From July 2028: VAT on tourist rentals in Spain, even without the provision of additional services!

Do you own a vacation home in Spain and rent it out to tourists? Then it’s good to know that important changes are coming as of July 1, 2028. From that date, you will be required to pay VAT (IVA in Spanish) on all tourist short-term rentals – even if you do not offer additional services such as cleaning or breakfast.

New European legislation: EU 2025/516

This change stems from a new European directive (EU 2025/516) announced in March 2025. The purpose of the directive is to harmonize the rules for tourist rentals within the EU. Until now, in Spain it was true that you only had to pay VAT if you also offered additional services, such as a reception or cleaning service. So that will change in 2028.

What exactly is changing?

As of 2028, it’s simple: do you rent out your property to tourists for less than 30 nights? Then you must pay VAT, regardless of whether or not you offer additional services. The measure applies only to short-term rentals. Long-term rentals – for example, to students or families for several months – will continue to be exempt from VAT, as they are now.

Why this change?

The European Union wants to create a level playing field for tourist accommodation providers with this new rule. Hotels have been paying VAT for years, while many private landlords still do not. The new law makes that situation fairer. Large booking platforms such as Airbnb and Booking.com are likely to start helping to collect and remit VAT because they facilitate a large portion of bookings.

What does this mean for you as a landlord?

As a landlord, you face additional administrative obligations:

• You have to register for VAT in Spain.
• Your records must meet the requirements of the IRS.
• You must file VAT returns in a timely manner.

It is advisable to prepare for this in good time and, if necessary, hire an accountant or tax advisor.

Possibly in effect before then?

Although the implementation date is officially set for July 1, 2028, it is still possible that Spain may decide to apply the rules earlier. Some political parties are advocating this, hoping it will lead to more available affordable rental housing.

Conclusion:
Do you rent out a vacation home in Spain to tourists? Then it is wise to prepare well for the new VAT obligations. 2028 may seem far away, but the administrative adjustments will take time and preparation. Keep a close eye on the news and seek professional help in time.

Want advice on what this new rental legislation and whether investing in vacation rentals is interesting? Then feel free to contact us and we will be happy to talk you through it.