Short-Term Lets and VAT in Spain: What the October 2026 Decree Says
By Dmitry Mateshin, Founder
A housing decree published in October 2026 sets a 10% VAT rate on certain short stays from 1 December. This guide explains what the text says, what is still open, and how it could change a net-yield calculation.
In June 2026 the Spanish press reported that the government would raise VAT on tourist flats to 21%. In October, a housing decree was published with a different figure: a reduced rate of 10% for certain short stays, from 1 December 2026. If you let, or plan to let, a home on a short-term basis, the difference between a headline and the text matters for your numbers. This guide sets out what the decree says, what is still undecided, and how to build it into a net-yield calculation.
The short answer
According to the text of Royal Decree-law 29/2026, from 1 December 2026 the reduced 10% VAT rate applies to the letting of furnished homes where the stay for the same tenant does not exceed thirty nights. Lets that include hotel-type services remain under the general regime. There is an exception connected with the landlord's own habitual residence. Whether and how this changes the tax position of a specific owner depends on the owner's circumstances, which is a question for a gestor.
What the decree says
The text is Article 7 of Royal Decree-law 29/2026 of 6 October 2026, published in the official gazette on 7 October 2026. For VAT it says:
- Rate. These lets fall under the reduced rate that applies to hotel and similar accommodation.
- Condition. The home is furnished, and the stay for the same tenant does not exceed thirty nights.
- Services. Lets that include hotel-type complementary services stay under the general regime.
- Exception. The text excludes accommodation that is the landlord's own habitual residence.
- Date. The change takes effect from 1 December 2026.
The decree also reduces VAT to 10% on renovation works on homes intended for habitual rental. The Tax Agency's own page says the decree's second title introduces important changes to personal income tax and VAT, and it publishes a summary of the main tax changes. That summary is the document to read before you take any decision.
What else the decree touches
- Municipal property tax. Municipalities in areas declared as stressed housing markets may apply a surcharge to the IBI on homes used as tourist accommodation, with figures reported in the press of up to 150%. Whether any Costa del Sol municipality falls in such an area is a question for the town hall.
- Platforms. The decree sets sanctions of up to one million euros or 2% of turnover for short-let platforms that do not comply with the European digital single gateway.
What is not settled
- Validation. A decree-law applies from publication, but its continuation depends on a vote in the Standing Committee of Congress. Press reports expect that vote around 12 November 2026. We will not describe the rule as permanent before then.
- Interpretation. We have not seen administrative guidance on how Article 7 interacts with the existing treatment of residential lets, or when a landlord must register or charge VAT. Wait for guidance, or ask your gestor.
- The earlier 21% report. The June announcement was described as a plan under drafting. The October text is what has been published, and it says 10%. Read the decree, not the headline.
What it could mean for a net-yield calculation
Our guide to rental yield on the Costa del Sol shows how to move from gross to net. VAT adds a step if, and only if, it applies to your lets.
An illustration, using assumptions only: suppose a short stay is advertised at €1,000 and the price is VAT-inclusive at 10%. Then €1,000 divided by 1.10 is €909.09 of revenue, and €90.91 is VAT. If instead VAT is added to the price, the guest pays €1,100 and may choose a different property. Which case applies, and whether VAT you pay on costs can be set against it, depends on your situation. Replace the figures with your own and ask your gestor to model them.
The point is not the arithmetic. It is that a short-let yield built on advertised prices needs a VAT line, and that this line is not yet settled for 2027.
Dates to keep in mind
- 6 October 2026. The decree-law is signed.
- 7 October 2026. It is published in the official gazette.
- 8 October 2026. It enters into force, according to press summaries; the VAT change itself is dated later.
- Around 12 November 2026. The Standing Committee of Congress is expected to vote on whether to confirm it, according to press reports.
- 1 December 2026. The VAT change takes effect.
If you take bookings for December or later, check your listings, prices and invoices against these dates with your gestor before the vote, and again after it.
Questions for your gestor
- Does the new 10% rate apply to my lets from 1 December 2026, and how do I register or report it?
- Are my lets within the thirty-night limit, and do any services I provide take me into the general regime?
- Is my home my habitual residence for the purposes of the exception?
- How does this interact with my income tax as a non-resident, and with the tourist licence rules?
- What happens to my pricing, platform listings and invoices on 1 December?
A selection of apartments and new developments
If you are comparing homes with letting in mind, here is a selection of apartments and new developments from our catalogue:
We let properties and manage them for non-resident owners, and we are happy to talk through the practical side of letting. Ask for a shortlist through How We Work, or browse the Collection.
Read the official text and the Tax Agency's summary, then speak to your gestor before you change prices. For the full buying sequence and costs, start with our buying guide.
This guide is general information, not legal or tax advice, and not a forecast of returns. Rents and prices are asking figures and change; rates and rules change too. Confirm current figures with your independent lawyer or gestor before you commit. Property details and prices are confirmed on request.
