Sale and purchase of real estate in Spain

Taxes related to the purchase of a property in Spain

23.06.2018

The purpose of this article is to answer the questions of our clients about the costs associated with buying property in Spain. In addition to the cost of a property, which will be prescribed in a notarized legal document on the transaction (Escritura), it will be necessary to pay about 13-14% of the total amount in taxes. These calculations are approximate and do not take into account the costs of financing (mortgage lending).
First of all, notary fees, since the transaction between the buyer and the seller or their official (having notarial power of attorney) representatives is in Spain at the notary. On average, this amount is from 1 to 1.5%.
After receiving the documents, you will have to pay the tax on the transfer of property, which is the most significant expense for home buyers in Spain. If you bought new housing from the developer, you would need to pay VAT (IVA) 10% of the cost specified in the contract of sale. The same thing happens with the secondary housing. It also will be 10%, although this amount can vary depending on a region. For example, in Barcelona and Valencia, 10% of the total purchase price is paid, in Madrid and Navar - 7%, in the Canaries - 6.5%.

Tax on transfer of ownership (ITP):

Autonomous Region of Spain ITP
Alava 6%
Andalucia 8%, 9%, 10%
Aragon 7%
Asturias 8%, 9%, 10%
Canary Islands 6.50%
Cantabria 8%, 10%
Castilla la Mancha 8%
Castile and Leon 7%
Catalonia 8%
Valencia 8%
Extremadura 8%, 10%, 11%
Galicia 7%
Rioja 7%
Madrid 7%
Navarre 7%
Basque Country 6%
Murcia 7%

 

Within 30 days after the transaction is paid a buyer has to fill in a special form of "Modelo 600" and register it in the Tax Inspectorate (Hacienda). After this, documents certified by the tax service should be provided to the Register of Property (Registro de la Propiedad), where they are registered and entered in the Cadastre. The cost is about 0.5%. For a foreigner, this is a rather complicated process, so a notary takes care of it for an additional fee, approximately 400-600 euros.

The payment of the municipal value-added tax (Plusvalía municipal), connected with changes in land prices, is paid by the seller in accordance with the law, unless the contract says the contrary. So be careful! The tax is small, but it is better to avoid unnecessary expenses.
The annual property tax (IBI) is imposed by the municipality in whose territory it is located. The tax rate varies depending on the region: 0.3-1.2% of the cadastral value of the property. It is always better to learn about it in advance from the seller.
If the owner of housing is not a resident of Spain, then he is obliged to pay tax annually for non-residents.

Payment of translations and certification of necessary documents.
I recommend you to hire a proffesional interpreter if the agency does not speak your native language. Insignificant expenses will save you from considerable trouble.

The services of our agency include full support of the transaction in your native language, starting with the selection of real estate and ending with the receipt of documents on the property. We also help to resolve household issues related to the purchase of housing in Barcelona, ​​and we offer trust management services for real estate.

If You have any doubts or questions about buying property in Spain, contact us by phone +34 938 328 094 or write us an email garantagency.office@gmail.com

We use cookies to ensure we give you the best experience on our website. If you continue, we'll assume that you are happy to receive all cookies on our website. Find out more about our cookie policy.