There are two tax regimes that are often referred to as Non-Resident Tax and it can be a little confusing so let me clarify the difference.

IRI: Imputación de Rentas Inmobiliarias

IRI (Imputación de Rentas Inmobiliarias) is a tax imposed on the owner of a property which is neither used for permanent residence nor rented out. This tax is payable regardless of the residency status of the property owner, so, if you were a permanent resident in Spain and owned two properties in the Spanish territory, one as your permanent residence and one as a personal holiday home, IRI would be payable on the holiday home.

IRI would be included in your annual tax return. If the property was rented for any time during the period covered by that tax return then, for that period, IRI would not be payable and instead you would pay income tax on the rental income.

IRNR: Impuesto sobre la Renta de No Residentes

IRNR refers to the taxes payable on income earned in Spain by individuals who are not resident in Spain. IRI and/or income tax on rental income must be submitted as part of these taxes. For most Non-resident holiday home owners, the only taxes due under IRNR are IRI and income tax on rental income and so it is easy to see how the two get grouped as one or referred to interchangeably.

How to Calculate IRI

To calculate IRI you must take 1% of the Catastral Value of the property to establish the taxable base. Tax is then payable at a rate of 24% of that taxable base if you are a non EEA (European Economic Area) citizen, or 19% if you are a EEA Citizen. For example for a property with a Catastral Value of €100,000, a Non EEA citizen would calculate the tax as follows:

If however the property was rented out for 2 months of the year IRI would be Reduced on a pro-rata Basis, as follows: 

Income tax would be payable on the rent received for the 2 months that IRI is not payable.