Letting your Spanish Property to Holidaymakers: Legal and Practical Implications

So you’ve bought your property, furnished it and bought the towels. But before you let it to holidaymakers, there are a number of legal issues you should consider. This brief guide should help you, although we do recommend that you research the subject further or consult a lawyer.

Registration and Local Laws

Most of the Autonomous Communities in Spain have their own laws regarding holiday rental properties, and you should contact the department for tourism in your own community for further information. Some require that holiday rental properties be registered, and issue penalties to owners of unregistered properties.

Contracts

It’s not necessary to have a full signed contract for a holiday rental, but it is advisable to send a full, formal statement of your terms to the prospective guest before you accept the deposit.

This should state:

• Cost, and payment terms (payment methods, deposit required and a date for the final payment)
• Details of what is and is not included in the rent, and costs for any extras (bed linen, towels etc and cots, highchairs.)
• A statement to the effect that the property is to be let for temporary accommodation purposes and not permanent residence.
• Arrival and departure dates and times
• What happens in the case of breakages / damages
• Any other rules you would like to include(eg. no smoking, no pets)
• A statement to the effect that guests are responsible for their own belongings

If the property is to be let for longer than a normal holiday (i.e. more than a month), then you should get a contract and should seek legal advice.

Tax

If you are a resident of Spain, you should claim any rental income on your tax return (IRPF). If you are a non-resident, then you will still need to complete a non-residence tax return every year by the 31st December. This is the case whether you rent out the property or not. All income arising from a property in Spain should be declared in the tax return.

You may also need to declare the income to the UK tax authorities if, for example, it is paid into a UK account. However you can also declare the tax you’ve paid on the income in Spain and you should not be taxed twice.

Insurance

You should not let out your property without insurance which covers the building and its contents, and also provides for accidental damage by the occupiers.

Safety

Finally there are some common-sense safety measures which you should have in place before you rent out your property:

• The property should be checked regularly for potential maintenance problems or hazards
• Exit doors should all be functional
• Swimming pools should be correctly maintained, and all drain covers secure
• Gas appliances and supplies should be checked by a qualified gas engineer regularly