Rent my holiday flat as an individual or through a company? When an SL makes sense and when it does not

Short answer: both options are valid. The Junta de Andalucía registers the home in the name of an individual or a company (SL, SA), and Booking and Airbnb accept both as holder of the listing; we manage flats of both types and the day-to-day is identical. The difference is tax and paperwork: with one or two flats, staying as an individual almost always pays off; a company makes sense when you already have one (asset-holding, another business) or when there are several homes, employed staff and a real business activity. What follows are general criteria; the specific decision is for your accountant with your numbers.

What changes in the registration and on the platforms?

Nothing relevant. In the Junta's responsible declaration the holder of the operation can be an individual or a legal entity; if it is a company, its representative signs with a digital certificate and the deed or power of attorney is provided. On Booking and Airbnb the listing is opened with the company's tax number and bank account. In our portfolio there are flats in the names of individuals and flats in the names of companies, and all the companies already existed beforehand: nobody created one for the flat.

As an individual: how you are taxed

• If you only rent (even using a manager), the income is income from real estate capital in your IRPF: income minus deductible expenses, in proportion to the rented days, and the empty days impute income (Tax and the tourist home).
• Without the 60 % reduction, which is only for the tenant's main home.
• Tourist rental without hospitality services is VAT-exempt: you do not charge the guest VAT and you do not deduct the VAT you bear.
• You move to a business activity only if you provide hotel-type services (cleaning or linen change during the stay) or have a full-time employee for the management. Then you are taxed as self-employed, with IAE and, normally, 10 % VAT.

Through a company: how it is taxed

• The income goes to Corporate Income Tax at the general rate of 25 % (art. 29.1 of Law 27/2014). Expenses are deducted if they relate to the activity.
• When you want the money in your pocket, there is a second taxation: dividends or salary in your IRPF.
• Fixed obligations: bookkeeping, annual accounts filed at the Commercial Registry, Corporate Income Tax, VAT returns even if exempt, and an accountant who costs more than an individual's.
• If the company only has the flat and does not have at least one full-time employee to manage the rental, the tax office treats it as an asset-holding entity (art. 5 of Law 27/2014): it pays the full 25 %, cannot apply the 15 % rate for newly created companies or the incentives for small companies, and does not get the exemption on the sale of shares. That is the case of almost every "one-flat" SL.
• The VAT exemption is the same: without hospitality services, the company does not charge or deduct VAT either.

When does each one make sense?

What does not change with the legal form

The licence, the owners' association (three fifths), the flat's requirements, traveller registration, the waste charge and the manager's commission are the same for an individual and for a company. The company gives you no "legal" advantage for registering the home: it is only a tax and organisational decision.

An honest warning

This guide is written with the law in hand and with what we see among the owners we manage; it is pending review by an accountant, like all the guides on this topic. With your specific numbers (other income, marginal rate, number of flats, whether you already have a company) an accountant can tell you in half an hour which suits you. If you do not have one, we can point you in the right direction.