Madrid and Andalusia proudly advertise that their Wealth Tax is zero. What they announce with less enthusiasm is that for fortunes above three million euros, the Solidarity Tax on Large Fortunes steps in and collects precisely what the regional exemption intended to leave in the taxpayer's pocket. This guide explains how the real system works, what expatriates pay in each community, and how the Beckham regime fundamentally changes the wealth tax equation.
The Wealth Tax: the basic structure
The Impuesto sobre el Patrimonio (IP) is governed by Ley 19/1991. It is a national tax assigned to the autonomous communities, which have power to regulate:
- The exempt minimum (national default: €700,000).
- Deductions and exemptions from the liability.
- The regional scale (within the limits of the national subsidiary scale).
The national subsidiary IP scale 2026 [VERIFY] applies to net wealth exceeding the exempt minimum:
| Taxable base (from) | Taxable base (up to) | Rate |
|---|---|---|
| €0 | €167,129 | 0.20% |
| €167,129 | €334,253 | 0.30% |
| €334,253 | €668,500 | 0.50% |
| €668,500 | €1,337,000 | 0.90% |
| €1,337,000 | €2,673,999 | 1.30% |
| €2,673,999 | €5,347,998 | 1.70% |
| €5,347,998 | €10,695,996 | 2.10% |
| €10,695,996 | Onwards | 2.50% |
This scale applies where no regional scale has been approved. Communities with a 100% exemption (Madrid, Andalusia) eliminate the resulting liability, but not the taxable base that feeds into the ITSGF calculation.
Regional Wealth Tax comparison 2026
The position by autonomous community in 2026 [VERIFY — subject to legislative changes]:
| Autonomous Community | Exemption / Rate | Effective liability up to €3M | ITSGF position |
|---|---|---|---|
| Madrid | 100% exemption | €0 | ITSGF applies from €3M |
| Andalusia | 100% exemption | €0 | ITSGF applies from €3M |
| Catalonia | No full exemption, own scale | 0.21% – 2.75% | ITSGF deducts IP paid |
| Valencia | No full exemption | 0.25% – 3.12% | ITSGF deducts IP paid |
| Balearic Islands | Own scale | 0.28% – 3.45% | ITSGF deducts IP paid |
| Murcia | 100% exemption | €0 | ITSGF applies from €3M |
| Galicia | Reduced exemption | Low rates | ITSGF deducts IP paid |
| Basque Country | Own foral system | Variable (foral) | ITSGF does not apply equally |
| Navarre | Own foral system | Variable (foral) | ITSGF does not apply equally |
| Ceuta and Melilla | 75% exemption | Reduced rates | ITSGF applies partially |
The Solidarity Tax on Large Fortunes: the equaliser
Ley 38/2022 created the Temporary Solidarity Tax on Large Fortunes (ITSGF), in force since tax year 2022 and confirmed by the Constitutional Court in 2023 (STC 149/2023).
The ITSGF has one defining characteristic: it is calculated on the same taxable base as the IP and deducts from its liability whatever was already paid as regional Wealth Tax. This mechanism ensures that a taxpayer with €5 million in wealth in Madrid pays exactly the same effective ITSGF as one in Catalonia — the ITSGF collects the difference.
ITSGF scale 2026 [VERIFY]:
| Taxable base (from) | Taxable base (up to) | ITSGF rate |
|---|---|---|
| €0 | €3,000,000 | 0.00% |
| €3,000,000 | €5,000,000 | 1.70% |
| €5,000,000 | €10,000,000 | 2.10% |
| €10,000,000 | Onwards | 3.50% |
The ITSGF exempt minimum is the same as the IP’s: €700,000. Result: the first portion of wealth exempt from the ITSGF is €3,700,000 (€700,000 exempt minimum + first bracket at 0% of €3,000,000).
Numerical example: €5 million in Madrid versus Catalonia
Profile: HNW individual resident in Spain, net wealth €5 million in Spain
Calculation in Madrid (standard residency):
| Item | Amount |
|---|---|
| Net wealth | €5,000,000 |
| Exempt minimum | -€700,000 |
| IP taxable base | €4,300,000 |
| IP liability (Madrid scale) | €0 (100% exemption) |
| ITSGF base | €4,300,000 |
| ITSGF bracket 0–€3M (0%): €3,000,000 | €0 |
| ITSGF bracket €3M–€5M (1.7%): €1,300,000 | €22,100 |
| Deduction for IP already paid | -€0 |
| ITSGF liability | ~€22,100 |
| Total burden (IP + ITSGF) | ~€22,100 |
Calculation in Catalonia (standard residency):
| Item | Amount |
|---|---|
| Net wealth | €5,000,000 |
| Exempt minimum | -€700,000 |
| IP taxable base | €4,300,000 |
| IP liability (Catalonia scale, indicative) | ~€35,000 |
| ITSGF base | €4,300,000 |
| ITSGF bracket 0–€3M (0%): €3,000,000 | €0 |
| ITSGF bracket €3M–€5M (1.7%): €1,300,000 | €22,100 |
| Deduction for IP already paid (Catalonia) | -€22,100 |
| ITSGF liability | €0 (Catalonia IP already exceeds the ITSGF amount) |
| Total burden (IP + ITSGF) | ~€35,000 |
Counter-intuitive result: For €5 million, Catalonia (€35,000) pays more than Madrid (€22,100). The neutralisation is not perfect: the ITSGF collects what should have been paid under its scale, and if the regional IP exceeds the ITSGF liability, the taxpayer pays the full IP amount. Only when the regional IP is €0 (Madrid) does the ITSGF collect the full amount under its own scale.
For wealth of €10 million, the burden is approximately equal across communities, since the ITSGF reaches full effect and neutralises any regional differences. [VERIFY]
The Beckham regime interaction: the obligación real advantage
Impatriates under the Beckham regime do not pay Wealth Tax as residents. They pay in obligación real, meaning the taxable wealth is exclusively assets situated in Spanish territory.
This is one of the least-known benefits of the Beckham regime for HNW individuals:
- Foreign real estate: not included in the IP base under Beckham.
- Listed foreign company shares: not included (with exceptions for companies whose main assets are in Spain).
- Foreign bank accounts: not included.
- Foreign investment funds: not included.
If an impatriate under Beckham has the bulk of their wealth abroad (the typical case for an international executive), their Spanish IP taxable base may fall below the €700,000 exempt minimum, resulting in zero IP liability and zero ITSGF liability.
Example: Beckham impatriated professional with €5 million in foreign assets
| Item | Amount |
|---|---|
| Total wealth | €5,000,000 |
| Wealth in Spain (Madrid flat) | €800,000 |
| Exempt minimum (general) | €700,000 |
| IP taxable base under obligación real | €100,000 |
| IP liability (on €100,000) | ~€200 (subsidiary scale 0.2%) |
| ITSGF (base below €3M) | €0 |
| Total burden | ~€200 |
Compared with the same wealth under standard residency in Madrid (~€22,100 ITSGF), the saving from obligación real under Beckham is over €21,000 per year. [VERIFY — deductibility of the principal residence under obligación real requires case-by-case verification]
Five common mistakes in expatriate wealth planning
1. Believing Madrid’s 100% exemption protects against everything
Madrid’s exemption is real but applies only to the regional IP. The ITSGF operates above €3 million regardless.
2. Not filing the Wealth Tax return under obligación real as Beckham
Even if the liability is €0 or minimal, Form 714 may be mandatory if gross wealth in Spain exceeds €2,000,000 (declaration threshold, even if no liability results).
3. Not accounting for foreign pension rights
Under obligación real, pension plans situated in Spain are included in the IP; foreign ones generally are not, but this depends on the type of plan and the applicable double-taxation treaty.
4. Confusing the IP and the ITSGF in the annual filing
The IP is declared via Form 714 before 30 June. The ITSGF has no separate form: it is settled within the same Wealth Tax campaign deadline.
5. Not reviewing portfolio composition when leaving the Beckham regime
In the year an impatriated professional exits the Beckham regime and becomes a standard resident, they automatically switch from obligación real to obligación personal for Wealth Tax purposes. If at that point they have significant foreign wealth, the first Wealth Tax return as a standard resident can come as a shock.
When to consult a professional
Wealth tax planning for an expatriate in Spain requires professional analysis when:
- Total net wealth (Spanish + foreign) exceeds €1,000,000.
- The Beckham regime is being considered and there are significant foreign assets.
- Purchasing Spanish real estate for over €700,000 is contemplated.
- The portfolio includes stakes in unlisted companies.
- Long-term stay in Spain makes advance wealth structuring advisable.
BMC’s Spain Expat Tax Guide 2026 includes a Wealth Tax and ITSGF analysis for the HNW profiles we advise most frequently: international executives, family offices, and digital entrepreneurs. The BMC team can prepare a bespoke simulation with current 2026 rates.
Sources
- Ley 19/1991 — Impuesto sobre el Patrimonio — BOE-A-1991-10791
- Ley 38/2022 — Temporary Solidarity Tax on Large Fortunes — BOE-A-2022-22414
- AEAT — Wealth Tax and ITSGF — sede.agenciatributaria.gob.es
- Ley 35/2006 LIRPF, art. 93.4 (Beckham, obligación real IP) — BOE-A-2006-20764
- STC 149/2023 — Constitutionality of the ITSGF — tribunalconstitucional.es
