The five layers of property tax for foreign owners
For a non-resident foreign owner there are five potential tax layers on a property: purchase taxes (one-off at acquisition), annual ownership taxes (every year you hold it), rental income tax (every year you let it), wealth tax (where applicable), and disposal tax (when you sell). Below, each layer broken down by country in 2026 rates.
At a glance — the four taxes, four countries
| Tax | UK | France | Spain | Portugal |
|---|---|---|---|---|
| Purchase | SDLT 0–12% + 2% non-resident | Notaire ~7–8% | ITP 6–11% / 10% VAT new-build | IMT to 7.5% + 0.8% stamp |
| Annual | Council tax | Taxe foncière + d’habitation (2nd home) | IBI 0.4–1.1% + IRNR imputed | IMI 0.3–0.45% + AIMI |
| Rental (non-resident) | 20–45% (NRL) | 19% + 7.5–17.2% social | 19% EU / 24% non-EU gross | 25% net (long-let) |
| Wealth | None | IFI above €1.3M | Patrimonio (region-dependent) | AIMI above €600k |
| Disposal (CGT) | 24% | 19% + social, tapered | 19–27% + plusvalía | 28% flat |
Indicative non-resident rates for 2026; they vary by region and budget year. Full detail by layer below.
Purchase taxes (one-off at acquisition)
United Kingdom
- SDLT tiered: 0% to £125k, 2% £125-250k, 5% £250-925k, 10% £925k-1.5M, 12% over.
- Non-resident surcharge: +2% on every band.
- Additional-property surcharge: +5% on every band (raised from 3% on 31 Oct 2024) for second homes / buy-to-let. A non-resident buying a property that isn’t their only home pays both — a combined +7%.
- Land Registry fee: £135-£500 by band.
France
- Notaire fees: 7-8% all-inclusive (covers droits de mutation, registration, notary émoluments).
- This is the single highest one-off tax in any of the four countries.
Spain
- ITP (Impuesto sobre Transmisiones Patrimoniales): regional. Madrid 6%, Catalonia 10-11%, Andalucía 7%, Valencia 10%.
- On new-build: 10% VAT + 1.5% AJD instead of ITP.
- Notary + Registro: ~€1,500.
Portugal
- IMT: sliding scale 0-8% by tranche. Property over €1M = 7.5% flat.
- Imposto de Selo: 0.8%.
- Notary: ~€1,200.
Annual ownership taxes (every year you hold)
United Kingdom — Council Tax
Based on 1991 valuations (yes, really). Bands A-H. A central London 2-bedroom flat is typically Band D-E at £1,200-£2,200/year. Furnished but unoccupied properties pay 100-200% surcharge in many councils (since 2024 reforms). Second-home owners are particularly exposed in Cornwall, Devon, Wales (200% surcharge in some councils).
France — Taxe foncière + taxe d’habitation
Taxe foncière (paid by the owner): based on cadastral rental value. A Paris 60 m² flat = €800-€1,500/year. Recently sharp increases in big cities (Paris +50% over 2022-2024). Taxe d’habitation (paid by occupier — second-home owners pay it): €500-€2,000/year on the same flat, plus up to 60% surcharge in tourist communes (Paris, Bordeaux, Biarritz, Nice).
Spain — IBI + IRNR imputed income
IBI (Impuesto sobre Bienes Inmuebles): municipal, 0.4-1.1% of cadastral value (cadastral is typically 50-70% of market). A €400k Spanish flat with €120k cadastral value pays roughly €600-€1,300/year. IRNR imputed income: non-residents pay 24% (non-EU) or 19% (EU/EEA) on a deemed rental income of 1.1-2% of cadastral value, whether or not the property is rented. Adds ~€500-€800/year.
Portugal — IMI + AIMI
IMI (Imposto Municipal sobre Imóveis): 0.3-0.45% urban, 0.8% rural, on Valor Patrimonial Tributário (cadastral). Lisbon municipality = 0.3%. A €400k Lisbon flat with €180k VPT pays €540/year. AIMI additional: 0.4-1.5% on the portfolio share above €600k per person — so the first €600k is exempt for individual owners.
Rental income tax (for non-residents)
United Kingdom — Non-Resident Landlord Scheme
UK rental income is taxed at the personal income tax rates: 20% basic (up to £50,270), 40% higher (£50,270-£125,140), 45% additional (above). Non-residents register with HMRC under the Non-Resident Landlord Scheme to receive rent gross; otherwise the agent/tenant must deduct 20% at source. Mortgage interest relief is capped (Section 24 — only 20% basic rate credit, not full deduction).
France — Régimes micro vs réel
Micro-foncier: if annual rental income < €15k, automatic 30% allowance, taxed at progressive rates (or 19% for non-EU non-residents) + 17.2% social contributions (EU non-residents) or 7.5% (post-Brexit UK non-residents post-2023). Régime réel: deduct actual expenses including mortgage interest, repairs, depreciation. LMNP for furnished rental: typically more tax-efficient than bare lease, but rules tightened in 2025.
Spain — IRNR on rental
Non-residents pay 24% (non-EU) or 19% (EU/EEA) on gross rental income. Critically: non-EU non-residents cannot deduct expenses — they pay 24% on gross, not net. EU/EEA residents can deduct mortgage interest, repairs, etc. Post-Brexit UK owners pay the 24% non-EU rate with no deductions. This is the harshest rental tax regime in the four countries for British landlords.
Portugal — Categoria F
Long-term rental: 25% IRS for non-residents on net rental income (deductions allowed for repairs, IMI, agent fees). AL short-term rental: 35% of gross is treated as taxable, taxed at 25% — effective ≈ 8.75% of gross.
Wealth tax
United Kingdom
None.
France
IFI (Impôt sur la Fortune Immobilière): 0.5-1.5% on global real estate net assets above €1.3M. Non-residents pay only on French real estate. Primary residence has 30% allowance.
Spain
Patrimonio: 0.21-3.5% on net assets above €700k (some regions €500k). Madrid has 100% bonification — effectively 0%. Andalucía 100% bonification. Catalonia full rate. Non-residents taxed only on Spanish assets.
Portugal
None as a separate wealth tax. AIMI on properties above €600k acts as a quasi-wealth tax on real estate only.
Disposal tax (when you sell)
United Kingdom — CGT
24% on residential property for higher-rate taxpayers (reduced from 28% in April 2024). Annual exempt amount £3,000. Non-residents pay CGT on UK residential disposal since April 2015.
France — Plus-value immobilière
19% income tax + 17.2% social contributions (7.5% prélèvement de solidarité for non-EU including post-Brexit UK) on the gain. Tapered exemption: full exemption after 22 years on income tax, 30 years on social contributions. Primary residence exempt.
Spain — Ganancia patrimonial + Plusvalía municipal
National CGT: 19% on first €6k of gain, 21% €6k-50k, 23% €50k-200k, 27% above €200k for non-residents. Plus plusvalía municipal: a separate municipal tax on the increase in cadastral land value, calculated by formula. Can add 5-15% of the gain.
Portugal — Mais-valias
Non-residents: 28% flat on the full gain for individuals, with no taper. EU/EEA residents can elect progressive scaling. Reinvestment in another EU primary residence within 36 months can defer.
Bottom line for a UK buyer (2026)
A British buyer purchasing a €500k flat as a buy-to-let investment, looking at total all-in tax burden:
- UK: ~10% on purchase + Council Tax + 40% on net rental + 24% on disposal. Most predictable.
- France: ~8% on purchase + Taxe foncière + 19% + 7.5% on net rental + 19-26% on gain (with taper). Heavy on purchase, fair on hold.
- Spain (Madrid): ~7% on purchase + IBI + 24% on gross rental (no deductions for UK owners) + 19-23% + plusvalía on sale. Harsh rental treatment for Brits.
- Portugal: ~7% on purchase + IMI + 25% on net rental + 28% flat on sale. Median burden.
If you’re buying — Outpost calculates this for your specific case
The cost section of every Outpost dossier calculates all-in purchase cost for your buyer profile (currently UK buyer default; we’re adding more origins on the roadmap). The rental ROI section applies the right effective tax rate for non-resident foreign owners. Net yield reflects the real after-tax number.