Re-sale
purchase tax: House buyers of re-sale property (as opposed to brand new) are
required to pay the Impuesto de Transferencia de Propiedad - Transfer Tax
- which is now 7%
New Properties purchase tax:
buyers of brand new houses in Spain are liable to paying 7% IVA (VAT) if
the house is finished or is being built at the time of the purchase, plus an extra
0.5% stamp duty. However, if you buy land
in Spain, commercial premises or parking spaces in garages, then the VAT
payable rises to 16%.
Increased patrimony tax
payable to Spanish Treasury: When a property sale in Spain takes place, a
capital gains tax must be paid by the seller. According to Spanish fiscal law,
the buyer withholds 5% of the total purchase price to make sure that the seller
does not take the money and run.This amount represents a capital gains tax on
the profit made by the seller at the time of the sale. That is the difference
between the current (official) sale price and the price paid by seller
when he/she originally purchased the property + the value of any reforms and improvements
carried out since then
The capital gains
tax is payable to the Spanish Treasury (Tesoro Público) and is 5% the said
difference for for non residents and 3% for residents - but this is only the advanced
diposit. The estimated amount retained at the moment of the sale is payable once
everthing has been presented to the local registry and the new deeds are available.
This means that property sellers not living in Spain will have to arrange for
their lawyer or gestoría to see to the necessary paperwork and to formalise
the full tax payment a few months after the sale. The final amount could be as
much as 30% the profit you make on your sale, so if there is a very big difference
between the price you are selling for and the price you originally paid, it might
be worth applying for residency before you sell (nationals of EU member states
are automatically granted residency, although the paperwork can be a bit tedious)
in order to be elegible for the reduced percentage for residentes. Please note
also that you need a NIE to pay this tax. Any
seller who is over 65 and has been a legal resident in Spain for the last three
years does not have to pay this tax. Residents and non-residents who purchased
the property they are now selling before December 1986 are also exempt from the
capital gains tax.
Plusvalía
Tax: The local authorities determine the amount of plusvalía to
be paid for each purchase of property in Spain, depending on the area where the
property is located
When
buying a house in Spain it is important to estimate the taxes you will have to
pay, not only when you actually purchase your Spanish property, but also local
taxes and housing rates which are paid on a yearly basis by all home owners in
Spain. Spanish housing yearly rates depend on the value of the house and the area
it is in, but here is a rough guide to all the tax expenses you will need to take
into account when deciding what house to buy