Madrid short-term rental rules: VUT licences, Plan RESIDE, and the crackdown on illegal flats

Madrid's short-term rental rules are deceptively layered. There's a regional licence regime that, on its own, isn't especially hard to satisfy — and a City of Madrid planning regime sitting on top of it that, in the central districts, has become close to prohibitive. Plenty of operators satisfy one and assume they've satisfied both. They haven't, and the city has spent 2025 making that expensive.

This guide separates the two layers, explains the 2025 Plan RESIDE that reshaped the city rules, and covers tax, community consent and penalties.

Is short-term renting legal in Madrid?

Yes — but a legal tourist flat in the municipality of Madrid has to clear two independent approvals: a regional tourism registration and a municipal urban-planning licence. The relevant figure is the VUT (vivienda de uso turístico): a whole dwelling marketed for tourist stays.

Layer one: the regional VUT registration

The Comunidad de Madrid regulates VUTs under Decreto 79/2014, amended by Decreto 29/2019 (in force April 2019). To operate, you file a declaración responsable de inicio de actividad, register in the regional Registro de Empresas Turísticas, and obtain a CIVUT — the certificado de idoneidad para vivienda de uso turístico, a technical certificate confirming the dwelling meets habitability and safety standards (heating, hot and cold water, direct exterior ventilation, a fire extinguisher, emergency-exit signage and a displayed evacuation plan).

On its own, this layer is achievable. The difficulty is the second layer.

Layer two: the City of Madrid planning regime — Plan RESIDE

A VUT in the municipality of Madrid also needs an urban-planning licence treating the use as terciario hospedaje (tertiary lodging). This is where most operators come unstuck.

The old Plan Especial de Hospedaje (2019) already restricted tourist flats heavily in the central districts, including a requirement for independent access from the street — no shared portal, stairs or lift with residential neighbours. In 2025 it was replaced by Plan RESIDE, definitively approved in August 2025, which goes further:

• In the historic centre, dispersed tourist flats in residential buildings are prohibited — even on the ground floor. Tourist use is only viable in a building given over entirely to it.
• Outside the historic centre, a VUT in a mixed or residential building is allowed only with independent street access and only on the ground or first floor.
• Existing legal licences granted before Plan RESIDE may continue, provided they comply with current sectoral rules.

The practical effect: opening a new dispersed tourist flat in central Madrid is essentially closed. Anything you acquire there needs its licences verified against the current plan, not the one that applied when it was set up.

The crackdown is real, and it has numbers

This isn't theoretical enforcement. Reporting in 2025 put roughly 16,000 advertised tourist flats against barely 1,100 municipal licences — meaning the large majority operate illegally. In 2025 the city reported recovering 323 illegal VUTs for residential use, issuing 315 cessation orders, and imposing 117 sanctions, most of them at €30,000. If you're buying into Madrid, assume a listing's legality has to be proven, not presumed.

The national registration number — what changed in 2026

As elsewhere in Spain, the national single rental number (NRA) under Royal Decree 1312/2024 was mandatory from 1 July 2025 — and then the Supreme Court annulled the registration procedure in May 2026, ruling it intruded on regional competence (we cover the annulment of the national registry separately). The single-window data function survives; the mandatory national number does not. Madrid's regional registration is the one that governs. Confirm the current platform requirement before listing.

The rules that catch operators out

• Two approvals, not one. A regional registration without the municipal licence is not a legal VUT in the city.
• Independent street access. The defining condition for a VUT sharing a building with residents outside the historic centre — and a flat outright bar in the centre.
• The "tourist use vs lease" line. A VUT is a whole dwelling let for short tourist stays and cannot be used as a permanent residence. Let the same tenant for a longer period and you move into a temporary lease (arrendamiento de temporada) under the rental law (LAU) — a different regime with different rules.
• Community consent. Since 3 April 2025, a new VUT needs the community of owners' express approval by a three-fifths majority.
• Safety standards. The CIVUT items are checked, not assumed.

Tax: no tourist tax, but income tax and VAT still apply

Tourist tax: none. As of 2026 neither the City of Madrid nor the region levies a tourist or overnight tax, and the regional government has said it won't. This genuinely sets Madrid apart from Catalonia, the Balearics and Valencia's region — budget guest pricing accordingly, but don't assume it's permanent.

Income tax. Rental income is taxable under IRPF for residents and IRNR for non-residents (19% for EU/EEA residents, 24% for others). The reduction available for long-term housing leases does not apply to tourist lets.

VAT (IVA). A VUT let without hotel-type services is VAT-exempt. Provide hotel-type services (cleaning during the stay, linen changes, reception, meals) and it becomes a lodging service taxed at the reduced 10% rate.

What's changing — the timeline

• Apr 2019 — Decreto 29/2019 amends the regional VUT rules; the city's Plan Especial de Hospedaje takes effect.
• Dec 2024 — Royal Decree 1312/2024 creates the national NRA and single window.
• Apr 2025 — Horizontal Property Law reform: new VUTs need three-fifths community approval; default flips to "not allowed unless authorised" (not retroactive).
• Jul 2025 — national NRA becomes mandatory.
• Aug 2025 — Plan RESIDE definitively approved: dispersed VUTs banned in residential buildings in the historic centre.
• May 2026 — Supreme Court annuls the national registration procedure.

A practical compliance checklist

• Verify both the regional registration and the municipal urban-planning licence — confirm each against current rules.
• Check the property against Plan RESIDE: historic centre vs rest of city, independent access, ground/first floor.
• Confirm the CIVUT suitability certificate is in place and current.
• For new activity, secure the community of owners' three-fifths approval.
• Keep guest registration and the safety items (extinguisher, signage, evacuation plan) in order.
• Account for income tax and VAT correctly; no tourist tax to collect in Madrid.
• Watch the post-2026 position on the registration number platforms require.

Keeping two regimes straight across a portfolio

Madrid punishes the gap between "I have a licence" and "I have the right licences." For a manager, the real work is tracking, per property, which approvals exist, when they expire, whether the unit complies with the current plan, and whether community consent is on file — and doing it across a portfolio without anything falling through. That operational record-keeping is what Recal centralises, so the difference between a registration and a full, current set of approvals never gets lost in an inbox.

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Last reviewed: June 2026. This guide is general information for property managers, not legal or tax advice, and Madrid's short-term rental rules — especially Plan RESIDE and the position on the national registry — are changing quickly. Confirm the current position with the Ayuntamiento de Madrid, the Comunidad de Madrid and a qualified local adviser before acting. For Spain's national picture, see our piece on the annulled national registry.