What Expenses Can You Deduct from Vacation Rental Income in Spain?

Deductible expenses are the key to legally reducing your vacation rental tax bill. Many owners declare income but forget to deduct expenses — or don't know which ones qualify. The result: they pay more tax than they should. This guide details all deductible expenses, how to calculate the correct proportion, and the most common mistakes.

The general rule is simple: you can deduct any expense necessary to earn vacation rental income, as long as it's justified with an invoice or equivalent document. But the devil is in the details — especially proportionality.

The Proportionality Rule

If your vacation rental isn't rented 365 days a year (and none is), you can only deduct expenses in proportion to the days it was rented. Here's the formula:

Deductible expense = Total expense × (Days rented / 365)

For example, if you pay €1,200 in property tax per year and the property was rented 120 days:

Deductible expense = €1,200 × (120 / 365) = €394.52

The remaining days (245) generate imputed real estate income, which is a separate topic. Check our taxation guide for full details.

Deductible Expenses: Complete List

1. Property Tax (IBI)

• Deductible proportionally to days rented
• You need the municipal receipt

2. Homeowners' Association Fees

• Regular fees: deductible proportionally
• Special assessments: deductible if for conservation or repair (not improvements)

3. Home and Liability Insurance

• Annual insurance premium: deductible proportionally
• If you have specific vacation rental insurance, it's 100% deductible during activity days

4. Utilities

• Water, electricity, gas, internet, phone
• Deductible proportionally to days rented
• If you have separate meters or specific invoices for the rental period, even better

5. Cleaning Expenses

• Between-guest cleaning: 100% deductible (direct activity expense)
• Cleaning products: 100% deductible
• Laundry service (sheets, towels): 100% deductible

6. Repairs and Maintenance

• Breakdown repairs: deductible proportionally
• Preventive maintenance (boiler, AC): deductible proportionally
• Painting, minor fixes: deductible proportionally
• Important: improvements (renovations that increase property value) are NOT deductible expenses — they're depreciated

7. Property Depreciation

• You can deduct 3% annually of the higher of:
  • Acquisition cost (excluding land)
  • Cadastral construction value (excluding land)
• Proportionally to days rented
• This is one of the most forgotten and most significant expenses

8. Furniture and Equipment Depreciation

• Furniture, appliances, kitchenware, décor
• Depreciated at 10% annually (10-year useful life)
• Proportionally to days rented
• You need purchase invoices

9. Platform Commissions

• Airbnb, Booking, Vrbo commission: 100% deductible
• It's a direct expense linked to earning income

10. Management Expenses

• Accountant or tax advisor fees: deductible proportionally
• Booking management software: 100% deductible
• Dynamic pricing tools: 100% deductible
• Guest registration service: 100% deductible

11. Mortgage Interest

• If the property has a mortgage, interest is deductible proportionally
• Only interest, not principal repayment
• You need the bank certificate

12. Advertising and Marketing

• Professional property photography: 100% deductible
• Paid platform ads: 100% deductible
• Own website design: depreciable

13. Travel Expenses

• If you travel to the property for rental management (check-in, maintenance, cleaning): deductible
• Mileage: €0.19/km
• You need to justify the reason for travel

14. Guest Supplies

• Amenities (soap, shampoo, toilet paper): 100% deductible
• Complimentary coffee, tea, water: 100% deductible
• Tourist guides, maps: 100% deductible

Summary Table

Expense	Deductible	Proportional
Property tax (IBI)	Yes	Yes
HOA fees	Yes	Yes
Insurance	Yes	Yes
Utilities (water, electricity, gas)	Yes	Yes
Between-guest cleaning	Yes	No (100%)
Repairs	Yes	Yes
Property depreciation (3%)	Yes	Yes
Furniture depreciation (10%)	Yes	Yes
Platform commissions	Yes	No (100%)
Mortgage interest	Yes	Yes
Management and software	Yes	No (100%)
Advertising	Yes	No (100%)
Guest supplies	Yes	No (100%)
Improvements / renovations	No (depreciated)	—

Common Mistakes

Not Keeping Invoices

Without an invoice or receipt, the expense isn't deductible. Keep everything: receipts, invoices, tickets, bank statements. The tax authority can request them during an audit.

Deducting 100% Without Proportionalizing

If the property isn't rented all year, deducting 100% of fixed expenses is incorrect and can trigger a penalty.

Confusing Improvements with Repairs

Replacing a broken boiler is a repair (deductible). Installing a better boiler than the previous one is an improvement (depreciable, not directly deductible).

Forgetting Depreciation

Property and furniture depreciation is an "invisible" expense that many owners don't apply. It can represent several thousand euros per year in deductions.

Not Deducting Platform Commissions

Airbnb charges hosts 3-5%. Booking charges 15-20%. These commissions are 100% deductible and many owners forget them.

How Autoregistro Fits In

Autoregistro is a 100% deductible expense as a management tool directly linked to tourist activity. But beyond that, it automates guest registration — an obligation whose non-compliance carries its own penalties. Every euro you invest in regulatory compliance is a euro you reduce from your taxable base.