Canary Islands (IC)
The Canary Islands are Spain's Atlantic autonomous community: Tenerife, Gran Canaria, Lanzarote, Fuerteventura, La Palma, La Gomera, El Hierro and La Graciosa.
Tax & Payslip Guide
Understanding your taxes in Canary Islands — tax year 1 January - 31 December.
📊 Income Tax Brackets
| Income from | Income to | Rate | Notes |
|---|---|---|---|
| 0 | 12,450 | 19% | Approximate combined state + Canary Islands regional IRPF first bracket. Spain splits IRPF between state and autonomous-community scales. |
| 12,450 | 20,200 | 24% | Second bracket, before personal/family allowances and deductions. |
| 20,200 | 35,200 | 30% | Middle-income bracket. The Canary Islands can set regional deductions and small rate differences. |
| 35,200 | 60,000 | 37% | Higher ordinary income bracket for salary, self-employment and rental income. |
| 60,000 | 150,000 | ~45.5% | High-income bracket (combined state + Canary Islands regional component). The Canary Islands regional scale diverges from mainland regions at this level — the combined rate is approximately 45.5%, slightly higher than in Madrid (45%). Actual rate depends on the specific Canary regional scale in force. |
| 150,000 | ∞ | ~49.5% | Top Canary Islands combined rate (state + regional). The Canary Islands top rate reaches approximately 49.5% above €150,000, which is notably higher than Madrid (47%) but lower than some other regions (Valencia ~54%). Always verify the current Canary regional scale at atc.gob.canarias.es or use the AEAT simulator. |
🏛️ Social Contributions
Main Spanish social security contribution for pensions, ordinary sickness and family benefits. National rules apply in the Canary Islands.
Funds contributory unemployment benefit (paro).
Wage guarantee fund paid by employers only.
Professional training contribution.
Pension solidarity contribution effective 1 January 2026 (raised from 0.13%/0.67% in 2025).
Self-employed workers register nationally with TGSS but file Canary IGIC instead of mainland IVA when their activity is in scope.
🛒 VAT Rates
The Canary Islands are outside the EU VAT territory. Mainland IVA (21%/10%/4%) does not apply to local Canary supplies; businesses usually file IGIC with Agencia Tributaria Canaria, and imports may trigger IGIC/AIEM plus customs handling.
🧾 Sample Payslip Decoder
🌍 Special Expat Tax Rules
Spanish Beckham Law may apply to qualifying inbound workers and some digital-nomad/remote-work cases if the national criteria are met and Modelo 149 is filed within 6 months of the relevant Seguridad Social registration. It is national, not Canary-specific. Canary Islands also have the Zona Especial Canaria (ZEC) and REF incentives for qualifying companies, but these are business regimes with substance, activity and authorisation requirements, not automatic personal expat tax breaks.
📋 Double Tax Treaties
Spain has a broad treaty network with 100+ jurisdictions. Canary Islands residents are Spanish tax residents for treaty purposes once they meet Spanish residence tests.
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