The Canary Islands autonomous regional government has, on Friday May 22, approved the long awaited new regulating holiday homes. The Canary Islands Government Deputy Minister of Tourism, said that “after months of work, together with associations, industry players and public institutions, we have finally arrived at a standard for the development of this activity on the islands.”


Not application in Tourist Areas


In a surprise for some, who thought inevitable the inclusion of homes and apartments in established tourist zones, the new law “expressly excludes from the scope of this regulation” areas that are already covered by the tourism rules, “buildings in tourist zones that are within tourism developments or tourist areas, as well as tourist homes located in mixed residential developments or tourist developments, according to the definitions established by the existing Law, on renewal and modernization of Canaries tourism”.


In a few words that means, that if your holiday house is in an already regulated area, then it is still prohibited for you to rent to tourists or anyone for short periods, usually of less than three to six months.


The new rules, as expected from the previous drafts, states that houses or apartments outside of the existing regulated zones “may only be marketed as vacation homes where no such activity is expressly prohibited by the statutes of the community”. So if your residential community statutes says that you cannot rent to tourists, rent short term, or sublet, then you are also still not allowed to contravene these law agreed between proprietors of your complex. So if you are outside the regulated tourist areas, and your community does not forbid you renting short term, then you may consider carrying out tourist rentals, however in another aspect contained in the decree you must begin by submitting a sworn statement “by the operator…prior to the start of the activity of operating a holiday home”


The requrired paperwork


The new rules specifies that “the holders thereof or, where appropriate, the natural or legal persons to whom the owner has previously entrusted exploitation, must formalise their responsibility for these activities” and register with the appropriate institution (Cabildo of each island), agreeing to comply with the new law and to maintain compliance throughout the periods of rental.


At the same time, the person responsible for the declared activity must show at least one of these three documents, depending on the date the permit is requested:


  • the occupation license or cédula de habitabilidad

  • certificate of occupancy,

  • If you don’t have that previous documents because the house is old you will need an special certificate from a technical person very complete.

  • Declaration responsibility (a form from the Cabildo)


This law is quite clear to protect the users of these holiday homes and specifies expressly that “advertising, supply and management of vacation homes must conform to the requirements of truthfulness, objectivity and good faith, providing the user with enough information on the characteristics of [the house], conditions of use and performance of the contracted services, all without prejudice to the provisions of the existing rules on advertising and consumer protection and the end user.” It is include in the regulation that the owner must to inform to the police with the details of the people/clients who are coming to accommodate in the property.


Between the owner and the client have to have a contract or agreement document in which, at the very least, is contained the amounts to be paid, the binding terms of the contract, indicating hours, maximum number of people who can occupy the house and the prices to be charged for the service accommodation, all with the tax (IGIC) included. This document must be drafted in at least Castilian (Spanish) and English.”


The penalty in case you don’t fulfill the requirements of this law or you continue renting the property out of the regulation are between 18000.-€ and 60000.-€, just in case you have an inspection.


At the same time don’t forget  that for this kind of activity you have to pay taxes to the government.




Alicia Hernández


Lawyer (




On September 3rd 2014, the European Court of Justice delivered a sentence by which it is declared opposed to the equality of all the Europeans and to the principle of free circulation of capitals, the current regulations of the Inheritance and Gift Tax in Spain, by marking differences between the Spanish taxpayers and the rest of the European citizens when it comes to paying those taxes.

As a result of this, those cases in which by being non-resident Europeans have paid the Inheritance Tax by real obligation in Spain over the last few years, that is, according to the Spanish State Regulations and not to the regional ones, where the deceased was a resident and the heirs maybe not, or if any of the heirs was a resident and the deceased was not, or if the Inheritance and/or Gift Tax had been paid on properties located in Spain, Canary Islands, etc… in all of those cases, the tax payer is entitled to the refund of the Inheritance and Gift  Tax by the Spanish Government, as payment of the same goes against the law.           

In many of these cases, as the payers of those taxes were subjected to the State Regulation that was the most damaging for them, they were not applied the reductions nor the deductions that the regulations of the autonomous communities established, such as those laid down for example in the Canary Islands for its residents, which proved very harmful for their economy.   

The regulation already establishes a series of procedures against the Tax Administration and ways to get that money paid to the State Treasury, and we will have to differentiate if it has been over four years since those taxes were paid, or not, to determine the procedure to be chosen, either by way of unduly paid revenue or by way of action for damages against the Spanish State. 

The maximum term to be able to start this procedure against the Tax Administration is ONE YEAR from the day November 10th 2014, so it is extremely important that the subjects who paid those taxes initiate such proceedings before the Administrative sends them any notice that may interrupt the limitation period, which would entail that that money could no longer be claimed, because if there is any verification or notification by the Treasury on any of these taxpayers, there will be no refund. 

Therefore it opens the possibility of recovering a large part of the Inheritance and Gift Taxes that were paid by European citizens, either by inherited properties located in Spanish territory, or by circumstances in which all or some of the heirs or the deceased were residents in Spain, and also, the Administration will have to repay that amount with the accrued interests.  

If you need assistance to claim the reimbursement of your Inheritance or Gift Tax, you can count on our team and we will make you a brief preliminary study in order to establish what is the status of your file against the claim of those revenues, unduly paid by you. 


Alicia Hernández Socorro (Lawyer) 

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