Taxes to consider when buying
Below are the Spanish taxes you can expect to consider when buying a property in Spain and the ongoing taxation costs whether you undertake or do not undertake activity if you are to remain a non resident. In Spain each Autonomos region can have its own purchase tax strategy so purchase taxes will vary depending on where you buy and what price you are buying at. Each region may also apply different rates for other taxes like Inheritance or stamp duty on new builds. The charts below show what purchase taxes apply when buying in Spain and what other longer term taxes you might be liable for.
Purchase taxes for resale properties (excluding garages)
Sliding scale. 8% for first € 400k, 9% up to € 700k and 10% on everything thereafter
Sliding scale. 8% for first € 400k, 9% up to € 600k and 10% on everything thereafter
Catalonia and Valencia
All other regions
IVA New builds Spain as from Jan 2013
Mainland Spain and the Balearics 10%
IGIC New Builds Spain
Stamp Duty New builds Spain
From 1% to 1.25% depending on region
Inheritance tax Bands in Spain first death
Please note there is no spousal exemption on an asset held in Spain. Rates may vary based on dependents relationship to deceased. Spanish inheritance rules »
For detailed advice and guidance on your exact situation contact us today.
Capital Gains Tax Spain
Capital gains for non residents or second home owners in Spain is charged at a flat rate of 21%. Buying costs and certain other costs can be offset before capital Gains are applied, for further information contact us today. If you are non resident of Spain at sale the Notary will deduct 3% of the sale price as tax on account. It is important your Lawyer ensures you understand your current and future tax position when you buy and as part of the legal service being provided.
Yearly wealth tax for non residents of Spain
Only applicable for assets with a net value above € 700k tax band range 0.2% to 2.5% of value of asset.
Income tax and when it is payable for non fiscal residents of Spain.
Rental income or other income generated in Spain by a non Spanish tax payer is payable at a flat rate of 24.75% ( as of 2013). It is payable on net rental income after expenses have been offset which can include the interest on any mortgage payments. For properties partly let for the year the tax office will allow costs be offset as a proportion of the year the rentals take place.
For owners who do not rent the property out and have bought in a company structure the income tax bracket is still payable at 24.75%. Tax is payable based on 1.1% of the registered Cadastral value of the property owned. Where a property is bought in a company the tax office assumes it is a commercial venture and requires income tax is paid whether any is generated or not.
If the company that owns the property is based outside Spain,and the beneficiary wishes to remain anonymous the Spanish authorities will apply a flat taxation of 3% of the Cadastral value payable each year for the benefit of doing so. These extra costs needs to be considered when looking at ownership structures For more information on renting out your property contact us or go to Renting in Spain page »
Non resident yearly tax and IBI
Each year, (even if you are not fiscally resident in Spain), if you own a property you will liable for “Impuesto de la renta de no residentes”. This tax is payable by everyone by June of each year and is a flat 24% of either 2% of the Cadastral value of the property or 1.1% of the Cadastral value if the value has been increased since 1994. The Cadastral value is also the basis for calculating IBI ( council tax), rates for IBI will vary from region to region. Percentage rates range from 0.40% to 1.166%. The exact ongoing taxation costs can be calculated by the Spanish legal adviser once the Cadastral value has been ascertained.