If you are living and working in Spain, you will be liable to pay taxes in Spain on your income and assets and will need to file a Spanish tax return. Whether you pay Spanish taxes on your worldwide income, or Spanish-based income only, depends on your residency status.
If you are classed an official resident in Spain you will be subject to Spanish tax on your worldwide income, calculated on a progressive scale, although tax deductions exist. If you are a non-resident in Spain you will only pay tax in Spain on Spanish income – typically at a flat rate – which also includes potential income on Spanish property even if you don’t rent out your property. Spanish tax is also applied to property ownership, investment interest and goods and services (VAT) in Spain.