 19% on the gain. The gain is the sale price minus the purchase price, with deductions for the original purchase taxes, notary and registry costs, documented improvements and the costs of selling. Keeping your purchase invoices is the simplest way to pay less tax on exit.
UK owners after Brexit
UK residents are now treated as non-EU taxpayers: 24% rather than 19% on imputed and rental income, and generally no deduction of letting expenses. Spain and the UK have a double taxation agreement, so Spanish tax paid is normally credited against UK tax on the same income — it is reported in both countries, but not paid twice.
Inheritance and gifts
Spanish inheritance tax is assessed on Spanish property whatever the owner's residence. The Canary Islands offer some of the most generous reliefs in Spain for close family, but the heirs still have to file and pay any balance within six months of death. A Spanish will, coordinated with the will in your home country, makes that process far quicker.
Worked example: €350,000 resale
- ITP at 6.5% — €22,750
- Notary and Land Registry — around €2,300
- Gestoría and admin — around €350
- Legal fees at 1% plus IGIC — €3,745
- Total on top of the price — roughly €29,000
Before relying on any figure, check the property itself with our property due diligence checklist: hidden debts and unlicensed works change the real cost far more than the tax rate.
Run your own figures below, then read the full guide to buying property in Tenerife or how conveyancing in Spain works.