EU demands Spain extend 19% tax exemption to non-resident owners

Spain faces EU reasoned opinion over main-home tax exemption

The European Commission escalated its case against Spain in April, issuing a reasoned opinion demanding the country extend its primary-residence capital-gains exemption to non-resident property owners. Spain has two months to amend the law or face referral to the Court of Justice of the European Union.

Under Spain's resident income tax (IRPF), homeowners can exclude capital gains from selling a habitual residence if they reinvest the proceeds into another main home. Non-residents taxed under the Non-Resident Income Tax (IRNR) can't access the same relief. The Commission says that violates free movement of workers and capital under Articles 45 and 63 TFEU, per the April 2026 infringements package.

The reasoned opinion is the second formal step in EU infringement proceedings. Spain already missed an earlier two-month deadline after the Commission's initial letter of formal notice.

Who carries the cost

Non-resident owners selling Spanish property currently pay capital gains at 19% for EU and EEA residents and 24% for non-EU/EEA sellers, with a 3% withholding on the sale price collected by the buyer through Modelo 211. None of them can apply the reinvestment exemption when selling what was effectively their main home in Spain.

The fallout hits several groups directly:

• Cross-border workers and commuters who live mainly in Spain but file as non-residents
• Expats and digital nomads who relocate abroad and then sell their former Spanish residence after losing tax residency
• Inbound expats under the Beckham Law regime, whose primary-residence treatment the Commission has separately questioned
• Non-resident owners of second homes, affected by related imputed-income rules also under EU scrutiny

Tourists and short-term visitors who don't own property aren't touched by the case.

Filing now, refunds later

Sales completed before any rule change still follow current IRNR rules. Non-residents file capital gains on Modelo 210 within four months of the sale, offsetting the 3% withholding already paid.

Sellers in recent tax years should keep complete records of purchase costs, sale expenses and any reinvestment into a new primary home. If Spain amends the law or loses at the CJEU, refund claims for prior years could become possible for those who were denied the exemption.

Read our full Spain guide for the complete picture on property taxes and residency rules or browse more visa updates.