Canary Islands
Modelo 400
Required to operate a holiday rental in the Canary Islands — and to apply for a VV License.
What is the Modelo 400?
The Modelo 400 is an agreement with the Canarian government that commits you to charge and pay IGIC — the Canarian equivalent of VAT. IGIC is levied at 7% (compared to 20% UK VAT or 21% mainland Spanish IVA).
A VV License (Vivienda Vacacional) cannot be applied for without a Modelo 400. It is one of the mandatory prerequisites for any new holiday rental licence application in the Canary Islands.
You apply through the Agencia Tributaria Canaria (ATC) website using your Spanish digital certificate. Non-resident owners can apply remotely from outside Spain, provided they have a valid NIE number, a Spanish bank account, and a digital certificate. Villa Check In manages the entire application on your behalf.
Once approved, you are enrolled in the IGIC system and must charge 7% IGIC on top of all rental income. You then file this quarterly via Modelo 420, typically handled by a qualified Spanish accountant (gestor). The Modelo 400 itself is a one-time registration — the quarterly filings are what continue on an ongoing basis.
Important change from January 2024
Before 2024, non-resident owners with revenue under €30,000 did not need to charge IGIC. From 1 January 2024, this exemption no longer exists. All bookings must now include IGIC regardless of revenue. Once a Modelo 400 is issued, you are legally required to pay IGIC quarterly via Modelo 420. Speak to your Spanish accountant before proceeding — this is a serious financial commitment.
Non-Resident Tax in the Canaries
EU fiscal residents
Fiscal residents of EU countries (including Iceland, Norway, and Liechtenstein) can deduct eligible expenses and pay 19% of net profit in tax.
Non-EU fiscal residents
Fiscal residents of non-EU countries cannot deduct any expenses and pay 24% of gross income.
Deductible Expenses (EU residents only)
Expenses are deducted pro-rata based on the proportion of nights rented in the calendar year. For example, if you rented 182 out of 365 nights, you can deduct 50% of your eligible expenses.
Worked Example (EU resident)
60 nights rented out of 90 in Q1. Revenue: €1,000. Total eligible costs: €200. Rental proportion: 60 ÷ 90 = 66.67% Deductible costs: €200 × 66.67% = €133.34 Taxable income: €1,000 − €133.34 = €866.66 Tax due (19%): €866.66 × 19% = €164.67
Note: This example does not include any IGIC owed.
Quarterly Modelo 420 Deadlines
Once you have a Modelo 400, you must file Modelo 420 quarterly via your Spanish accountant.
| Rental period | Filing deadline |
|---|---|
| Oct – Dec | 1–6 January |
| Jan – Mar | 1–6 April |
| Apr – Jun | 1–6 July |
| Jul – Sep | 1–6 October |
How to Apply for a Modelo 400
Obtain a Spanish Digital Certificate
You need a valid Spanish digital certificate to access the Agencia Tributaria Canaria (ATC) online portal. Non-residents typically use one issued by the FNMT (Fábrica Nacional de Moneda y Timbre). Villa Check In can help you obtain one remotely.
Confirm your NIE and Spanish bank account
A NIE (Número de Identificación de Extranjero) is required for the application. You will also need a Spanish bank account to pay IGIC quarterly. Both must be in place before submitting.
Gather your supporting documents
You will need: property title deed (escritura), NIE certificate, passport, proof of Spanish bank account, and details of your rental activity.
Submit the Modelo 400 via the ATC portal
The form is submitted electronically through the Agencia Tributaria Canaria. This is where the digital certificate is used to sign and authenticate the submission. Villa Check In submits on your behalf and manages all communication with the ATC.
Begin filing quarterly Modelo 420 returns
Once approved, you must declare and pay your quarterly IGIC via Modelo 420 — typically filed by your Spanish accountant (gestor). Deadlines are the first six days of January, April, July, and October.
Frequently Asked Questions
Do I need to register for IGIC even if I don't rent much?
Yes. Since 1 January 2024, the previous €30,000 annual revenue exemption was removed. All short-term rental owners in the Canary Islands must register for IGIC via Modelo 400, regardless of income level.
Can I apply for Modelo 400 from outside Spain?
Yes. With a valid Spanish digital certificate and NIE number, you can apply remotely without travelling to Spain. Villa Check In regularly handles applications for clients based in the UK, mainland Europe, and beyond.
How long does it take to get a Modelo 400?
Processing by the Agencia Tributaria Canaria typically takes two to four weeks. Villa Check In submits applications promptly and follows up directly with the ATC to avoid unnecessary delays.
What happens if I don't register?
Operating without a Modelo 400 is a regulatory violation and may jeopardise your VV Licence application. Penalties for non-registration can apply, and you cannot legally charge IGIC — which itself creates further compliance issues.
Do I need a Spanish accountant for the Modelo 420 filings?
Yes. Quarterly IGIC returns (Modelo 420) must be filed by a qualified Spanish accountant (gestor). Villa Check In can connect you with trusted gestores in the Canary Islands who specialise in non-resident holiday rental accounts.
Is IGIC the same as VAT?
IGIC (Impuesto General Indirecto Canario) is the Canary Islands' own indirect tax — functionally equivalent to VAT but applied at 7%, much lower than mainland Spain's IVA at 21%. It applies only within the Canary Islands.
What is the difference between Modelo 400 and Modelo 420?
Modelo 400 is the one-time registration that enrolls you in the IGIC system. Modelo 420 is the quarterly return you file to declare and pay the IGIC you have collected from guests. You need the 400 first; the 420 follows every quarter.
Can Villa Check In apply on my behalf?
Yes. Our Modelo 400 service costs €150 + IGIC. We handle everything: document gathering, submission to the ATC, and confirmation. Contact us to get started.
Need help with your Modelo 400?
Villa Check In can apply for your Modelo 400 on your behalf. The service costs €150 + IGIC. Contact us to get started.