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May 16, 2025 Daniele Piccoli No Comments Fees and Taxation, Legislation/Laws, Model 400, vivienda vacacional

What is Model 400 in the Canary Islands and What is it for: Complete Guide 2025

The “Model 400” is a fundamental administrative document in the Canary Islands, used for various tax and legal procedures. This model is closely related to the Canarian tax system, which has peculiarities compared to the rest of Spain, thanks to the Canary Islands’ special economic and fiscal regime (REF – Régimen Económico y Fiscal de Canarias). In fact, the Canary Islands enjoy a differentiated tax regime, with specific taxes and regulations aimed at promoting the economic and social development of the archipelago.

What is the Model 400?

Form 400 is a tax declaration required for the registration, modification or termination of a business activity in the Canary Islands. It is mandatory for all natural or legal persons who intend to carry out a commercial, entrepreneurial, professional or artistic activity in the archipelago. It serves mainly for the purposes of the Canary Islands Indirect General Tax (IGIC), the equivalent of VAT in the rest of Spain, but with generally lower rates.

Features of the Model 400

The Model 400 is mainly used for:

Registration of new businesses: Anyone who wants to start a business in the Canary Islands, such as running a “vivienda vacacional” (vacation home), must fill out this form to register with the Census of Entrepreneurs and Professionals.
Changes in tax information: Changes in location, changes in business or any other tax-relevant changes require submission of an updated Form 400.
Cessation of business: In case of cessation of business, Form 400 must be submitted to notify the Canary Islands Tax Agency of the closure.

The Canary Islands Indirect General Tax (IGIC).

A tax peculiarity of the Canary Islands is the IGIC, with an ordinary tax rate of 7 percent, which is lower than the VAT in the rest of Spain. The Form 400 is closely related to the IGIC, as it is essential for the correct identification of economic activity for the purposes of this tax.

What is the Model 400 for?

The Model 400 has several central functions for the fiscal and administrative management of economic activities in the Canary Islands:

1. Registration for tax purposes

The first function of Form 400 is to register an economic activity for tax purposes. For example, if you want to start a “vivienda vacacional” business for your apartment, you must submit this form to the Canary Islands Tax Agency.

2. Notification of changes to the activity

If the business undergoes changes, such as a change of address or corporate purpose, these must be reported via Form 400.

3. Cessation of business.

When a business is discontinued, Form 400 must be filed to avoid continuing to be subject to IGIC-related tax obligations.

4. Fulfillment of tax obligations

The Form 400 is essential for tax compliance in the Canary Islands. It ensures that the business operates in accordance with local tax regulations.

How to Apply for Model 400?

If you plan to start a “vivienda vacacional” (vacation rental) business with your apartment in the Canary Islands, Form 400 is an essential step. Completing it requires you to enter specific details related to your business, including:

Identifying data: Name, address, and tax identification number of the person or company.
Activity data: Description of the activity, sector it belongs to, and address of the activity.
Type of operations: Types of operations that will be carried out, especially in relation to IGIC.
Applicable tax regime: Details of the specific tax regime applicable to the activity.

To request the Form 400, contact our agency. We will assist you every step of the way to ensure proper filing and registration of your “vivienda vacacional” business, ensuring compliance with all tax and legal regulations.

Importance of Model 400

The Model 400 is fundamental to the proper functioning of the tax system in the Canary Islands. It ensures that tax authorities can monitor and manage economic activities, ensuring compliance with local regulations. In addition, the proper administration of the Form 400 avoids penalties and legal problems related to failure to declare or report tax data.

Conclusion

The Form 400 is an essential document for anyone who intends to start a business in the Canary Islands, including the activity of “vivienda vacacional.” It is used to register, modify or discontinue a business, ensuring the proper fulfillment of tax obligations, particularly in relation to the IGIC. For proper filing of Form 400 and to start your vacation home business, contact our agency. We will be happy to assist you every step of the way.

Daniele Piccoli +34 635632009 +39 3518711203

May 14, 2025 Daniele Piccoli No Comments Real Estate Agent, Short Term Rentals/Tourist Rentals

Explotación Turistica: What No One Tells You Before You Buy House in Gran Canaria

Investing in Gran Canaria is not always a bargain: beware of tourist traps.

TOURISM EXPLOTACIÒN: WHEN PRICE DOES NOT MAKE VALUE

The price not does the value

Continuous a receive reports by people which yes leave bewitch from prices Interesting, visa the market current, by apartments finely restructured located at complexes luxurious e taken care of in the zones best of south by Grand Canaria But.

…no one says them that they are buying a apartment in complex under explotaciòn turística!!

"Rogue" real estate agencies?

There are agencies real estate at South by Grand Canaria which not so if define clever o only ignoramuses!
Not can believe that in 2025, after well 30 years of explotaciòn turística On the island, still these agents real estate not any know the meaning… or do they pretend?

Ignorance is no longer an excuse

Not I can accept which people of genre continue at operate undisturbed on the island cheating unsuspecting investors which maybe have sweaty one life for put by part these money e now are fooled so…

But the consciousness these people ce have one?

Ignorance in these cases not è allowed!
There are of decrees law which regulate l’explotaciòn turística by decades e which by decades are updated e modified, e who works at sector real estate MUST know them!

Documents, laws and notaries

We want to talk about Ley de propiedad horizontal?
We want to list i documents which need for buy a property e which not you will have never when you will buy one room Of hotel?

E not give the blame to the notaries if still in 2025 are stipulated these sales:
the notary not has the obligation by ask you if you are sucker o intelligent, you ask by buy e him puts at act the procedure for Doing so… period!

What about the complicit lawyers?

E not rely a know-it-alls lawyers in cahoots with the agencies…
Ne I have hear many by agreements at shoulders of buyers for divide the loot which I could write a book!

How to recognize a hotel masquerading as an apartment

When these agents there bring a visit real estate new e glittering, with furnishings e furnishings clearly by hotel, at complexes with reception h24, sir of housekeeping with i carts, guys of animation e especially one nice license plate at view at the entrance main with one great H… possible which a doubt small small but right small not there comes which state looking at a hotel????

Watch out for "too good" prices

Not serves be experts agents real estate but have a minimum by spirit by remark e especially thinking:
why this nice apartment has a price lower at dive bars inner e by renovate which I have visited so far?
Mah Who knows… I’ll be status fortunate a meet this agent so kind e are clever a not pay almost 200.000 euro for one dive bar as those which I have visited so far!

The limit between dumb e cunning è very labile in this case…

The only one who gains is.

Very simple!
Buy a apartment of kind is equivalent a throwing i money from the window, at be fine, means which the only which there will gain è the owner which yes will le one nice cat by peel, but will be also the agent real estate which will celebrate the his nice commission thank you at chicken by shift.

The limitations of this type of investment

The agents real estate not there will say never the issues underlying at a investment of genre o for ignorance o for cunning, and è for this motif which not you must entrust i your money a anyone, but a professionals of sector which know follow you seriously e with transparency to the yours objective, helping you a realize it at best.

Why a property in explotación turística is a trap

But why a property under explotaciòn turística not è a good investment?

In first firstly because you are buying a room hotel a all the effects e obviously not you can put you the yours residence nor rent it by long term for I same reason.

Not you can however not even rent it for months o nights why there will think the company explotadora a do it for you… thanking you with a compensation monthly maximum of 400 euro, pocketing at least 10 times as much with home your own!

Here are the real numbers

In summary, when purchased a property of genre you are obligated a deliver the keys e the management at company internal which yes will occupy by locarlo at tourists a prices by their established, recognizing you a paltry amount fixed monthly.

Consider that a property of such costs 170.000 euro + taxes = about 190.000 euros.

La yours annuity by 400 euro x 12 months = 4.800 euro gross per year, at such as you will pay the taxes…
At end there will remain maybe the 2% yearly on the investment.

What if I want to resell?

Definitely there will be who says. “okay me goes good, better of banks.” But.if then I wanted to sell it a someday?

You should meet a chicken like you… difficult, but not impossible!

Beware of "hoax" gurus and luxury hotel showcases

After this explanation practice by what means buy a property at complex under explotaciòn turística, you I invite a look at yourself well from relying to agents real estate fuffa gurus who will try to win you over With:

the comfortable mattress which keeps the shape of your body for 10 years
the shower a overflow with walls made of granite illuminated
the view fantastic on the pool from a terrace furnished in rattan woven…

Of course, are rooms designed by multimillion-dollar chains hotels…
There would miss also that were miserable!

The truth: what a professional would propose to you

A professional not you would propose never of buy a property at a complex of such as this.

A professional not è “expensive” why you proposes real estate expensive by renovate at fourth plan without elevator at same price Of the hotel… but Because:

knows that restructuring it the your income will be very more higher
not you will lose the control of your property
you can take advantage of it when you want
you can resell it easily a a other investor

Contact me

If do you want deepen the topic, me are a available for a consultation free of charge in the my office o by phone.
I will I will explain in detail what e where buy a property on the island, without whether e without but.

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May 3, 2025 Daniele Piccoli No Comments Legislation/Laws, Model 210

Form 210 in the Canary Islands: What is it and what is it for?

The Form 210 in the Canary Islands is an essential tax document for those with economic interests in the Canary Islands, especially if they are nonresidents. Although the Canary Islands are part of Spain, they enjoy a special tax status that makes them an attractive destination for investors and property owners. Understanding Form 210 and its use is essential to avoid legal problems and ensure proper tax management of one’s activities.

What is the Model 210?

Model 210 is a Spanish tax form used to declare and pay taxes on the income of nonresidents in Spain. Its main function is to allow tax authorities to collect taxes on income generated by individuals or legal entities that do not reside in Spain but generate income in the territory, including income generated in the Canary Islands.

Key features of the Model 210:

Recipients: Form 210 applies to all individuals and legal entities not resident in Spain who obtain income from sources located in the Canary Islands. This includes income from real estate, business activities, or investments.
Types of Income: This model covers various types of income, including rental income from real estate, capital gains from the sale of property, interest income, dividends, and other types of income from economic activities in the Canary Islands.
Frequency: The return may be filed quarterly or annually, depending on the type of income. For example, rental income generally requires quarterly reporting, while other forms of income may be reported annually.

What is the purpose of the Form 210?

Form 210 serves several purposes related to the tax management of income of nonresidents in the Canary Islands. Some of the main purposes include:

1. Payment of Taxes on the Income of Non-Residents

Form 210 is mainly used for the payment of taxes on income generated by nonresidents. Although the Canary Islands has a special tax status, it still follows Spanish tax law regarding the taxation of non-resident income. This means that anyone who earns income in the Canary Islands, while not a resident, is required to declare it and pay the relevant taxes.

For example, a foreign national who owns a house in the Canary Islands and rents it out during the year is required to declare rental income and pay corresponding taxes via Form 210.

2. Fiscal and Legal Compliance

Filing Form 210 correctly is essential to be in compliance with Spanish tax law. Failure to comply with tax return obligations can lead to financial and legal penalties. Submitting this form ensures that nonresidents comply with Spanish tax law, avoiding possible problems with theSpanish Tax Agency (Agencia Tributaria).

3. Management of Real Estate in the Canary Islands

A common case in which Form 210 is used is the management of real property. Nonresidents who own property in the Canary Islands must declare rental income obtained from such property or, in some cases, also deemed income from non-rented property. This form makes it possible to calculate and pay the corresponding tax on such income.

4. Declaration of Capital Gains

When a nonresident sells property in the Canary Islands, he or she is required to declare any capital gains obtained through Form 210. The capital gain is the difference between the sale price and the purchase price, and a tax is charged on this difference. It is important to declare these transactions correctly to avoid penalties and to obtain any refunds of overpaid taxes.

New 2024: Form 210 for non-residents changes

As of January 1, 2024, the Spanish Tax Agency has introduced important changes for those who, while not tax residents in Spain, own property in the country, including the Canary Islands, and receive income from tourist rentals. Form 210, used to declare such income, will be updated both in form and in the way it is filed.

Here’s what changes:

✅ Compulsory telematic submission 1.

Beginning in 2024, Form 210 can only be filed online, through theAgencia Tributaria website. The paper mode has also been eliminated for nonresidents without a tax representative. If you do not have a Spanish digital certificate, it is highly recommended to appoint a tax representative.

✅ Optional annual declaration for rental income 2.

The most significant change concerns the possibility of aggregating rental income and declaring it only once a year, instead of quarterly as was the case in the past.
This option is optional, but allowed only if:

All income comes from the same property;
They are of the same type (e.g., tourist rentals);
The same tax rate is applied.

Due date: January 1 to 20 of the following year (e.g., income 2024 → declaration by January 20, 2025).
If payment by bank debit is desired, the due date is advanced to January 15.

✅ 3. Automated checks with Airbnb, Booking, Vrbo, etc.

The Spanish Tax Agency has activated automatic checks with major tourism platforms. Portals such as Airbnb, Booking.com, Vrbo and the like will send data directly to the tax authorities on income received by owners.
If you do not submit Form 210, even for a few days of renting, the tax authorities will notice thanks to this cross-referenced data.
Failure to declare may result in penalties, even if the amount is minimal.

✅ 4. Deduction of expenses only if on time

EU residents (including Italians) can deduct expenses related to the property (maintenance, local taxes, portal fees, etc.), but only if the declaration is submitted on time.

Late submission means losing the right to these deductions, resulting in higher taxation on the gross.

Penalties for failure to file Form 210

Failure to file Form 210 or filing with inaccurate information may result in penalties from Spanish tax authorities. Penalties can vary depending on the severity of the offense, including fines, interest on late payments, and in some cases, additional legal action.

Summing up

Form 210 is an essential tool for the tax management of non-resident income in the Canary Islands. It is used to declare and pay taxes on various types of income generated in the territory, ensuring compliance with Spanish tax law. Whether you are dealing with real estate, business activities or investments, understanding and using Model 210 correctly is crucial to avoid tax and legal problems.