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Spain’s 2025–2026 Income Tax Campaign is now underway, and while many people focus on the basics, experts say some of the most overlooked savings could come from insurance policies.

 

The campaign, which covers the 2025 tax year, opened for online submissions on Tuesday April 8 and runs until Monday June 30. Each year brings small changes, and for many taxpayers the process can feel overwhelming, especially when it comes to knowing what can and cannot be deducted.

 

According to comparison site Acierto.com, “insurance is one of the least known and most misapplied deductible expenses in income tax returns”, yet it can offer real savings if applied correctly.

 

This comes alongside a range of other tax deductions many residents may already be familiar with, including allowances for homeowners that can significantly reduce what you pay.

 

One of the most straightforward areas is car insurance, but only in specific cases. A 100% deduction may be possible when the vehicle is used for professional purposes. This includes transporting goods, visiting clients, giving driving lessons or carrying out commercial activities.

 

For most private drivers, however, this type of deduction does not apply, making it particularly relevant for the self-employed.

 

Health insurance is another area where savings may be available. It can be deducted if it is provided through an employer as part of a flexible benefits package, or if you are self-employed under the direct estimation system. In these cases, the cost must be declared correctly and supported with invoices.

The limits are clearly defined. Taxpayers can deduct up to €500 per person, rising to €1,500 for those with a disability. This can also include a spouse and children under 25 who meet income requirements.

 

Life insurance can also be claimed, but only in certain circumstances. The most common scenario is when it is linked to a mortgage on a main residence purchased before January 1, 2013. In this case, up to 15% of the amounts associated with the property may be deducted.

 

Self-employed workers may also include life insurance as a business-related expense, again with limits of €500 per person or €1,500 in cases of disability.

 

Some taxpayers may already be aware of additional allowances, such as deductions for supporting elderly relatives, which can also help reduce the final bill.

 

Home insurance follows similar rules. It is generally only deductible if tied to a mortgage taken out before January 1, 2013 on a primary residence. The maximum deduction in these cases is €1,356 per year. Self-employed individuals working from home may also deduct part of the premium, depending on how much of the property is used for business.

 

There are also smaller bonuses and incentives that can be easily missed if you are not aware of them, adding further opportunities to save.

 

Overall, while insurance may not be the first thing people think about when completing their tax return, it is clearly an area worth checking carefully. As Acierto.com highlights, understanding these lesser-known deductions could make a noticeable difference, particularly for those who are self-employed or have older mortgage arrangements.

 

 

 

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