RESIDENCE AND STAY IN TENERIFE

13/03/2025

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Residence and stay in Tenerife for foreigners is administratively well-regulated and relatively easy to achieve, but remains essential.

Spain is a popular destination for foreigners, both for short stays and long-term residence. The rules for stay and residence depend on nationality, duration of stay, and the purpose of the visit. Additionally, there are tax obligations for those residing in Spain for more than 183 days per year. This article provides an overview of the different residence statuses, residency conditions, and tax declarations that foreigners must comply with. For personalized advice, it is advisable to contact the Spanish Immigration Office (Extranjería) or a tax consultant. Residence and stay in Tenerife

Residence Options in Spain

Short Stay (Tourism or Business Travel)

Non-EU/EEA citizens may stay in Spain for a maximum of 90 days within a 180-day period without a visa, provided their nationality falls under visa-free agreements. A residence permit is required for a longer stay.
EU/EEA citizens and Swiss nationals enjoy free movement and can stay in Spain for up to three months without additional formalities. For stays longer than 90 days, they must register with local authorities.

Legal Residence (Stay Longer than 90 Days)

Non-EU/EEA citizens must apply for a temporary residence permit depending on their situation. Popular visas include:
- Non-lucrative visa: For individuals with sufficient financial means to reside in Spain without working.
- Work visa: Requires an employment contract or self-employment activity.
- Student visa: For those studying in Spain.
- Golden visa: For investors who invest at least €500,000 in Spanish real estate.
EU/EEA citizens must register as residents in the Registro Central de Extranjeros after three months and demonstrate that they are working, studying, or have sufficient financial means.

Permanent Residence

After five years of legal residence, both EU and non-EU citizens can apply for permanent residence. This grants long-term residency rights without the need to renew the residence status.

What is Tax Residency?

You are considered a tax resident in Spain if you stay in Spain for more than 183 days per year or if you have a financial and/or family center in Spain.

Tax residency means you are liable for taxes on your worldwide income, regardless of where it is earned. This is separate from your legal residency.

Tax Declarations for Tax Residents

Income Tax (IRPF – Impuesto sobre la Renta de las Personas Físicas)

Taxes worldwide income, including wages, rental income, dividends, and interest.
Must be declared annually, usually between April and June.

Wealth Tax (Impuesto sobre el Patrimonio)

Taxes total wealth, including real estate, investments, and savings.
Exemption: Up to €700,000, plus €300,000 for the primary residence.

Capital Gains Tax (Impuesto sobre las Ganancias Patrimoniales)

Taxes profits from the sale of assets, such as stocks or real estate.
Declared together with income tax.

Property Tax (IBI – Impuesto sobre Bienes Inmuebles)

Local tax on real estate, calculated based on cadastral value.
Payable annually to the local municipality.

Inheritance and Gift Tax (Impuesto sobre Sucesiones y Donaciones)

Taxes inheritances and gifts, with rates varying by region.

VAT (IVA – Impuesto sobre el Valor Añadido)

Mandatory for self-employed individuals and businesses engaged in economic activity in Spain.

Modelo 720 (Declaration of Foreign Assets)

Mandatory for tax residents with foreign assets over €50,000 (bank accounts, investments, real estate).
Must be declared before March 31.

Modelo 149 (Registration as a Tax Resident)

One-time registration upon establishing tax residency in Spain.

Tax Obligations for Non-Residents

Modelo 210 (Non-Resident Tax)

Required for foreigners with income or assets in Spain.
Payable by property owners in Spain (even if the property is not rented).
Rate: 19% for EU citizens, 24% for non-EU citizens.

Modelo 720 (Foreign Assets Declaration)

Mandatory for tax residents with foreign assets over €50,000.
Penalties for non-compliance can reach €10,000.

Modelo 149 (Tax Registration for Non-Residents)

Non-residents must appoint a tax representative in Spain for tax declarations.
Required for rental or sale of real estate.

NIE Number

What is an NIE Number?

The Número de Identificación de Extranjero (NIE) is a mandatory identification number for foreigners in Spain who work, study, purchase property, or have tax obligations.

What is an NIE Number Used For?

Purchasing real estate
Employment and tax declarations
Opening a Spanish bank account
Enrolling in education
Business activities

How to Apply for an NIE Number?

In Spain: Apply at a Comisaría de Policía.
Outside Spain: Possible via the Spanish consulate.
Required documents: Passport and copy – Form EX-15 – Proof of reason for application (e.g., employment contract, purchase agreement).

Conclusion

Foreigners residing in Spain must comply with both legal and tax obligations. The rules vary for EU and non-EU citizens, and the distinction between tax and legal residency is crucial. For a short stay (up to 90 days), there are few formalities, but for long-term residence, registration and possibly a visa are required. Additionally, tax residency entails extensive tax obligations.
Residence and stay in Tenerife are well-regulated and relatively easy to arrange for foreigners, but they remain essential for those planning long-term living or investment on the island.

It is advisable to seek professional advice from a lawyer or tax consultant in a timely manner to avoid fines and complications. Residence and stay in Tenerife are subject to specific legal clauses and regulatory laws.

Guy Devos © Photography
Residence and Stay in Tenerife ©
Sources:
Agencia Tributaria – www.agenciatributaria.es
Extranjería – www.inclusion.gob.es
Ministerio del Interior – www.interior.gob.es