Do you have property or assets in Spain as a non-resident? Then there is very good news. The Spanish Supreme Court (Tribunal Supremo) in recent rulings of October and November 2025 the rules on wealth tax changed drastically in favour of non-residents.
These rulings put an end to long-standing tax discrimination and provide opportunities to reclaim past overpaid tax. In this article, we explain what this means for you.
The crux of the ruling: equal treatment
Until recently, a clear distinction was made between residents of Spain (residents) and non-residents (non-residents):
- Residents are taxed on their global assets.
- Non-residents (such as holiday home owners) are only taxed on their assets in Spain.
Although rates were the same, residents had an important advantage: the so-called "joint limit" (límite conjunto). The Supreme Court has now ruled that excluding non-residents from this benefit violates the free movement of capital within the EU. The court argues that residents and non-residents are in a similar situation as regards the purpose of this tax.
What is the 'Joint Limit' (Límite Conjunto)?
Spanish legislation contains a protection mechanism to prevent taxes from becoming confiscatory (expropriatory).
- The 60% rule: The sum of your income tax (IRPF) and wealth tax (IP) cannot exceed 60% of your taxable income.
- The corollary: If you are above this 60%, the wealth tax payable may be reduced until you are below this percentage again (with a maximum reduction of 80% of wealth tax).
Read more about wealth tax in Spain.
So how does this work for non-residents?
Previously, non-residents could not avail of this reduction. Thanks to the Supreme Court's new doctrine, you may now take the tax you pay in your own country of residence (e.g. in the Netherlands or Belgium) into the calculation to determine whether you are entitled to this discount.
Important: This applies not only to EU residents, but also to third-country (non-EU) residents, as the ruling is based on the free movement of capital.
Does this also apply to the 'solidarity tax'?
Yes. Since 2022, the "Temporary Solidarity Tax on Large Wealth" (Impuesto sobre las Grandes Fortunas). The limit regime for this tax is identical to that of the regular wealth tax.
Thus, the new case law means that non-residents can also rely on the aggregate limit for this tax to reduce their tax burden.
Can you claim money back?
The ruling has implications not only for the future, but also for the past.
- Unexpired years: You can request rectification for tax returns that are not yet time-barred. This generally concerns the years from 2021.
- Taking action: If you filed your wealth tax return under the old rules, this opens the door to apply for a refund of undue income (ingresos indebidos).
The Supreme Court stresses that the Spanish tax authorities have sufficient resources to exchange information with other countries to verify your data, so administrative complexity is no longer an excuse to refuse the refund.
The judgments
Summary
Spanish Supreme Court rulings of 29 October and 3 November 2025 mark an important turning point. Non-residents can now reduce their tax burden in Spain by taking into account the taxes they pay in their home country.
Key points at a glance:
- The 'ceiling rule' (max 60% of income) now also applies to non-residents.
- This applies to both Wealth Tax (IP) and Solidarity Tax on Large Wealth.
- You can reclaim overpaid tax retrospectively (for non-due years).
PS A Belgian resident initiated proceedings to obtain this result at the Supreme Court of the Balearic Islands (Superior Court of Justice of the Balearic Islands).
