Jonas Weber is an engineer in Munich. In 2014 he bought a flat in Teatinos, in Málaga, for 180,000 €, with a further 16,000 € of tax, notary and land registry fees. From 2017 to 2025 he let it to students and to a young couple, and he filed his non-resident returns for that rent punctually. He never deducted depreciation: he did not know he could. In 2026 he is selling it for 245,000 €. When he is told that his purchase value is no longer 196,000 € but quite a lot less, his reaction is almost everyone's: if I never deducted it, why are they taking it off?
The rule, in two articles
Article 35.1 of the IRPF Law (Spanish personal income tax), which applies to non-residents through the reference in article 24.4 of the IRNR Law (the law on non-resident income tax), says that the acquisition value "shall be reduced by the amount of the depreciation". Article 40.1 of the IRPF Regulations sets out how: "in all cases the minimum depreciation" is counted, "regardless of whether it was actually treated as an expense".
There is no exception for someone who did not deduct it. The rule starts from the premise that a property that is let loses value, and that wear is charged to the sale calculation whether or not it was used as an expense at the time. What does change is the amount: if someone deducted more than the minimum, what they deducted is subtracted; if they deducted less or nothing, the minimum is subtracted.
How the minimum is calculated
The percentage comes from article 14.2.a of the IRPF Regulations: 3 % a year "on the greater of the following values: the acquisition cost paid or the valor catastral, excluding the value of the land". The valor catastral is the official value the land registry authority (the Catastro) gives each property. Land is not depreciated, and to separate it out you use the proportion shown on the IBI bill (the annual municipal property tax). The guide on the land value on the IBI bill explains where to find that figure.
In Jonas's case, the total valor catastral is 90,000 €, of which 36,000 corresponds to the land: 40 %. The building is therefore 60 %.
- Acquisition cost with expenses: 196,000 €.
- Building share: 60 % of 196,000 = 117,600 €.
- Valor catastral of the building: 54,000 €. The greater figure, 117,600 €, is taken.
- Annual minimum depreciation: 3 % of 117,600 = 3,528 €.
- Years let: from 2017 to 2025, nine full years.
- Accumulated depreciation: 3,528 × 9 = 31,752 €.
- Reduced acquisition value: 196,000 − 31,752 = 164,248 €.
The effect on the tax
| Item | Without depreciation | With depreciation |
|---|---|---|
| Transfer value (245,000 − 7,350 agency − 1,000 plusvalía) | 236,650 € | 236,650 € |
| Acquisition value | 196,000 € | 164,248 € |
| Gain | 40,650 € | 72,402 € |
| Tax at 19 % | 7,723.50 € | 13,756.38 € |
| Buyer's withholding (3 %) | 7,350 € | 7,350 € |
| Result | Pay 373.50 € | Pay 6,406.38 € |
The plusvalía in the table is the plusvalía municipal, the municipal tax on the increase in land value. Depreciation costs Jonas a little over 6,000 € in tax. It is neither a penalty nor a mistake: it is the rule. What is a common mistake is not applying it and filing a Modelo 210 (the non-resident's tax return) with the gain in the left-hand column. In a tax check, the authorities recalculate with depreciation and assess the difference with interest.
What Jonas lost at the time
There is a part of the story that hurts more than the calculation. Jonas lives in Germany, a Member State of the European Union, and so, under article 24.6 of the IRNR Law, he could deduct from his rent the expenses provided for in the IRPF Law, depreciation included. Had he done so, each year he would have been taxed on 3,528 € less income. Nine years of that unused saving are now added to the gain on the sale.
That money can be partly recovered, but only for the years that are not time-barred. The rental returns for the last four years can be corrected to include depreciation and to claim back what was overpaid. The earlier ones cannot. It is a decision worth studying at the same time as the sale, because the figures interact.
Non-residents from outside the European Union and the European Economic Area are taxed on rent on the gross income, with no expenses deducted (article 24.1 of the IRNR Law). The text of the IRPF Regulations counts the minimum depreciation "regardless of whether it was actually treated as an expense", and there are arguments for holding that it should not be subtracted for someone the law prevented from deducting it. It is an open question: we cannot promise how the office reviewing your return will resolve it, and the risk should be weighed before leaving it out.
Which years count and which do not
Only the periods in which the flat was let are depreciated. Had Jonas left it empty for six months between two tenants, those months would not count. If in a given year he let it by the day, that year's depreciation is apportioned by the days let. Holiday letting counts just like long-term letting.
This means rebuilding the rental history in some detail. The non-resident returns filed each year are the best evidence of which periods were let and which were not. If there are years that were never declared, depreciation is counted all the same, and on top of that there is a regularisation pending.
Improvements are depreciated too
If improvements were made during the years of letting, their cost adds to the purchase value, but it is also depreciated from the moment the work is done. A 20,000 € renovation carried out in 2020 on a flat let until 2025 adds 20,000 € and then subtracts the depreciation for those years. The net result is still favourable, but smaller than it looks at first sight. The line between improvement and repair is drawn in I renovated the flat: does that add to the purchase value?.
If you send us the deeds, the IBI bill and the rental returns through the property sale form, we will rebuild the calculation year by year.
If the property sold was inherited
When the flat was inherited and then let, the depreciation base is no longer the purchase price but the value at which it was acquired on inheritance plus its costs, always without the land. The logic is the same and so is the adjustment, but it starts from a different figure. We deal with it in I am selling a flat I inherited.
The guide the depreciation that is subtracted even if you never deducted it develops the mechanism with more examples, including the case of someone who deducted more than the minimum.
Where this leaves the seller
For Jonas, the practical conclusion is that the 3 % withholding does not cover his tax: he will have to pay the difference when he files the Modelo 210. Knowing this before signing lets him set the money aside and consider whether it is worth reviewing the rental returns that are not yet time-barred. For someone who has not yet sold, it makes it possible to estimate the real tax and not the apparent one.
If you deducted more than the minimum at the time
The opposite case also exists. Some owners, when declaring their rent, calculated depreciation on the total price without separating out the land, or added expenses that did not belong there. Article 40.1 of the IRPF Regulations speaks of "depreciation that is deductible for tax purposes", with the minimum as a floor. If what was deducted exceeded what the rules allowed, the excess was not deductible and the problem lies in the rental returns, which the authorities can correct as long as they are not time-barred. When preparing the sale it is worth reviewing those returns with the same criteria used for the gain, because a check on one usually leads to a look at the others.
Calculating the sale with the years of letting, and reviewing the rental returns that can be corrected, are part of the Salama Tax service for non-residents selling a property.