Understanding Spain's proposed 100% property tax for non-EU buyers: Implications for UK nationals

Spain's housing market is undergoing significant changes, especially concerning property purchases by non-European Union (EU) citizens. If you're a UK national eyeing a Spanish home, it's essential to understand these developments and their potential impact on your investment plans.​

What's happening?

In January 2025, Spanish Prime Minister Pedro Sánchez proposed a substantial tax increase on property purchases by non-EU citizens. This proposal suggests imposing a tax of up to 100% on real estate acquisitions made by non-resident, non-EU foreigners, which includes UK nationals post-Brexit.

Why this proposal?

Spain is grappling with a housing affordability crisis, particularly in urban areas like Madrid and Barcelona. Rising property prices and rents have made housing less accessible for residents.  The government attributes part of this issue to foreign investment driving up property values, especially in popular tourist destinations.  By introducing this tax, the aim is to prioritise housing access for residents and curb speculative property purchases by non-residents.

How might this affect UK buyers?

If this tax is implemented, non-EU buyers, including UK nationals, could face a tax equal to the property's purchase price. For instance, purchasing a €300,000 property might incur an additional €300,000 in taxes, effectively doubling the cost. 

This substantial increase could deter many from investing in Spanish real estate.

Current Status of the Proposal

As of now, this tax is a proposal and has not been enacted into law. It requires parliamentary approval, and its specifics are still under discussion. Therefore, while it's crucial to stay informed, there's no immediate change to the property purchasing process for non-EU buyers. ​

What Should Prospective Buyers Do?

1. Stay informed: Keep abreast of updates regarding this proposal. Legislative processes can be lengthy, and the proposal's details may evolve.​

2. Consult professionals: Engage with legal and financial advisors experienced in Spanish property law to understand potential implications for your specific situation.​

3. Consider timing: If you're contemplating a property purchase in Spain, you might want to expedite your plans before any new tax measures are implemented.​

4. Explore alternatives: Given the potential increase in costs, exploring property investment opportunities in other countries with favorable conditions for foreign buyers might be prudent.
   

Conclusion

While Spain's proposed 100% property tax for non-EU buyers aims to address housing affordability, it presents significant considerations for UK nationals interested in Spanish real estate. Staying informed and seeking professional guidance are essential steps to navigate these potential changes effectively.​

Further Reading

• Spain proposes 100% tax on homes bought by non-EU residents 

• Spain's Proposed 100% Tax on Non-EU Property Buyers 

• Spain's 100% Property Tax: What It Means for UK Buyers in 2025 

Note: This information is based on the latest available data as of March 14, 2025. Legislative developments may have occurred since then.