How index funds are taxed in Spain (IRPF step by step)

One of the great advantages of investing in mutual funds from Spain is their taxation. Here we explain how much and when you pay.

You only pay tax when you sell (redeem)

While your money stays invested, you pay no tax on the appreciation. The gain is only taxed when you redeem and realise a profit.

The gem: switches are tax-free

In Spain you can switch from one fund to another without being taxed. You can change funds or rebalance your portfolio without going through the tax office until the final redemption. This is an advantage ETFs do not have.

The savings-tax brackets (IRPF)

• Up to €6,000 → 19%
• €6,000 to €50,000 → 21%
• €50,000 to €200,000 → 23%
• €200,000 to €300,000 → 27%
• Over €300,000 → 28%

Practical example

With a gain of €60,000:

• First €6,000 at 19% = €1,140
• Next €44,000 at 21% = €9,240
• Last €10,000 at 23% = €2,300
• Total: €12,680 (effective rate 21.1%)

The Taxes tab does this breakdown automatically.

This article is informational and does not constitute tax advice. Consult an advisor for your specific case.