Spain

Over the past year, the following significant reforms have been made to Spanish law on taxation of individuals: 

Royal Decree-Law 18/2026

On 30 June 2026, the Official State Gazette (BOE) published Royal Decree-Law 18/2026, of 29 June 2026, adopting certain measures within the framework of the Comprehensive Response Plan to the Middle East Crisis. The Royal Decree-Law primarily extends, adapts, and phases out temporary energy-tax measures introduced by Royal Decree-Law 7/2026. Although most of these measures relate to indirect taxation or sector-specific aid, they may affect individuals as consumers or self-employed professionals. In this regard, the main tax and support measures affecting individuals are as follows:

Energy taxes

The 10% value-added tax (VAT) rate for certain energy supplies and the 0.5% electricity excise duty rate are extended or adjusted for the relevant months, subject in certain cases to CPI-based conditions.

Diesel refunds and aid

The partial refund for professional diesel is set at zero euros (EUR) from 1 July 2026 to 30 September 2026, while specific rules are established for agricultural and livestock diesel refunds and for direct aid to agricultural producers and transport operators.

Tax on the value of electricity production

Temporary reductions to the taxable base apply during 2026, followed by a gradual reduction of the tax rate in 2027 and 2028.

Royal Decree-Law 12/2026

On 27 May 2026, the BOE published Royal Decree-Law 12/2026, of 26 May 2026, declaring various initiatives and programmes to be events of exceptional public interest. The Royal Decree-Law declares several initiatives and programmes to be events of exceptional public interest for the purposes of Article 27 of Law 49/2002. The tax benefits are those provided for in Article 27.3, generally at the maximum level, subject to the specific duration and conditions established for each event.

Royal Decree-Law 10/2026

On 29 April 2026, the BOE published Royal Decree-Law 10/2026, of 28 April 2026, approving urgent tax measures and other support measures in response to damage suffered by victims of the DANA storm and other emergency situations. The Royal Decree-Law mainly addresses the tax treatment of aid and compensation paid to affected individuals and businesses and introduces adjustments to previously approved energy-related measures:

The main tax measures affecting individuals are as follows:

Personal income tax (PIT) exemption for certain public aid

Certain public aid granted to individuals, businesses, and professionals affected by the DANA storm and other natural disasters is exempt from PIT, provided that the aid falls within the scope and conditions established by the Royal Decree-Law.

PIT treatment of aid granted by non-profit entities

The Royal Decree-Law extends favourable PIT treatment to certain aid granted by non-profit entities to persons affected by the relevant emergencies, subject to the limit of the actual damage suffered.

PIT exemption for compensation to victims of abuses within the Catholic Church

Compensation paid to victims of abuses within the Catholic Church is exempt from PIT under the terms set out in the Royal Decree-Law.

Energy-tax adjustments

The Royal Decree-Law adjusts certain energy-related tax measures previously adopted, particularly in relation to VAT and the professional diesel refund scheme.

Royal Decree-Law 7/2026

On 21 March 2026, the BOE published Royal Decree-Law 7/2026, of 20 March 2026, approving the Comprehensive Response Plan to the Middle East Crisis.

The main tax measures affecting individuals are as follows:

PIT deductions

The temporary PIT deductions for energy-efficiency improvement works in dwellings, the purchase of plug-in electric or fuel-cell vehicles, and the installation of battery charging points are extended until 31 December 2026. A new PIT deduction is also introduced for renewable self-consumption systems installed between 1 January 2026 and 31 December 2026, subject to the applicable limits and to the exclusion of assets used for economic activities.

Energy taxes

The VAT rate for certain supplies of electricity, natural gas, biomass briquettes and pellets, and firewood is temporarily reduced to 10% until 30 June 2026, subject to the relevant CPI condition. The Royal Decree-Law also temporarily reduces hydrocarbons tax rates and the electricity excise duty rate and introduces temporary rules for the tax on the value of electricity production.

Transfer tax and stamp duty

A new exemption is introduced for transfers of energy savings within the framework of the Energy Savings Certificate System.

Royal Decree-Law 6/2026

On 4 March 2026, the BOE published Royal Decree-Law 6/2026, of 3 March 2026, amending Law 20/2022, of 19 October 2022, on Democratic Memory, in relation to the recognition of compensation for persons who died or suffered incapacitating injuries as a result of their activity in defence and vindication of democracy. The Royal Decree-Law also amends the Personal Income Tax Law to clarify the tax treatment of the relevant compensation.

The main tax measures affecting individuals are as follows:

Inclusion of PIT exemptions

The list of PIT-exempt income is expanded to include compensation granted under the Democratic Memory framework and indemnities awarded for imprisonment, injury, or death linked to events between 1968 and 1978.

Legal framework

The legal framework is updated for recognition and payment of indemnities awarded for imprisonment, injury, or death linked to events between 1968 and 1978.

Royal Decree-Law 5/2026

On 19 February 2026, the BOE published Royal Decree-Law 5/2026, of 17 February 2026, adopting urgent measures in response to the damage caused by various adverse weather events, with special impact in Andalusia and Extremadura. The Royal Decree-Law combines direct aid, local tax relief, fee exemptions, and PIT measures linked to the 2026 increase in the minimum wage.

The main tax and support measures affecting individuals are as follows:

Direct aid and non-seizability

Direct aid is provided for personal injury, damage to dwellings and household goods, damage to business establishments, and evacuation or relocation expenses. Aid granted under the Royal Decree-Law, as well as tax refunds resulting from its tax measures, are treated as non-seizable.

PIT and objective assessment regime

PIT relief measures are introduced in connection with the 2026 increase in the minimum wage, and reductions are made to the net income indices applicable under the objective assessment regime for agricultural activities affected by natural disasters.

Local taxes and fees

A full property tax (IBI) exemption applies to damaged properties meeting the relevant requirements, proportional business activities tax (IAE) reductions are provided for affected businesses, and certain administrative fee exemptions are introduced in connection with the affected areas and circumstances.