Regional taxes compared

It is for anyone considering, planning or carrying out a move to Spain. After reading, you should be able to tell whether regional tax differences should influence your choice, and what questions to put to an adviser.

Start with "Which Spanish regions have lower or higher taxes for residents?" It gives the overall comparison across income, wealth, property and inheritance. The other pages go deeper on wealth and inheritance tax, property purchase taxes, the Basque Country and Navarre's separate systems, and the Canary Islands' special regime.

This topic does not cover how income tax is calculated, tax residency tests, the purchase process or regional benefits.

Key rules

• Madrid top income rate: The top income tax rate in Madrid is about 45% as of 2025.
• Inheritance tax baseline: National inheritance tax rates range from 7.65 to 34 percent as of 2024-2025.
• Solidarity tax: Spain's solidarity tax on large fortunes applies to net wealth above 3 million euros.
• Madrid resale tax: Madrid charges 6% transfer tax on resale homes as of 2024-2025.
• Canary consumption tax: The standard consumption tax in the Canary Islands (IGIC) is 7%.
• Which region taxes you: For income tax purposes, you are taxed by the region where you spent the most days in the tax year, and that region's tax rules apply for the whole year.

Regional taxes compared: the whole process, step by step

• Work out which region's tax rules apply to you: the region where you spend the most days of the tax year (see "Which Spanish regions have lower or higher taxes for residents?"): Before you choose where to live and before your first tax year in Spain

• If you plan to live in the Basque Country or Navarre, confirm you will be habitually resident there (more than 183 days) and file with the provincial Hacienda Foral or the Hacienda Foral de Navarra, not the AEAT (see "The Basque Country and Navarre's separate tax systems, explained"): Before the tax year in which you settle there

• Compare property purchase taxes in the regions you are considering (see "How property purchase taxes differ between Spanish regions"): Before you sign a purchase contract

• If you plan to set up a company in the Canary Islands, check whether the Zona Especial Canaria applies: the company must create the required jobs within six months of authorisation and invest the minimum within two years (see "The Canary Islands' special tax regime and what it means for you"): Before you set up the company; jobs within six months of authorisation, investment within two years

• Weigh wealth tax and inheritance and gift allowances for your region (see "Weighing wealth and inheritance tax against where you would rather live"): Before you commit to a region, and again before any large gift

• If you give money or property to your children in a region that requires a public deed, such as Andalusia, sign the deed: Within 3 months of the gift in Andalusia

Regional taxes compared: questions that cross several articles

How big is the real difference in income tax between regions?

For a salary of 30,000 to 50,000 euros, the gap between the cheapest and dearest region is usually a few hundred euros up to around 1,000 euros a year. It grows at higher incomes, to several thousand euros at 100,000 euros. Madrid's top rate is about 45%. Read "Which Spanish regions have lower or higher taxes for residents?" next.

Which region do I count as living in for tax?

For income tax, it is the region where you spent the most days of the tax year, and its rules apply for the whole year. Wealth tax uses the region where you live on 31 December. In the Basque Country and Navarre you file with the provincial Hacienda Foral instead. Read "Which Spanish regions have lower or higher taxes for residents?" and "The Basque Country and Navarre's separate tax systems, explained".

If I move to a low-tax region, do I escape wealth and inheritance tax?

Largely for wealth tax, but not for inheritance tax in every case. Madrid, Andalusia and Galicia are among regions that remove wealth tax through a bonus, while Catalonia and Asturias charge it. For inheritance, the region of the person who died usually decides the rules, not yours. Read "Weighing wealth and inheritance tax against where you would rather live".

Does the Canary Islands' ZEC lower my personal income tax?

No, the ZEC is a low-tax regime for companies, with a 4% rate on eligible profits. As a shareholder, director or employee, you still pay normal income tax rates on your pay and dividends. Read "The Canary Islands' special tax regime and what it means for you".

Do gifts to my children follow the same region rules as inheritance?

No, gifts follow different region rules from inheritance. Property follows where it is located and other assets follow where the child lives. Madrid and Andalusia give a 99% bonus on gifts from parents to children.