If you are taxed in Norway
Norway taxes worldwide income and wealth, and relieves the Spanish tax by credit. Norwegian net wealth tax is the part that surprises people.
Credit on income, and wealth tax at home
Norway taxes its residents on worldwide income and on net wealth. The Norwegian–Spanish treaty uses the credit method for income from property: the Spanish house is declared in Norway and the Spanish tax is set against the Norwegian bill. Net wealth is the separate issue — the Spanish property counts in your Norwegian formueskatt, and Spain may also charge its own wealth tax on the same asset.
What you actually declare
While you own it
- Spanish imputed income tax and IBI are paid in Spain.
- The property is included in Norwegian net wealth at its assessed value.
- Spanish wealth tax above €700,000 per owner may apply on top — how the two interact is a question for an adviser who knows both.
If you rent it out
- Spain taxes the rental profit at 19 % with costs deductible.
- Norway taxes the income and credits the Spanish tax.
- Short-term letting can be treated as business income in Norway above certain levels.
When you sell
- Spain taxes the gain at 19 %; the buyer withholds 3 % on account.
- Norway taxes the gain and credits the Spanish tax. The Norwegian exemption for a long-held holiday home has conditions that are rarely met abroad.
Five questions for your own adviser
How is the Spanish property valued for Norwegian formueskatt?
Do the Spanish and Norwegian wealth taxes overlap on the same asset?
Is my letting private income or business income in Norway?
Does the Norwegian holiday-home exemption reach a house in Spain?
Which Spanish documents does Skatteetaten require?