This article provides general tax information for educational purposes and is not legal, tax or financial advice. Buyers should obtain independent professional advice for their circumstances.

Quick Answer

British investors buying Marbella property generally choose between three structures: direct personal ownership, a Spanish company (SL), or a foreign holding company. Personal ownership is simplest and works well below the €700,000 wealth tax exemption per individual; a Spanish SL can improve rental-income tax efficiency through expense deductibility but adds corporate compliance and a less favourable capital gains route on eventual sale; a foreign holding company can, in specific high-value cases, keep the property out of Spanish wealth tax scope entirely, but requires careful structuring to avoid triggering worse outcomes elsewhere. There is no single right answer — it depends on whether the property will be rented, held long-term, or eventually passed to heirs.

1. Direct personal ownership: non-resident individuals pay 19% (EU/EEA) or 24% (non-EU, including UK post-Brexit) on Spanish-sourced rental income via Modelo 210, and are exposed to Spanish wealth tax above the €700,000 per-person exemption (€1.4M for a non-resident couple).
2. Spanish company (SL) ownership: allows deduction of legitimate business expenses against rental income, which can lower the effective tax rate on rental yield, but adds annual corporate accounting and filing costs.
3. Foreign holding company ownership: shares in entities where more than 50% of assets are Spanish real estate can still be pulled into Spanish wealth tax scope — this structure only works as intended when built correctly, and is not a simple workaround.
4. Andalusia’s 100% regional wealth tax rebate means many British buyers below the €3M Temporary Solidarity Tax threshold pay no practical wealth tax regardless of structure — for this group, simplicity often beats structuring complexity.

Why structure matters before you buy, not after

The ownership structure chosen at purchase affects four separate tax outcomes over the life of a Marbella investment: annual rental income tax, annual wealth tax exposure, capital gains tax on eventual sale, and inheritance tax on transfer to heirs. Changing structure after purchase — moving a property from personal name into a company, for example — is itself a taxable transfer event in Spain, so the decision made before completion is far cheaper to get right than to correct later.

For British investors specifically, Brexit changed the baseline: UK nationals are now taxed as non-EU/EEA residents for Spanish purposes, which means the higher 24% non-resident income tax rate applies (versus 19% for EU/EEA residents) and, under the prevailing gross-basis approach for non-EU owners, expense deductibility against rental income has historically been more restricted — though 2025 case law developments have begun to shift this position for some non-EU owners, making professional review of the current rules essential before assuming the older, less favourable treatment still applies without exception.

Structure 1 — Direct personal ownership

The simplest route: the property is bought and held in the individual’s own name, or jointly with a spouse or co-investor. Each owner files their own Non-Resident Income Tax (IRNR) return via Modelo 210, either quarterly for actual rental income or annually for notional ‘imputed income’ if the property is used privately and not rented.

On wealth tax, each non-resident individual has a state-level exemption on the first €700,000 of Spanish assets, meaning a married couple buying jointly can shelter up to €1.4M before wealth tax exposure begins — and Andalusia’s 100% regional rebate means, in practice, most buyers below the €3M Temporary Solidarity Tax on Large Fortunes threshold face no real wealth tax bill under this structure at all.

For the majority of British buyers purchasing a single Marbella property for personal use or occasional letting, direct personal ownership remains the simplest and often most tax-efficient structure — complexity should be added only where it demonstrably saves more than it costs in compliance.

Structure 2 — Spanish company (SL) ownership

Holding the property through a Spanish sociedad limitada (SL) changes the tax base for rental income from the individual non-resident rates to Spanish corporate tax treatment, and allows deduction of legitimate business-related costs — management fees, maintenance, financing costs, depreciation — against rental income in a way that can materially improve the effective tax rate on a heavily-let investment property, particularly relevant for British investors who, as non-EU owners, have faced more restricted personal-level expense deductibility.

The trade-off is ongoing compliance: annual corporate accounts, corporate tax filings, and the administrative cost of maintaining the company, which only pays for itself where rental activity is substantial enough for the expense-deduction benefit to outweigh the added running cost. On eventual sale, a corporate structure changes the capital gains calculation and can affect withholding requirements differently from a personal sale — this needs modelling against the specific expected holding period and exit scenario, not assumed as automatically better.

Structure 3 — Foreign holding company

Some British investors consider holding Marbella property through a UK or other foreign holding company rather than directly or via a Spanish SL. This can, in specific circumstances, be structured to keep the property outside direct Spanish wealth tax scope — but Spanish tax rules specifically target this: shares in any entity, Spanish or foreign, where more than 50% of underlying assets are Spanish real estate can still be pulled into Spanish wealth tax scope under look-through provisions.

Where this structure can genuinely work is when the property sits within a foreign entity alongside other, higher-value assets, such that Spanish real estate does not represent the majority of that entity’s asset base — a structuring decision that requires coordinated advice from both a Spanish tax adviser and a UK/international adviser before the purchase, not a template that can be applied uniformly. Treated as a simple workaround without that underlying asset-mix condition being genuinely met, this structure frequently fails to deliver the intended saving and adds cost and complexity without benefit.

Comparing the three structures

This comparison is deliberately structural, not a recommendation for any individual case — the right choice depends on planned use (personal, let, or mixed), expected holding period, total wealth outside Spain, and succession planning intentions, all of which need a named Spanish tax adviser’s input before purchase, not a generic guide’s conclusion applied uniformly.

Inheritance and succession — the factor most buyers underweight

Structure choice also shapes how a Marbella property passes to heirs. Direct personal ownership triggers Spanish inheritance tax (Impuesto sobre Sucesiones y Donaciones) on transfer, with rates and allowances varying significantly by autonomous community — Andalusia has introduced substantial allowances that reduce the practical burden for close family transfers, but the calculation still needs to be run against the specific estate. Corporate or foreign holding structures can, in some cases, simplify succession by transferring shares rather than triggering a direct property transfer, but this is jurisdiction-specific and should be modelled as part of the initial structuring decision, particularly for British buyers who also need UK inheritance tax and probate rules coordinated alongside the Spanish position.

Frequently Asked Questions

Should I buy my Marbella property through a company to save tax?

Not automatically. A Spanish company (SL) can improve rental income tax efficiency for heavily-let properties through expense deductibility, but adds compliance cost and changes the capital gains calculation on sale. For a single property held mainly for personal or occasional use, direct personal ownership is often simpler and equally or more tax-efficient once Andalusia’s wealth tax rebate is factored in.

Does owning property through a foreign company avoid Spanish wealth tax?

Not reliably. Spanish rules specifically target this: shares in any entity, Spanish or foreign, where more than 50% of assets are Spanish real estate can still be pulled into Spanish wealth tax scope. It can work as intended only where the Spanish property is a minority holding within a larger, multi-asset entity, and requires coordinated professional structuring, not a simple template.

How much Spanish wealth tax will I pay as a British property owner?

For most British buyers, potentially none in practice. Each non-resident individual has a €700,000 exemption on Spanish assets, and Andalusia currently applies a 100% regional rebate on the balance. Buyers with total Spanish net wealth above roughly €3M may still be liable for the separate state-level Temporary Solidarity Tax on Large Fortunes regardless of regional rebates.

Can I change my property from personal ownership into a company later?

Yes, but it is a taxable transfer event in Spain, meaning transfer tax and potentially capital gains implications apply as if you were selling the property to the new owning entity. It is significantly cheaper to choose the right structure before completion than to restructure afterward.

Does Brexit affect which structure is best for British investors?

Yes. Since Brexit, British owners are taxed as non-EU/EEA residents, facing the higher 24% (versus 19% EU/EEA) non-resident income tax rate and, historically, more restricted rental expense deductibility at the personal level — though 2025 case law has begun to shift this for some non-EU owners. This tilts the calculation slightly more toward considering a Spanish SL structure for actively-let properties than it would for an EU-resident buyer, though it remains case-specific.

Sources & References

1. addwill — Real estate assets in Spain after changing tax residency: key tax considerations (structure comparison, look-through rules on foreign entities) — https://addwill.eu/en/real-estate-assets-in-spain-after-changing-tax-residency-key-tax-considerations-not-to-overlook/
2. GGI — Buying property in Spain: Can I put it under a company’s name to save taxes? (€700,000 wealth tax exemption, Andalusia rebate) — https://www.ggi.com/news/real-estate/buying-property-in-spain-can-i-put-it-under-a-companys-name-to-save-taxes
3. Pellicer & Heredia — Wealth Tax 2026: Tax rate and guide for expatriates (state allowance, Temporary Solidarity Tax on Large Fortunes) — https://www.pellicerheredia.com/en/wealth-tax-spain/
4. Co-Ownership Property — Spain Property Tax for Co-Owners in 2026 (IRNR rates, post-Brexit British owner treatment) — https://co-ownership-property.com/blog/spain-property-tax-co-owners-itp-ibi-wealth-tax-2026/
5. Vogue Properties — Non-resident income tax on Spanish property: UK owners’ guide (Modelo 210 filing, 2025 expense-deduction case law shift) — https://www.vogueproperties.com/blog/non-resident-income-tax-spain-property/
6. Hilton Real Estate — Spain Wealth Tax in 2026: Rules, Exemptions and Solidarity Tax Explained (Beckham Law wealth tax interaction) — https://www.hilton-realestate.com/insights/spain-wealth-tax-in-2026-complete-guide-for-expats-property-owners-and-foreign-investors