How does IRPF work?
IRPF is a progressive tax, meaning the more you earn, the higher your tax rate. But here's the key point: only the income in each bracket is taxed at that bracket's rate.
Simple example
If you earn €30,000, you don't pay 30% on all of it. Instead:
- • First €12,450 taxed at 19% = €2,365.50
- • Next €7,750 (€12,450 to €20,200) taxed at 24% = €1,860
- • Next €9,800 (€20,200 to €30,000) taxed at 30% = €2,940
- Total tax: €7,165.50 (effective rate: ~24%)
This is why you shouldn't worry about earning "just over" a tax bracket - only the excess amount is taxed at the higher rate.
IRPF tax rates 2025 (General income)
Spain's IRPF is split between state and regional portions. The rates below are for general income (employment, self-employment, pensions) and represent the combined national rate. Your autonomous community may have slightly different rates.
Tax Brackets Visualized
Each bar shows the income range taxed at that rate
| Income bracket | Tax rate | Cumulative tax |
|---|---|---|
| €0 - €12,450 | 19% | €2,365.50 |
| €12,450 - €20,200 | 24% | €4,225.50 |
| €20,200 - €35,200 | 30% | €8,725.50 |
| €35,200 - €60,000 | 37% | €17,901.50 |
| €60,000 - €300,000 | 45% | €125,901.50 |
| Over €300,000 | 47% | — |
Regional variations
Autonomous communities like Madrid, Catalonia, and Andalucía can adjust their portion of IRPF. Madrid tends to have slightly lower rates, while Catalonia has higher top brackets. The differences are usually 1-2 percentage points.
Savings income tax rates (Base del ahorro)
Investment income - dividends, interest, capital gains - is taxed separately at lower rates called the base del ahorro (savings base):
| Savings income | Tax rate |
|---|---|
| First €6,000 | 19% |
| €6,000 - €50,000 | 21% |
| €50,000 - €200,000 | 23% |
| €200,000 - €300,000 | 27% |
| Over €300,000 | 28% |
This applies to: dividends, bank interest, bond coupons, capital gains from selling stocks/funds/crypto, and capital gains from property sales.
Common IRPF deductions (Deducciones)
You can reduce your tax bill through various deductions. Here are the most common:
Personal allowances
- • Personal minimum: €5,550
- • Age 65+: +€1,150
- • Age 75+: +€1,400 additional
- • Per child: €2,400-€4,500
Pension contributions
- • Max deduction: €1,500/year
- • Company plans: up to €8,500
- • Reduces taxable income
Primary residence
- • Pre-2013 mortgages: 15% of payments
- • Max deduction: €9,040/year
- • New mortgages: no deduction
Other deductions
- • Donations to NGOs: 80% first €150
- • Energy efficiency improvements
- • Maternity deduction: €1,200/year
- • Regional specific deductions
IRPF withholding (Retenciones)
If you're employed, your employer withholds IRPF from your salary each month (retención). This is an estimate based on your expected annual income. Common withholding rates:
Employment income
Variable based on salary, family situation. Usually 15-30% for typical salaries.
Self-employed invoices
Standard 15% withholding. New autónomos: 7% for first 3 years.
Rental income
19% if paid to a company. No withholding for individual landlords (pay via declaration).
Why withholding matters
When you file your annual declaration, you compare total tax owed vs. total withheld. If your employer withheld too much, you get a refund (devolución). If they withheld too little, you pay the difference (a ingresar).
IRPF vs. other Spanish taxes
IRPF is just one of several taxes you might encounter in Spain:
| Tax | What it taxes |
|---|---|
| IRPF | Personal income (salary, self-employment, investments) |
| IVA | Value Added Tax on goods and services (21% standard) |
| IBI | Annual property tax (like council tax/rates) |
| Patrimonio | Wealth tax on net assets over €700,000 |
| Impuesto de Sociedades | Corporate tax on company profits |
| Sucesiones y Donaciones | Inheritance and gift tax |
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