Does Spain tax US Social Security, 401(k)s and IRAs?
How the US-Spain tax treaty treats Social Security, 401(k), IRA, Roth, HSA, government pensions, dividends and interest for Americans living in Spain, and who gives the credit.
Updated · Expat Academy · Education, not advice
Once you're a Spanish tax resident, Spain taxes your worldwide income, and the US keeps taxing you as a citizen. The 1990 US-Spain treaty decides the credits.
Account by account
| Income | Spain | The US | In practice |
|---|---|---|---|
| Social Security | Taxes it | May also tax it | About the higher of the two; Spain credits the US source tax |
| 401(k), IRA, private pensions | Taxes it (only Spain under the treaty) | Taxes you as a citizen | Spain's tax; the US credits it |
| US government pensions | Exempt, counted for your rate | Taxes it | The US tax |
| Roth IRA | Not recognised | None | Spain's tax on what it taxes |
| HSA | Not recognised | None | Spain's tax |
| US dividends | Savings scale, 19% to 30% | Up to 15% as source country | Mostly Spain's |
| Interest, gains | Savings scale | Taxes you as a citizen | Spain's tax; the US credits it |
How Spain's rates work
Pensions, IRA money and Social Security are "work income": a flat €2,000 of expenses, a reduction for low incomes, then the state scale plus your region's scale. Combined rates start at about 19% and reach 45% (Madrid) to about 54% (Valencia) at the top. Interest, dividends and gains are taxed separately at 19% up to €6,000, then 21%, 23%, 27% and 30%.
The credits, both ways
Spain's tax agency says it credits only US tax charged on grounds other than citizenship: on Social Security, what the US would charge a non-citizen (30% of 85% of the benefit); on dividends, 15%. The US then credits Spain's remaining tax, because the treaty treats income it taxes only by citizenship as Spanish income for the credit. Item by item, you end up paying roughly the higher of the two countries' tax.
A worked example
A couple in Málaga (Andalusia) receive $36,000 of Social Security, $50,000 from their IRAs, $10,000 of dividends and $4,000 of interest. Spain's tax before credits is €18,310 ($20,507); after crediting the US tax on the Social Security, they pay Spain €16,736 ($18,744) and the US $1,763. In total they pay $20,507, against $4,874 if they lived in a US state without income tax.
What it means for planning
Because Spain taxes IRA money, Social Security and investment income on different scales, which account you draw from matters, and so does what you do before your first Spanish year begins. See tax planning before moving to Europe.
What the course adds
The Spain course takes this item by item for your own income: the Spain tax estimator shows each country's tax and credit on every line, in any of four regions; the account comparison shows what each account costs before and after the move and which pre-move moves pay; and the lessons cover wealth and inheritance tax, Modelo 720 and the yearly calendar.
Questions
Does Spain tax US Social Security?
Yes. Spain taxes it as your country of residence, and the US may tax it too. Spain credits the US tax charged on grounds other than citizenship (at most about 25.5% of the benefit), and the US credits Spain's remaining tax.
Are IRA and 401(k) withdrawals taxed in Spain?
Yes. Under the treaty private pensions are taxable only in the country of residence, so Spain taxes them at its general scale. The US taxes you anyway as a citizen and credits Spain's tax.
Does Spain recognise the Roth IRA?
No. Spain doesn't recognise the Roth's tax-free status. A cautious approach taxes the whole withdrawal as a pension; some advisers tax only the earnings.
Are US government pensions taxed in Spain?
Generally not. Pensions for work for a US government are taxed only in the US, though Spain counts them when setting your rate, unless you're a Spanish national.
Go deeper
- S4 Spanish income tax on your US income: Spain taxes residents on worldwide income: pensions, IRA money and US Social Security at the state scale plus your region's scale, and interest, dividends and gains at 19% to 30%. How it works, and why your region matters.
- S5 The US-Spain treaty: who credits what: Spain credits only the US tax it would let the US charge a non-citizen; the US credits the rest. Item by item, that means you pay about the higher of the two countries' tax on each kind of income.
- S6 Each account in Spain, and the moves to make before you go: In Spain the kind of account matters more than in the US: IRA money at the general scale, investment income at 19% to 30%, and no recognition of the Roth or the HSA. What each costs, and what to do while only the US taxes you.
Sources
- Convenio España-Estados Unidos, arts. 20, 21 and 24 (BOE-A-1990-30940)
- Agencia Tributaria, Rentas procedentes de Estados Unidos
- IRPF 2026 escala estatal y base del ahorro, guiafiscal.es
Education, not advice. This guide explains general rules as of the date above. Rules change every year; confirm your own situation with a qualified adviser in the US and in France.