Retiring in Spain
Spain: the tax picture for FIRE
Spain taxes general income on a progressive scale, from 19% to a top rate of 47% above €300,000, after a personal minimum of €5,550. Ember models that minimum as a tax-free allowance; in reality it is a tax-reducing credit, so results are slightly approximate. Investment gains are modelled at a progressive 19–28% with no annual exemption, approximating Spain's savings-income schedule, which itself runs to 30%. At death Spain applies a recipient-side inheritance tax by relationship group, with no unlimited spouse exemption at state level; the 17 autonomous communities add reliefs of up to 99%, so resident spouses and children often pay far less than the state scale suggests.
Under the UK–Spain treaty, UK private, occupational and State Pensions are taxed only in Spain for residents; government-service pensions stay UK-taxed. Cost of living is modelled at a relative factor of 0.72, a low-confidence, illustrative figure. Coverage limits: regional income-tax variation (Madrid lower, Catalonia and Valencia higher) and the Beckham regime are not modelled, rates are confirmed 2025 figures pending 2026 updates, and the capital-gains and inheritance estimates carry low confidence.
Income tax (2026)medium confidence
| Band | Rate |
|---|---|
| €0 – €12,450 | 19% |
| €12,450 – €20,200 | 24% |
| €20,200 – €35,200 | 30% |
| €35,200 – €60,000 | 37% |
| €60,000 – €300,000 | 45% |
| above €300,000 | 47% |
What this model doesn’t capture (11)
- mínimo personal (€5,550) modelled as a tax credit at 19% (scale(base)−scale(5,550) mechanic) — matches Spain's method; the over-65/over-75 increments ride the ageRebate module at the same 19% valuation; regional (autonómico) mínimo variation is still not modelled
- work-income reductions not modelled — the €2,000 'otros gastos' (Art. 19.2.f LIRPF, available to all recipients of rendimientos del trabajo, pensions included) and the Art. 20 reducción por obtención de rendimientos del trabajo (€7,302 where net work income ≤ €14,852, tapering 7,302 − 1.75 × (RNT − 14,852) to €17,673.52 then 2,364.34 − 1.14 × (RNT − 17,673.52) to nil at €19,747.50, and only where other non-exempt income ≤ €6,500) are both absent: salary and pension income is taxed here on the full gross, so ES tax is OVER-stated for lower-income residents — by roughly the €2,000 deduction's value for any pensioner, and by materially more for a filer whose non-work income stays under €6,500
- autonomous-community scale variation not modelled (single combined default scale; Madrid lower, Catalonia/Valencia higher)
- interest income is not a separate category — dividends run on the statutory savings scale (dividendTax: 19/21/23/27/30 at €6,000/€50,000/€200,000/€300,000) and capital gains on the same scale via the CGT table, but interest has no category of its own and joins the ordinary general-scale stack, which over-states it above the 19% band and under-states it below
- Beckham regime (flat 24% to €600k for qualifying new arrivals) not modelled
- IRNR non-resident rental modelled as flat 24% gross / 19% EU-EEA net (nonResidentRental module) — renta imputada on non-let periods (Art. 24.5), the Art. 46 IRPF-option election, and the pending TS appeal on non-EU expense deductibility are not; the EU-net base reuses the vacancy+maintenance haircut as a coarse expense proxy
- 2026 reconciliation DONE (2026-07-19, AEAT/BOE primary sources): general state scale (9.5/12/15/18.5/22.5/24.5 halves), mínimo personal €5,550, IRNR 24%/19% and the Patrimonio+ITSGF stack all VERIFIED-unchanged under the PGE-2025 prórroga; the savings scale was corrected to 27% (€200k–300k) / 30% (>€300k) per Ley 7/2024. RD-ley 5/2026 (17 Feb, BOE 19-2-2026, art. 28) adds a low-income work deduction (€590.89 up to €17,094, tapering to nil at €20,048.45) — not modelled, like the €2,000 otros gastos it sits beside (RD-ley 5/2026 art. 28 / DA 61ª LIRPF is cited from the reconciliation note only; no BOE identifier has been verified in-pack, and the deduction is restricted to income from a relación laboral o estatutaria so it does not reach pensioners)
- tributación conjunta (joint filing) not modelled — a joint declaration reduces the base by €3,400 (two-parent) / €2,150 (single-parent) per year (Arts. 82–84 LIRPF, unchanged 2026); jointFiling is only modelled for DE/FR/US
- autónomo cuota approximated as a capped banded charge fitted to the DEFAULT tramo-minimum base (Orden PJC/297/2026 art. 18; 31.50% = 28.30 contingencias comunes + 1.30 profesionales + 0.90 cese de actividad + 0.10 formación profesional + 0.90 MEI — of which art. 18 itemises the comunes, profesionales and MEI legs verbatim, 30.50 of that aggregate; cese de actividad and formación profesional, 1.00 percentage point between them, are taken from practitioner readings of the same Orden, corroborated by art. 18.9 exempting religious-institute members from contributing for exactly those two), banded on rendimientos netos COMPUTABLES rather than on profit (art. 308.1.c LGSS regla 2.ª: an uncapped 7% generic-expense deduction ⇒ computable = profit × 0.93), with the reduced table's €2,470.57/yr tramo-1 cuota applied as a floor, so the modelled charge runs from €2,470.57 to €7,289.93/yr as the statute bounds the default election — €7,289.93 is the FIT's ceiling, not the statute's: €1,928.10 × 31.50% × 12 = €7,288.22/yr, so every profit at or above €77,419.37 is OVER-charged by €1.71/yr, an artefact of the 4-dp band rates. Residual approximations, all disclosed: (a) the real charge is a quota on a base the contributor CHOOSES inside their tramo (minimums €653.59–€1,928.10/mo, maximum €5,101.20/mo), so anyone electing above the tramo minimum pays MORE than modelled — up to €19,282.54/yr, a ceiling the pack does not represent; (b) the fit is piecewise-LINEAR between tramo entry points while the statutory cuota is CONSTANT inside each tramo, so it lands within +€0.60–€1.71 of statute at each anchored tramo entry (the 4-dp band rates leave it fractionally ABOVE, not exact) and OVER-states increasingly toward each tramo's top — worst +19.1% at ≈€21,935 profit where general tramos 1–3 share near-identical minimum bases (statute €3,631.75, modelled €4,324.22); the error is a RAMP inside each tramo, not a level, so the €52,258–€77,419 tramo-11 window below the ceiling runs +0.02% at its entry, +3.5% at €60,000 and +11.3% only at its top; (c) the fit's under-statute residuals, re-measured 2026-08-07 by a 1-cent sweep of the shipped engine against the statutory step: the model sits BELOW statute in FOUR profit windows — €8,645.17–€11,379.19 (worst −€247.06 / −9.1% at €8,645.17, where the reduced table steps up to its tramo 2 while the floor is still binding), €11,612.91–€13,448.16 (worst −€438.31 / −13.6% at €11,612.91, the global worst), €23,870.98–€24,429.94 (worst −€55.21 / −1.2%) and €26,193.56–€26,931.41 (worst −€72.88 / −1.5%) — and is at or above statute everywhere else, including between the first two windows; (d) the floor assumes the REDUCED-table election, available only where declared expected net earnings are below €1,166.70/mo (subject to regularización) — a low-profit autónomo left on the general table pays that table's tramo-1 minimum, €3,594.70/yr, €1,124.13 more; (e) tarifa plana (€80/mo for new autónomos in their first 12–24 months) is not modelled, so a first/second-year autónomo is OVER-stated by up to €1,510.57/yr; (f) autónomos societarios get a 3% deduction, not 7% (computable = profit × 0.97, i.e. a higher tramo at the same profit) — Ember has no company-director axis on business income and assumes 7% universally; (g) the cuota attaches to RETA MEMBERSHIP, not to profit, but Ember drives it off annual profit, so a dormant or loss-making autónomo models €0 where the statute still charges the floor; (h) the cuota is a deductible expense of the activity under Art. 30 LIRPF and this pack does NOT net it off the income-tax base, so ES sole-trader income tax is separately OVER-stated (≈€469 at €10,000 of profit rising to ≈€3,280 at €80,000) — tracked as its own cross-cutting engine item, not a defect of this module
- reduced corporate rates not modelled — corporationTax charges the flat 25% general rate for every ES company. Ley 7/2024 (DT 44ª LIS) phases lower rates the pack cannot apply because it has no turnover axis: microempresas (cifra de negocios < €1M) pay 19% on the first €50,000 and 21% on the remainder in 2026 (21%/22% in 2025, 25% from 2027); entidades de reducida dimensión (< €10M) pay 23% in 2026, stepping 22%/21% in 2027–28 and 25% from 2029. ES company profits are therefore OVER-taxed for both tiers — re-verify against DT 44ª before roadmap item #11 (corp-tax relief on company pension contributions) consumes this module
- wealth tax: regional variation not modelled — the state Art. 30 scale is wired; Madrid/Andalucía 100% bonificación (≈zero IP below ~€3M net wealth), Cataluña/Valenciana/Balears exemption variants, the €300,000 habitual-residence exemption and the pension-rights exemption are all unrepresented (overstates the €700k–€3M window for bonificación regions; the ISGF floor above €3M applies nationally either way)
Capital gainsmedium confidence
Capital gains are taxed at 19%–30%.
19–30% progressive savings base (base del ahorro): 19% to €6k / 21% to €50k / 23% to €200k / 27% to €300k / 30% over €300k. Nationwide (regions cannot alter). Top rate rose 28%→30% for FY2025.
Inheritance & estate taxlow confidence — approximate
Tax is charged on each recipient, scaled by their relationship to the deceased.
Recipient-side ISD by relationship group (I–IV). NO unlimited spouse exemption at state level — the spouse (Group II) gets only the €15,956.87 reduction, so spouseExempt=false. A PARENT of the deceased sits in that same Grupo II (Art. 20.2.a 'ascendientes') — identical €15,956.87 reduction and identical Art. 21.2 scale as a spouse or an adult child, and identical Art. 22 coefficient banding; Spain gives ascendants no separate group. CRITICAL unmodelled feature: after the scale the cuota is multiplied by an Art. 22 pre-existing-wealth/relationship coefficient (Groups I–II 1.0–1.2; Group III 1.5882–1.9059; Group IV 2.0–2.4), so sibling/unrelated liability is up to ~2.4× the band figures — not representable here. Spain is intensely regional: the 17 autonomous communities apply bonificaciones up to 99% for Groups I–II, so resident close relatives often pay near zero. This pack encodes ONLY the state default scale + reductions.
When should you claim your Spain state pension?medium confidence
Spain state pension (Seguridad Social)
Normal pension age 67. Deferring adds about 4% for each year you wait (no cap). You can't claim before the normal age.
Modelled defer-only: the demora (deferral) bonus is ≈+4% per full year. Early-retirement reduction coefficients depend on contribution history and are simplified out — confidence low.
The best age to claim isn’t just about these factors — it depends on your life expectancy, your other income, and which country you’re tax-resident in when the money lands. Deferring into a lower-tax country can flip the answer entirely. Optimise your claim age →
Cost of living
72%
of a UK baseline (100%) — a rough, illustrative comparison, not a forecast.
UK private pension
Under the UK treaty, a UK-sourced private pension paid to a resident here is generally taxed only where you live (not by the UK).
Common questions
How are capital gains taxed in Spain?
Ember models capital gains under Spain's savings-income schedule at a progressive 19% rising to 28%, with no annual exemption. This estimate carries low confidence, and in the income-tax model dividends and interest currently fall on the general scale rather than the separate savings schedule — an approximation that matters most when investment income is a large part of a plan.
Will my UK pension be taxed in Spain?
Under the UK–Spain treaty, a UK private or occupational pension — and the UK State Pension — is taxed only in Spain once you are resident there. The exception is UK government-service or military pensions, which by default remain taxed in the UK.
Is there inheritance tax in Spain?
Yes — Spain taxes the recipient, not the estate, by relationship group, and there is no unlimited spouse exemption at state level: a spouse gets only a reduction of about €15,957. In practice the 17 autonomous communities apply reliefs of up to 99% for spouses and children, so resident close relatives often pay near zero. Ember encodes only the state default scale and reductions, and a pre-existing-wealth multiplier that can raise sibling or unrelated-heir bills up to roughly 2.4× the scale figure is not modelled, so the estimate carries low confidence.
What does Spain do to your FIRE date?
The free calculator compares your number across every covered country; the full planner models your actual accounts, pensions, residency moves and these exact tax rules — with the maths behind every figure shown.