Spain continues to attract international investors, remote professionals, and individuals seeking a high quality of life. However, becoming a tax resident also means taking on new fiscal obligations — particularly with regard to your worldwide investments.
This guide explains how investment income is taxed in Spain for fiscal residents and outlines key strategies to optimise your tax position under current regulations.
Who Qualifies as a Spanish Tax Resident?
Anyone who spends more than 183 days a year in Spain or whose primary economic interests are based there is generally considered a tax resident. This status subjects you to taxation on your global income — not just income generated within Spain.
How Investment Income Is Taxed in Spain (2025 Update)
Investment income is taxed under Spain’s savings tax base, which includes returns from capital (such as dividends or interest) and capital gains (such as profits from the sale of shares, funds, or crypto assets).
Current 2025 savings tax rates are:
- 19% for income up to €6,000
- 21% from €6,001 to €50,000
- 23% from €50,001 to €200,000
- 27% from €200,001 to €300,000
- 30% on income above €300,000
How Different Investments Are Taxed
Here’s how common financial assets are treated for tax purposes in Spain:
- Bank accounts and deposits: Interest is taxed with a 19% withholding.
- Treasury bills: Same treatment as bank interest.
- Shares: Gains are taxed when sold.
- Dividends: Taxed as income; international dividends may benefit from tax treaties.
- Investment funds: Tax deferred until funds are redeemed; domestic transfers are exempt.
- ETFs: Taxed like stocks, without deferral benefits.
- Pension plans and insured pension products: Contributions are deductible up to €1,500 annually; withdrawals taxed as earned income.
- Unit Linked policies: Can offer tax deferral if structured appropriately.
- Cryptocurrencies and forex: Taxed on sale as capital gains.
- Crowdfunding returns: Taxed as interest income.
Ways to Optimise Your Investment Taxes
To manage your tax liability effectively in Spain, consider the following:
- Choose investment products with tax deferral features.
- Offset capital gains with capital losses on your tax return.
- Plan the timing of pension withdrawals to avoid higher tax brackets.
- Use available deductions tied to the type and origin of income.
- Apply relevant double tax treaties for foreign income sources.
Special Tax Options for Foreign Residents
Spain has introduced flexible tax options designed to attract skilled professionals and investors from abroad:
1. Beckham Law (Special Regime for Inbound Workers)
Available to those relocating for professional reasons, this regime allows taxation only on Spanish-source income for up to six years, often at a flat rate.
2. Regional incentives (e.g. “Mbappé Regime” in Madrid)
Some regions apply favourable deductions on certain investment income to promote foreign investment. These benefits vary and should be reviewed case by case.
Conclusion: Plan Ahead for Tax Efficiency
Understanding how your investments are taxed in Spain is critical to protecting your capital and making informed decisions. With the right planning, it’s possible to reduce your tax burden while ensuring compliance with Spanish regulations.
