Spanish Fortunes Tax
An explanation of the Spanish Fortunes tax and how it affects expats living in Spain.
Last reviewed/updated 8 November 2024 at 14:44
In 2022, the Spanish government introduced the temporary solidarity tax on Large Fortunes, which is configured as a complementary tax to the Wealth Tax, to tax with an additional rate the assets of individuals, tax residents of Spain, of net assets over 3,000,000 euros.
Constitutional Court confirmed Spanish Fortunes Tax is legal and therefore Spanish Government has approved its indefinite extension (previously, was approved temporary for calendar years 2022 and 2023).
Therefore, taxpayers with net wealth exceeding 3,000,000 euros are obliged to file a declaration for this new tax (since there is a minimum exemption of 700,000 euros, the tax will only start to affect net wealth from 3,700,000 euros).
Fortunes tax has a progressive rate that works as follows:
- 1,7% - Between 3,7 and 6 million euros.
- 1% - Between 6 and 11.3 million euros.
- 5% - Above 11.3 million euros.
The rules for assessing and determining the taxable base are the same as for the Wealth Tax (difference between rights and assets less debts and obligations of the taxpayer).
The same exemptions as in the case of the Wealth Tax Law can also be applied. It should be remembered that there is a minimum exemption of 700,000 euros.
After applying these rules and exemptions, taxpayers whose tax rate, determined in accordance with the regulations of that tax and once the applicable deductions or bonifications have been applied, is to be paid, will be required to file a return.
To avoid potential double taxation, the amount of the Wealth Tax paid at the regional level can be deducted from the amount of the Fortunes Tax.
The deadline for filing Fortunes Tax is between July 1st and July 31st, of the subsequent year, by using Form 718.
Speak to a Spanish tax specialist
If you need assistance with Spanish Fortunes Tax - or any elements of Spanish tax generally - please request a free introduction to one of our trusted Spanish tax partners. As part of our introduction service, you will be offered the chance and a 15-minute discovery call during which some basic questions can be answered and you can determine whether you need formal assistance or not.