Income Tax (IRPF) is payable on the income earned by individuals with usual place of residence in Spain, taking their personal and family circumstances into consideration.
Types of income
a) Income from an employment, wages, salaries, pensions, etc.
b) Earnings from capital (share dividends, account interests, etc.) and from real estate capital (from leasing of real estate, etc.).
c) Earnings from economic activities sel employed, professionals, etc.
d) Net gains and capital gains loss (by transfer of goods, some prizes, etc.).
e) Legally established imputations of income from the ownership of some properties, other than the home, that are not leased, etc.).
The amount and the nature of the income received during the year of assessment determines whether you are obliged to file a tax return or not.
Who must file tax returns
Those who had their usual residence in Spain during the year must file a Personal Income Tax Return, with the exception of those who
have exclusively received one or several of the following types of income, with the limits indicated for each case:

A) Income from an employment with the following limits:
1ºs €22,000 per annum, when it is from a single payer. This limit also applied if received from several payers when:
• The sum of amounts received from the second and remaining payers, in order of amount, do not exceed €1,500 per annum as a whole.
• The only earnings from work consist of public pensions and that the applicable rate of tax withheld at source had been determined in accordance with the special procedure established by law. This procedure should be requested in the months of January and February of the year of the tax return (Form 146).
2º. The limit is set at €10,000 per annum when:
• It comes from more than one payer, provided that the sum of the amounts received from the second and remaining payers, in order of amount, exceed €1,500 per annum.
• It comes from alimony from their spouse or maintenance, unless the latter come from the parents by legal decision.
• The payer of the earnings is not obliged to withhold tax at source (for example, foreign pensions).
• Work earnings subject to a fixed tax withholding rate.

B) Earnings from capital and capital gains subject to tax withheld at source if they jointly do not exceed €1,600 per annum.

C) Imputed real estate earnings that come from the ownership of properties, earnings from Treasury Bills and subsidies for the purchase of subsidised housing or rated price housing, with the combined limit of €1,000 per annum.
It is not necessary for taxpayers to file a tax return if they obtain exclusively earnings from work, capital (liquid and real estate), economic activities and capital gains, whether subject or not to tax withheld at source, when the sum of all of them does not exceed €1,000 per annum and capital gains losses amount to less than €500.
However, taxpayers who want to benefit from the application of the following allowances must file a tax return:
• Allowance due to investment in the usual home.
• Allowance due to company savings account.
• Allowance due to international double taxation.
• Reduction in the taxable base due to contributions to the different social security systems.
These limits are the same for individual and joint taxation. If the taxpayer exceed any of these limits, he must file a tax return.

Tax return draft
Taxpayers who are either obliged or not obliged to file an income tax return can request the Tax Agency to send them, merely for informative purposes, a DRAFT tax return if their income comes exclusively from:
a) Earnings from work.
b) Income fromcapital subject to tax withheld at source, as well as those from Treasury Bills.
c) Imputation of real estate income, provided that they come, at most, from two properties.
d) Capital gains subject to tax withheld at source, as well as public aids for the acquisition of the usual place of residence.
The draft tax return cannot be confirmed by:
a) Those who had obtained exempt income with progressive scale by virtue of agreements underwritten by Spain to avoid international double taxation.
b) Those with negative entries pending compensation from previous financial years.
c) Those who aim to regularise tax situations from previously filed tax returns.
d) Those who have the right to deduction due to international double taxation who exercise this right.