PROPERTY TAXES IN SPAIN

Property Taxes in Spain: Buying & Selling

Buying or selling property in Spain comes with specific tax obligations for both residents and non-residents. Understanding these taxes upfront helps you plan your budget and avoid surprises. This guide breaks down the main taxes and fees you need to know.

Taxes When Buying a Property

1. Transfer Tax (ITP) – For Resale Properties

  • Who pays: Buyer
  • Rate: Varies by region but in Andalusia it’s:
    • 8% on the first €400,000
    • 9% on €400,000 – €700,000
    • 10% above €700,000
  • Furniture: 4% if included in the sale
  • Notes: This is a one-time tax on resale properties (not new builds).

2. Value Added Tax (IVA) – For New Properties

  • Who pays: Buyer
  • Rate:
    • 10% for residential property
    • 21% for commercial property
  • Additional Tax: A stamp duty (Actos Jurídicos Documentados – AJD) of ~1–1.5% is also payable on new builds.

3. Legal and Administrative Fees

  • Lawyer Fees: ~1% of the purchase price
  • Notary and Land Registry Fees: ~1–1.5% combined
  • Other Costs: Surveys, utility transfers, bank fees

Taxes When Selling a Property

Whether you are a resident or non-resident, you may be liable for taxes on the capital gain (profit) from the sale plus local property taxes.

1. Capital Gains Tax (CGT)

  • Residents:
    • Taxed at 19–26% on the profit (depending on the amount)
    • 19% up to €6,000, 21% €6,001–€50,000, 23% €50,001–€200,000, 26% over €200,000
  • Non-Residents:
    • Flat rate of 24% on the profit (19% for EU/EEA residents)
  • Calculation: Selling price minus purchase price, minus allowable costs (renovations, fees, taxes paid at purchase).

2. Withholding Tax for Non-Residents

  • Rate: 3% of the gross sale price
  • Purpose: Paid by the buyer at completion and remitted to the Spanish Tax Office
  • Offset: This is credited against the final capital gains tax liability

3. Plusvalía Municipal (Local Property Appreciation Tax)

  • Who pays: Seller
  • Basis: Calculated on the increase in the cadastral value of the land
  • Rate: Varies by municipality
  • Note: This is separate from capital gains tax and must be paid even if you make no profit on the sale