Let's imagine a foreign investor from the United Kingdom who bought an apartment in Maspalomas or Playa del Inglés, hoping to generate rental income in the south of Gran Canaria. For years, the Treasury treated him unequally: while EU investors were allowed deductions for property expenses, he had to cover everything. On July 28, according to Vozpópuli, the National Court changed the script: tax discrimination towards non-EU citizens is incompatible with the free movement of capital guaranteed by the EU..
Alejandro del Campo, a lawyer representing these investors, explains that many had filed applications for reimbursement of undue income, only to receive the classic rejection from the IRS. "Now the Treasury will not only have to recognize the expense deductions, but also justify each objection it makes. For those who invested their money in southern Gran Canaria, this is a breath of fresh air," he points out.
The ruling has direct ramifications for tax rates: the 24% rate that non-EU citizens must pay, compared to 19% for Europeans, could be adjusted, and the tax reduction for residential rentals could be raised from 50% to 60% for all non-residents. For investors in Gran Canaria, this means their return on investment is not reduced by discriminatory rules.
Esaú Alarcón, a partner at Gibernau, emphasizes that this situation is "a textbook case": filing claims now allows for the recovery of income from tax years from 2021 to 2026, preventing them from becoming statute-barred, while awaiting the Supreme Court's final decision, expected in 2027. For small investors, or large foreign property owners who have placed their trust in southern Gran Canaria, this is an opportunity to balance the scales after years of unequal treatment.
The scenario is not trivial: the government is preparing a 100% tax on home purchases by non-EU citizens. But the National Court's ruling demonstrates that European rights outweigh any unilateral initiative, and reminds the Treasury that not everything goes when it comes to protecting those who risk their capital in Spain.
This story is a reminder to investors: investing in southern Gran Canaria carries risks, yes, but it can also pay off if you understand the legal framework. And now, with the National Court on their side, many foreigners could see their legitimate investments recovered and breathe a little easier as the sun continues to shine on the Maspalomas dunes.
