In this updated 2025 practical guide, we explain everything you need to know about how to declare IGIC if you rent your property to tourists. We'll cover which rentals are subject to IGIC, the tax forms to submit, the REPEP regime for small property owners, and a step-by-step example. We will also share useful tips to avoid penalties.

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What is IGIC and Why Does it Apply to Vacation Rentals in the Canary Islands?

IGIC (Canary Islands General Indirect Tax)

 is the local equivalent of VAT. It is an indirect tax on the consumption of goods and services in the islands.

The difference is that its tax rates are lower than in the rest of Spain (where the general VAT is 21%), and there are even 0% categories in certain cases.

In the Canary Islands, all tourist rentals are subject to IGIC at a general rate of 7%. Unlike mainland VAT, there is no exemption for short-term rentals, even if no hotel-like services are offered.

 Because by renting your home to tourists, you are engaging in an economic activity (providing accommodation services). In the Canary Islands, this activity is not exempt from IGIC: it is considered a tourist service subject to the tax, even if you don’t offer additional "hotel" services (such as daily cleaning or reception).

In summary, if you legally rent your home to short-stay visitors, you must charge IGIC on the rental price and declare it to the Canary Islands Tax Agency.

 IGIC only applies in the Canary Islands. If you are familiar with mainland regulations, keep in mind that there, long-term residential rentals are exempt from VAT, and tourist rentals only pay VAT if hotel-type services are provided. In the Canary Islands, the regulations are different: all short-term tourist rentals carry 7% IGIC by default.

Which Rentals Are Subject to IGIC and Which Are Exempt?

Not all property rentals are subject to IGIC; it depends on the type of lease and the tenant’s intended use:

If you rent an apartment or house to a tenant as a primary residence (long-term contract for exclusively residential use), it is exempt from IGIC. This type of lease is not considered a taxable business activity.

Seasonal rentals that are not for tourism purposes and are intended to meet a temporary need of the tenant (e.g., for temporary work, studies, home renovations, etc.) may also be exempt from IGIC, provided that no typical tourist services are offered and the rental is not marketed as a vacation rental.

Although there is no explicit minimum duration, these contracts typically last several weeks or months and are formalized under the Urban Leases Law (LAU). The key is that the rental does not have a tourist or vacation nature.

Key criteria for a seasonal rental to be IGIC exempt:

The tenant is not a tourist but someone with a specific, non-leisure need.

The property is not advertised on tourist platforms like Airbnb or Booking.

No services typical of the tourism sector are included, such as periodic cleaning, linen changes, reception, etc.

The activity is not carried out systematically or professionally as a tourism business.

 If you rent your apartment to a temporary worker for three months, without advertising it on tourist platforms and without additional services, this lease is exempt from IGIC.

If the rental is aimed at tourists, is listed on platforms like Airbnb or Booking, has a vacation purpose, and is carried out repeatedly or professionally, it is subject to IGIC at the general rate of 7%. This applies even if services like daily cleaning or reception are not offered.

Tax Obligations for Property Owners: Registration, Forms to Submit, and Filing Frequency

As a property owner renting out a vacation home in the Canary Islands, you acquire specific tax obligations related to IGIC. Below are the key steps and requirements to comply with the Canary Islands Tax Agency:

Registration in the Business Census of the Canary Islands (Form 400)

The first step is to register for IGIC by notifying the Canary Islands Tax Agency. This is done through Form 400, the official declaration to initiate a business activity.

In this form, you must indicate that you will be operating a property for tourist purposes, selecting activity code 1685: "Non-hotel tourist accommodations" from the official list.

Filing Form 400 is mandatory before you begin renting the property.

 It registers you as a taxable person for IGIC.

Even if you believe you won’t end up paying IGIC (e.g., because your rental might be exempt or eligible for a special regime), you must still complete this registration. Failing to do so can result in administrative penalties.

Once registration is complete, the Canary Islands Tax Agency (ATC) will assign you a tax ID for the activity, and you can legally operate as a rental host.

Once registered, if your rental is subject to IGIC, you must file quarterly returns to declare and pay the collected tax.

Form 420 is the quarterly IGIC self-assessment form, where you:

Deduct IGIC paid on related expenses (maintenance, cleaning, etc.)

January 1 to 30 of the following year (4th quarter)

If the IGIC on your expenses exceeds what you charged (e.g., due to large investments), you can carry forward the balance to future quarters. Even if you had no activity, you must file a zero return (unless exempt under a special regime).

 Keep organized records of your invoices and expenses with IGIC. You can use the ATC’s electronic platform or accounting software like Quaderno or Debitoor.

In addition to quarterly filings, you must submit an annual summary of your IGIC-related activity using Form 425.

Total taxable base and IGIC accrued for the year

 This form is typically submitted along with the 4th quarter Form 420. The online platform allows both to be filed in one process.

 Even if there was no activity during a given quarter, Form 425 is still mandatory if you carried out IGIC-liable activity at any point during the year.

Special Regime: REPEP (Small Entrepreneurs and Professionals)

If your annual income from vacation rentals does not exceed 30,000 euros, you can opt into the REPEP, a simplified tax regime that allows you to operate without charging IGIC.

You are not required to file quarterly Form 420

You simplify your accounting and avoid ongoing tax procedures

However, you cannot deduct IGIC on your expenses since you are not charging any IGIC. For many small landlords, this trade-off is worth it due to reduced paperwork.

Tick the REPEP box when submitting your Form 400 registration

You will remain in this regime as long as you stay below the 30,000 euro annual threshold

 REPEP is only available to individuals fiscally resident in the Canary Islands. If you are not a resident, you cannot apply.

 Even if you don’t file Form 420, you must report your annual income via Form 425, usually with no payment due.

If you exceed 30,000 euros in income, you will switch to the general regime the following year and must begin charging IGIC.

You can voluntarily leave REPEP if you prefer to use the general regime.

Need help deciding if REPEP is right for you?

 Pambnb can help you analyze your case and choose the most favorable tax option.

When a guest books for 400 euros, that total already includes the 7% IGIC. To determine the tax amount and your real income, here’s the breakdown:

IGIC (7%) = 400 € x 7 / 107 = 26.17 € Owner's net income (taxable base) = 400 € - 26.17 € = 373.83 €

So, the owner must declare 26.17 euros as IGIC, and the actual income is 373.83 euros.

 Platforms like Airbnb or Booking often subtract their commission before transferring payment.

For example: If the guest pays 400 euros and the platform charges 15% (60 euros), the owner receives 340 euros. But IGIC is always calculated based on the full 

, not the amount received in the account.

Additional Services with Different IGIC Rates

If your invoice includes extra services (e.g., garage rental, equipment, transfers), these are separate from the accommodation and may be taxed at different IGIC rates.

For example: A separately rented parking space is taxed at 5%.

Each item should be listed separately on the invoice with its applicable rate.

Practical Comparison: REPEP vs General Regime (with IGIC)

Maria chose not to join REPEP because she expected to earn more than €30,000 annually or preferred to deduct IGIC on her expenses. Therefore, she applies the 7% IGIC to every reservation.

During the year, she invoices a total of €12,000 (IGIC included), which breaks down as:

IGIC accrued: €12,000 × 7 / 107 = €785.05

Taxable base: €12,000 – €785.05 = €11,214.95

IGIC charged: €3,000 × 7 / 107 = €196.26

Cleaning (15 stays × €50): €750 → IGIC = €49.07

Tax to pay: €196.26 – €55.61 = €140.65

So Maria will pay €140.65 in the first quarter and repeat this process each quarter.

This shows how the general regime allows for deductions but requires more administrative effort.

Now suppose Maria chose the REPEP special regime because she expected modest earnings (under €30,000).

She does not apply IGIC to guest invoices.

En esta guía práctica y actualizada para 2025, te explicamos todo lo que necesitas saber sobre cómo declarar el IGIC si alquilas tu propiedad a turistas. Cubriremos desde qué alquileres están sujetos, los modelos fiscales a presentar, el régimen REPEP para pequeños propietarios, hasta un ejemplo paso a paso. También compartiremos consejos útiles para evitar sanciones.

Guarda esta guía completa sobre IGIC en favoritos o compártela con otros propietarios para tenerla siempre a mano. ¡Evita errores y empieza con buen pie!

¿Qué es el IGIC y por qué se aplica al alquiler vacacional en Canarias?

IGIC (Impuesto General Indirecto Canario)

 es el equivalente canario al IVA. Es un impuesto indirecto que grava el consumo de bienes y servicios en las islas​.

La diferencia es que sus tipos impositivos son más bajos que en el resto de España (donde el IVA general es 21%), e incluso existen categorías al 0% en determinados casos​.

En Canarias, todos los alquileres turísticos están sujetos al IGIC con un tipo general del 7%. A diferencia del IVA peninsular, aquí no existe exención para los alquileres de corta estancia, incluso si no se ofrecen servicios hoteleros.

¿Por qué los alquileres vacacionales pagan IGIC? Porque al alquilar tu vivienda a turistas estás realizando una 

 (prestación de servicios de alojamiento). En Canarias, esta actividad 

: se considera un servicio turístico sujeto al impuesto, 

aunque no ofrezcas servicios “hoteleros” adicionales

En resumen, si alquilas legalmente tu vivienda a visitantes de corta estancia, debes 

 en el precio del alquiler y declararlo a Hacienda Canaria.

 El IGIC solo se aplica en Canarias. Si conoces la normativa en la península, ten en cuenta que allí el alquiler de vivienda habitual está exento de IVA, y los alquileres turísticos solo pagan IVA si se prestan servicios tipo hotel. 

: todo alquiler de corta estancia con fines turísticos lleva IGIC del 7% por defecto​.

¿Qué alquileres están sujetos al IGIC y cuáles están exentos?

No todos los alquileres de inmuebles tributan IGIC; depende del tipo de arrendamiento y del uso que le dé el inquilino:

Alquiler de vivienda habitual (larga duración):

Si alquilas un piso o casa a un inquilino como 

 (contrato de larga duración con uso exclusivamente residencial), 

. Este tipo de arrendamiento no se considera una actividad empresarial sujeta a tributación indirecta.

 y está destinado a una necesidad puntual del inquilino (por ejemplo, por trabajo temporal, estudios, obras en su vivienda habitual, etc.), también 

siempre que no se ofrezcan servicios típicos del sector turístico y no se comercialice como alquiler vacacional

Aunque no existe una duración mínima legal explícita, en la práctica este tipo de contratos suele tener una duración de 

 y se formaliza mediante un contrato de arrendamiento de temporada recogido en la 

no tenga carácter vacacional ni turístico

clave para que un alquiler de temporada esté exento de IGIC:

, sino alguien con una necesidad puntual y concreta.

no se publicita en plataformas turísticas

No se incluyen servicios propios del sector turístico

, como limpieza periódica, cambio de sábanas, recepción, etc.

No se realiza de forma sistemática o profesional

: Si alquilas tu piso a un trabajador desplazado por tres meses, sin publicidad en plataformas turísticas y sin servicios adicionales, este arrendamiento está exento de IGIC.

En cambio, si el alquiler se dirige a turistas, se oferta en plataformas como Airbnb o Booking, tiene una finalidad vacacional y se realiza de forma repetida o profesionalizada, entonces sí está sujeto al IGIC, con un tipo impositivo general del 7%. Esto aplica, aunque no se ofrezcan servicios como limpieza diaria o recepción.

Obligaciones fiscales del propietario: alta en el censo, modelos a presentar y periodicidad

Como propietario que alquila una vivienda vacacional en Canarias, adquieres obligaciones fiscales específicas relacionadas con el IGIC. A continuación, detallamos los pasos y requisitos clave para cumplir con Hacienda Canaria:

Alta en el censo de empresarios de Canarias (Modelo 400)

 comunicándolo a la Agencia Tributaria Canaria. Para ello, se presenta el 

, que es la declaración censal de inicio de actividad en Canarias.

En este formulario debes indicar que vas a explotar una vivienda con fines turísticos, seleccionando el 

epígrafe de actividad 1685 “Alojamientos turísticos extrahoteleros”

Es obligatorio presentar el Modelo 400 antes de comenzar a alquilar

 la vivienda vacacional. Con ello quedarás registrado como 

Incluso si crees que no llegarás a pagar IGIC (por ejemplo, porque el alquiler pudiera estar exento o acogido a un régimen especial), 

debes formalizar igualmente el alta censal

. Omitir este paso puede acarrear sanciones administrativas.

Una vez completado el alta, la Agencia Tributaria Canaria (ATC) te asignará un 

, y podrás operar legalmente como arrendador.

Declaraciones trimestrales de IGIC (Modelo 420)

Una vez dado de alta, si tu alquiler vacacional está 

, deberás presentar declaraciones periódicas para ingresar el impuesto cobrado.

Declaras el IGIC cobrado a tus huéspedes.

Restas el IGIC soportado en gastos relacionados con la actividad (mantenimiento, limpieza, etc.).

: Se presenta trimestralmente en las siguientes fechas:

1–30 de enero del año siguiente (4º trimestre)

Si el IGIC soportado supera al IGIC cobrado (por ejemplo, en caso de inversiones), puedes compensar el saldo en trimestres futuros. Incluso si no tuviste actividad, deberás presentar el modelo en cero (salvo que estés exento por un régimen especial).

 Llevar un control organizado de tus facturas y gastos con IGIC facilitará mucho la cumplimentación. Puedes usar la sede electrónica de la ATC o software contable compatible (como Quaderno o Debitoor).

Además de los modelos trimestrales, deberás presentar un 

 de toda tu actividad sujeta a IGIC mediante el 

Total de bases imponibles e IGIC devengado durante el año.

Incluye también los periodos sin actividad.

 Del 1 al 30 de enero del año siguiente.

 Normalmente se presenta junto con el Modelo 420 del 4º trimestre. La sede electrónica permite hacerlo todo en un mismo proceso.

 Aunque no hayas tenido actividad en algún trimestre, el Modelo 425 sigue siendo obligatorio si realizaste actividades sujetas a IGIC en algún momento del año.

Régimen especial REPEP (Pequeños Empresarios y Profesionales)

Si tus ingresos anuales por alquiler vacacional 

, un régimen fiscal simplificado que te permite operar 

No cobras el 7 % de IGIC a tus huéspedes.

Simplificas tu contabilidad y ahorras trámites.

, ya que no estás repercutiendo impuesto alguno. Para muchos pequeños propietarios, esta opción es ideal porque la simplicidad administrativa compensa la imposibilidad de deducir.

Marca la casilla del REPEP al presentar el Modelo 400 de alta.

Mientras no superes los 30.000 € anuales, seguirás en este régimen.

solo está disponible para personas físicas residentes en Canarias

. Si no resides fiscalmente en las Islas Canarias, 

 Aunque no presentes el 420, deberás declarar tus ingresos anualmente con el 

Si superas los 30.000 €, pasarás al régimen general al año siguiente y deberás comenzar a repercutir IGIC.

 si te interesa tributar con normalidad.

¿Tienes dudas sobre si el REPEP es la mejor opción para ti? En 

 te ayudamos a analizar tu caso y elegir el régimen más favorable.

Cuando un huésped realiza una reserva por 

. Para calcular cuánto corresponde al impuesto y cuánto es el ingreso real del propietario, se hace lo siguiente:

 y su ingreso neto por el alquiler es de 

 antes de transferir el dinero al propietario.

Por ejemplo, si el huésped paga 400 € y la OTA cobra un 15 % de comisión (60 €), el propietario recibirá

Pero el IGIC se calcula siempre sobre los 400

€, no sobre lo que se recibe en cuenta.

Servicios adicionales con distinto tipo de IGIC

Ten en cuenta que si en la factura cobras conceptos adicionales junto al alquiler (por ejemplo, 

estos servicios se consideran independientes del alojamiento

, cada uno con su tipo impositivo correspondiente.

Comparativa práctica: REPEP vs régimen general (con IGIC)

, porque estimaba que sus ingresos anuales superarían los 30.000 € o porque prefería 

 de sus gastos. Por tanto, repercute el 7 % de IGIC en cada reserva.

IGIC repercutido por trimestre: 3.000 €× 7 / 107 = 

Limpieza: 15 reservas × 50 € = 750 €, con IGIC (7 %) = 

Mantenimiento: 100 €, con IGIC (7 %) = 

Así, Maria deberá ingresar 140,65 € en el primer trimestre y repetir el cálculo en los siguientes.

Este caso muestra cómo el régimen general permite deducir IGIC soportado, pero conlleva mayor gestión periódica.

Caso 2: Maria acogida al REPEP (exenta de IGIC)

Supongamos ahora que Maria optó por el 

régimen especial de pequeña empresa (REPEP)

 al iniciar su actividad, ya que sabía que sus ingresos serían modestos (por debajo de 30.000 €).

Owning a vacation rental property, especially in a high-demand region like the Canary Islands, can be an incredibly profitable venture—if managed strategically. From understanding local regulations to creating an unforgettable guest experience, each step is crucial to generating more bookings, higher nightly rates, and consistent positive reviews.

In this comprehensive guide, we’ll explore the key areas where you can optimize your short-term rental for maximum income. Whether you’re new to the market or looking to improve an existing setup, these tips can help you transform your vacation rental into a reliable source of revenue.

The Canary Islands have year-round appeal, yet clear seasonal patterns shape visitor demand. The high season typically spans from November to the end of March, attracting tourists escaping colder climates, and again from mid-June through the end of August, coinciding with European summer holidays. Conversely, low season periods generally occur from April through mid-June and again during September and October, though September and October often experience stronger bookings compared to April and May.

Recognizing these seasonal nuances helps you strategically adjust pricing and marketing, ensuring optimal occupancy and revenue throughout the year.

Evaluate similar vacation rentals in your area by carefully examining their amenities, pricing strategies, and booking calendars on platforms such as Airbnb or Booking.com. Specifically, analyze their short-term availability—if a competitor’s calendar shows many unbooked days within the next 30 days, it likely indicates a problem with their pricing or marketing strategy. Conversely, if their property is consistently booked well in advance (60-90 days or more), it suggests they have an effective approach that resonates with guests. Leveraging these insights can help you refine your own strategies, attract more bookings, and better position your rental within the competitive local market.

Setting specific, data-driven objectives—like increasing occupancy by 20% over the next 12 months. When defining your goals, measure not only occupancy rates but also the average nightly rate. Increasing occupancy at the expense of significantly lowering nightly rates may not necessarily lead to higher profits. Track your results monthly to assess whether you need to adjust your strategies.

In the Canary Islands, it’s a legal requirement to have a tourist license before advertising a short-term rental. Skipping this step can lead to severe fines, negatively impacting both your finances and your reputation. Additionally, online travel agency (OTA) platforms like Airbnb and Booking.com require your tourist license number to be displayed on your listing. Without this license number, your property listing will be removed. Pambnb can assist you with the entire licensing process, from initial consultation to final paperwork submission.

We made a detailed article for this one. Check it out: 

navigating the vacation rental licensing process in canary islands

Be prepared to handle IGIC (the Canary Islands’ version of VAT) and to register under the correct tax codes if applicable. Depending on your situation, you may also need to pay IRPF (Personal Income Tax) or be subject to non-resident tax rates. Working with a local tax expert or a property management service like Pambnb ensures you stay compliant and avoid unnecessary penalties.

Someone said taxes? We made another article with a lot of details - 

how is tax paid on a holiday home in canary islands.

Short-term rental laws and regulations can change. Keep an eye on local government websites and community forums to stay updated. If new laws emerge about noise restrictions, maximum occupancy limits, or health and safety codes, adapt quickly to remain compliant.

3. Price Strategy and Use Revenue Management

Instead of using a single flat rate all year, consider dynamic pricing tools or strategies that adjust nightly rates based on supply, demand, seasonality, and local events. You can do this manually by setting different rates for high and low seasons, national holidays, and special events—or use a dynamic pricing tool like Pricelabs to automate the process. These tools help you stay competitive, but they do require some learning, so choose one you’re comfortable with. If you’re not very tech-savvy, starting with manual adjustments is a great way to begin optimizing your pricing strategy.

This ensures you’re not leaving money on the table during peak times or scaring away potential guests during slower periods.

Adjust Prices Gradually and Monitor Impact

When modifying your pricing, make small, incremental changes—typically between 5–10%—rather than large adjustments. This allows you to observe how price shifts affect your occupancy without risking a drop in bookings. Review performance every 15 to 30 days to assess whether the changes are driving the desired results, and adjust accordingly.

If you notice a drop in bookings, consider activating platform-specific promotions rather than generic offers. OTAs like Airbnb and Booking.com provide structured discount options, and higher-value promotions—such as a 20% discount on Airbnb—can boost visibility by featuring your listing in newsletters or special sections. Use these tools strategically and for limited periods. Avoid setting artificially high base prices just to show a constant discount year-round, as this can harm your credibility and reduce conversions. When done right, promotions can increase occupancy without significantly impacting profitability.

You can also package amenities or local experiences (like island tours or surf lessons) to add value and justify a higher price point.

We can help you with everything, what are you waiting for, give us a call. Phone number right here +34 822 263 023. 

Keeping up with market trends is one of the most critical—and most challenging—aspects of pricing strategy. Regularly analyzing comparable properties, tracking seasonal shifts, and adjusting rates accordingly requires time, data, and local expertise. For self-managing owners, doing this every week can be overwhelming. That’s where working with a professional agency like Pambnb adds real value—we continuously monitor the market, analyze pricing trends, and adjust your rates to stay competitive and maximize revenue.

4. Elevate Your Listing and Guest Experience

Nuestra información, siempre actualizada

IGIC on Vacation Rentals in the Canary Islands: 2025 Updated Guide for Property Owners

IGIC on Vacation Rentals in the Canary Islands: 2025 Updated Guide for Property Owners

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Streamline Your Property Management with Pambnb

Navigating the Vacation Rental Licensing Process in the Canary Islands: A Guide for Property Owners

How is tax paid on a holiday home in the Canary Islands?

Risks of Renting Out Your Vacation Property Without a License

Rental Management in the Canary Islands

¿Deseas crecer con tu negocio de alquiler vacacional? ¡Cuenta con nosotros!