New rules regarding vacation and holiday rentals

From July 2018 it is necessary for rental platforms like Airbnb AND agencies to take in use the new “Modelo”, and it is YOUR responsibility everything is declared. 

Make sure your property manager has everything in order, if not, the fines will be high!

We can help you with all you need to know regarding this, so dont worry. 

 

New rules on holiday rental

The new rules consist basically of that entities like Airbnb, other platforms and/or persons who provide a service between owner/tenant, must report its activity in a new form. This form now consists of information like:

  • Owner
  • Cadastral reference
  • Dates the property is rented out
  • Income

This means that all of your rental income now needs to be declared every quarter. Of course, in theory you should have been doing this from before, but if you didnt, this is the tax authorities newest solution to get a step closer to having some control over the vacation rentals in Spain.

 

When?

The new rules will be effectuated in July 2018, but still, all of 2018 must be declared within the year.

 

Now what?

There are a couple of things that needs to be in order. From before there is different regulations that needs to be followed.

  • All properties rented out for vacational purposes must have a license number issued by GVA
  • Contracts between owners and agencies/agents needs to be in place, to state that the entity are allowed to operate on behalf of the owner
  • Documentation of the tenants needs to be provided if Guardia Civil come knocking on the door. ID documents is to be submitted to Guardia Civil before arrival of the tenants

All of these elements must be in place, in addition to the Modelo the entities now need to provide. This again needs to reflect the other declarations of the entity and your declaration each quarter.

Be sure that your property manager have all these things under control, and ask them to see the procedures. They should provide you with all the information and handle all this for you. They should also provide you with the documentation you need for your declaration. If they don´t follow these rules and/or doesnt take it seriously you should maybe start using someone who doesnt operate illegal.

 

Will I still be able to make money?

Yes! The taxes for non-residents from EU, Norway, Iceland when renting out a holiday home in Spain is 19%. From this you can deduct, among other things, costs for property managers, a percentage of the utility costs based on amount of rented dates, and also a general deduction of 3% of the property value. For more information about tax-rules for Norwegians – read here.

The reason you will stilll earn money is that rental prices are based on the demand and supply. The supply will decrease, and then the prices will go up. The decrease will be a result from alot of agencies not following the new rules. For these, eventually, their system will fail. For too long companies and private entities have been doing as they want themselves, without any consideration of the laws and local regulations. In the end of the day, you are the one paying for it when they get caught.

This is not just to scare you, but its reality. And it is close, because more and more often you hear or can read about people who have had the Guardia Civil knocking on their doors, asking if they are the owners. If they arent, its going to be a problem…

 

It cant be stressed enough, MAKE SURE YOUR PROPERTY MANAGER HANDLES THIS FOR YOU TODAY! If you still feel unsure, want advice or any kind of help regarding this, dont hesitate to contact us. We will have everything sorted out for you quick and easy, so you never need to worry about if you are doing it right or wrong.

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