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Rental income under scrutiny

These days the Spanish tax authorities are focusing on undeclared rental income. This applies to both short and long term rentals.

lettings-spainThose who use the new service to declare their income online “Renta Web,” migth get the following message on their computer screen: “According to the Tax Administration data, you have placed rental ads in various media, including the Internet.”

The note is a reminder that all rental income must be declared in the same way as income from foreign pension or other foreign revenue.

Tax Administration Director Rufino de la Rosa has not explained how the Tax Administration has come across this information. He only sais that the big and popular sites like Idealista or Airbnb are not giving any information to the Tax Administration. Airbnb is also under pressure in Catalonia, where they received a fine of € 30,000 for illegal commercialization of tourist rental of apartments that are not registered in the Catalan tourist register. Besides the Catalan authorities are threatening to completely block the Airbnb web site in Catalonia.

Rufino de la Rosa

Rufino de la Rosa

This is not the first time the Spanish tax authorities are looking for undeclared rental income. They started already in 2012 to check the power consumption in houses that should have been empty, but with abnormally high power consumption.

Almost half (49.03%) of all the apartments in Spain are not declared for hire. Most of these are being let out to a third party, while some are lent free or for a low rent to relatives. But tax evasion is very common, says an official of the tax office. A survey in 2008 showed that 55% of all lettings were undeclared.

Source: El País