Income tax in Spain in 2026: the rates, the allowances and what a resident in Andalucía pays

Spain’s personal income tax, the IRPF (impuesto sobre la renta de las personas físicas), applies to anyone who is tax resident here. The tax has a state half and a regional half, and the regional half differs by community, which is why the answer for Andalucía is not the answer for Madrid or Valencia. This guide gives the 2026 figures for Andalucía, where the Costa del Sol sits. It covers who pays, the two scales and what they add up to, the allowances, how a pension or savings from another country are taxed, a worked example for a retired resident, the filing dates, and the cases where a different regime applies. The figures come from the personal income tax law and Andalucía’s own tax law, Ley 5/2021. None of it is advice on your own position.

Who pays it

You are tax resident in Spain in any calendar year in which you spend more than 183 days here, or in which the main base of your economic interests is in Spain. From that year, Spain taxes your worldwide income, wherever it is paid and whatever currency it is paid in. The day count and the way it interacts with the right to live here are covered in retiring to the Costa del Sol and the 90/180-day rule.

If you are not tax resident, this tax does not apply to you. A non-resident who owns a home in Spain pays non-resident income tax instead, at a flat rate on form 210, which is covered in Modelo 210.

The two scales

Income is split into two bases. General income, which is salary, pensions, rent from property you let, and most other income, is taxed on a progressive scale. Savings income, which is interest, dividends and capital gains, is taxed on a separate and lower scale.

The general scale is two scales added together. The state scale is the same across Spain. The regional scale is set by each community, and Andalucía’s is one of the lowest in the country.

The brackets of the two scales do not line up exactly, which is why the combined column has eight steps rather than six. The rate in each row applies only to the income inside that row, so a resident with €40,000 of taxable income pays 19% on the first €12,450, not 37% on all of it.

The savings scale for 2026 is 19% on the first €6,000, 21% from €6,000 to €50,000, 23% from €50,000 to €200,000, 27% from €200,000 to €300,000 and 30% above €300,000. It is the same across Spain.

The allowances

Spain does not have a tax-free band in the British sense. It has a personal and family minimum, an amount of income the law treats as needed to live on, and the tax due on that amount at the scale rates is taken off your bill. The effect is close to a tax-free band at the lowest rate.

The state personal minimum is €5,550. Andalucía applies a higher minimum of €5,790 for its half of the tax. Over 65 the state minimum rises by €1,150 to €6,700, and the Andalucía minimum by €1,200. Over 75 the state minimum rises by a further €1,400 to €8,100, and the Andalucía minimum by a further €1,460. There are further minimums for dependent children and for disability.

Earned income, which includes pensions, carries two further reliefs. The first is a flat deduction of €2,000 for expenses, which everyone with earned income receives. The second is a reduction for low earnings, which is €7,302 where net earned income is €14,852 or less, falls as income rises, and reaches zero at about €19,750. Above that it does not apply.

Pensions and other income from abroad

A pension paid from another country to a Spanish resident is earned income and goes into the general scale, whether it is a state pension, a company pension or a personal pension. The same applies to a salary paid from abroad.

Pensions for government service are the usual exception. Under most of Spain’s tax treaties, including the one with the United Kingdom, a pension paid for service to the government, the armed forces, the police or a local authority is taxed only by the country that pays it. Spain does not tax it, but it does count it when it sets the rate on your other income, a method called exemption with progression. Pensions from the United States social security system are a disputed case, where the Spanish tax agency and some advisers read the treaty differently, so take advice before you rely on either reading.

Rent from a home you still own in your own country is taxed in Spain as general income, with a credit for the tax you paid on it there. Interest, dividends and gains on investments abroad go into the savings scale, again with a credit for foreign tax up to the Spanish tax on the same income. The credit means you do not pay twice, but it also means that where Spain’s rate is higher than the rate at home, you pay the difference to Spain.

A resident who holds more than €50,000 abroad in any one category, which means bank accounts, investments or property, also files an information return, form 720, by 31 March. It carries no tax but it is compulsory. Wealth tax, which is a separate annual tax on what you own, is covered in wealth tax in Spain and why Andalucía is different.

A worked example

A single resident in Andalucía, aged 66, receives a pension from abroad of €30,000 a year and has no other income.

1. The flat €2,000 deduction takes taxable income to €28,000. At that level the low-earnings reduction is nil.
2. The state scale on €28,000 comes to €3,283 and the Andalucía scale to €3,242, which is €6,525 in total.
3. The personal minimum for someone over 65 is €6,700 on the state side and €6,990 on the Andalucía side. The tax on those amounts at the lowest rate, 9.5% each, is €1,301, and that is taken off.
4. The tax due is about €5,224, which is roughly 17% of the €30,000 pension.

If the same person were under 65 the minimums would be €5,550 and €5,790, and the tax would be about €5,447. Any tax withheld at home on the same pension, where the treaty allows the paying country to tax it, is credited against the Spanish figure. The example leaves out regional deductions, which in Andalucía are modest and mostly for families, rent paid and disability.

When and how you file

The Spanish tax year is the calendar year. The return, form 100, is filed between early April and 30 June of the following year through the tax agency’s website, and most people file it through a gestor or tax adviser for a fee of a few hundred euros. Tax is paid on filing, or in two instalments, 60% in June and 40% in November.

The thresholds below which a resident need not file are €22,000 of earned income from one payer and €15,876 where there is more than one payer. A pension from abroad has no Spanish tax withheld and usually counts as a separate payer, so a resident with a foreign pension should assume they file. In the first year of residence it is worth filing in any case, because the return is the record that establishes your position.

The cases where a different regime applies

Two groups of newcomers are taxed differently. Someone who moves to Spain for work, including under the digital nomad visa, can elect within six months of arriving to be taxed under the special regime for inbound workers, at a flat 24% on employment income up to €600,000 for six years, and on Spanish-source income only. The conditions are in Spain’s digital nomad visa. A retiree with a pension does not qualify, because the regime requires a move for employment.

The other case is the year of the move itself. Someone who arrives in the second half of a year is usually not tax resident until the following year, which means the first Spanish return covers the first full year. The timing matters for the sale of a home in your own country, which is generally better completed while you are still tax resident there, and for drawing a lump sum from a pension. Both are questions for an adviser who handles both countries, asked before you fix the moving date.

How I handle it

I am not a tax adviser and do not act as one. What I do is build the budget for the move with the annual costs in it, including the tax on the income you will live on, so that the figure you work to is real. When the question needs an answer for your own position, I introduce you to an adviser who handles residents with income from abroad, and I stay alongside you while they do their part. If you are planning a move to the Costa del Sol and want to talk through the figures, book a call.

Common questions