It is very important to understand all the costs involved when buying or selling a property in Spain. In a good guideline you should allow a budget for purchase costs of approximately 10 to 12% on top of your agreed property price. This will cover any legal fees and extra expenses, below is a table that sets these costs out in more detail.
BUYER |
SELLER |
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Notary Fees (600-1000 euros)
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Agency Commission (3-6%) |
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Property Registration Costs (400-650 euros)
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Capital Gains Tax (Variable 19% – 23% for 2018) |
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Solicitor Fees (Usually 1%)
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Income Tax Provision (Retención) (3% applies to non-residents) |
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Property Transfer Tax (4-11%)
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Energy Certificate (100-500 euros) |
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Property Valuation Costs (If bank mortgage involved, approx. 800 euros)
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Plusvalia (100-500 euros) |
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For new build properties
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IVA (VAT 10%)
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IAJD (Stamp duty 0.5%-1.5%)
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Notary Fees
If you are buying a property in Spain then you will have to pay notary fees. The notary is an important professional with public function within the Spanish law system who certifies documents and makes sure that private agreements fulfil specific legal criteria.
The amount the notary charges is prescribed by law and depends on numerous factors such as value of the property, number of pages of Title Deed (Escritura) as well as attachments incorporated in the deed, and generally could be between 600 € and 1000 €. The Title Deed is inscribed at the Spanish Land Registry and the fee for this is usually around € 400, depending the exact amount on numerous factors.
Property Registry
It is normally a standard fee also based on the selling price in the deeds. These costs may vary depending on the municipality you live in and in most cases, it is between 400 and 650 euros.
Solicitor Fees.
It is strongly recommended that you choose an independent solicitor who is specialised in Spanish land law (urbanismo). Independent means that they work on your behalf only and are not also looking after the interests of the agent or developer. Fees are normally 1% of the selling price.
Property Valuation
The valuation of a property becomes a prerequisite when applying for a mortgage, this will cost the buyer 800 euros.
New Build Property
If you buy a brand new property directly from a developer, you will not pay the Transfer Tax, but a 10% VAT + 1,5% Stamp Duty, so the total tax will be 11,5%.
Capital Gains Tax
Capital gains is intended that you pay tax on the profit you make on a sale of a property.
The following are guidelines only.
Up to €6,000 – 19%, €6,001 – € 50,000 – 21%, over €50,000 – 23%.
If it is your habitual residence (for at least 3 years) and you are over 65 there is no capital gains to pay.
All official invoices relating to the purchase of the property, such as refurbishing, notary expenses, solicitor fees and estate agency fees can be deducted from the capital gains tax
Income Taxation rovision for non-residents - Retención → Seller
If the seller is not a Spanish resident he has to pay 3% income tax provision (retención) to cover any taxes resulting from the sale. However, the seller can claim for a refund if he believes that his tax liability is less than 3%.
Energy certificate → Seller
Spain has introduced a new law (Real Decreto 235/2013) obliging property owners to get energy efficiency certificates before they can sell or rent their homes, in line with other European countries.
For a sale, the seller must provide the buyer (at the notary) with an original copy of the certificate.The costs for such a certificate may vary on the size of the property and can be between 100 and 500 euros. The invoice for this certificate can also be deducted from the capital gains tax.
Plusvalía Tax
The plusvalía is a tax over the increase of the value of the ground the property is on. This is paid to the local town hall. The plusvalía is calculated on the basis of 3 factors: The period of ownership, the location of the property and the cadastral ground value.
The plusvalía tax can easily be requested at the town hall where the property is located.
By law, the plusvalía tax should be paid by the seller and it can be a substantial sum of money. Nevertheless, the plusvalía can be paid by the buyer if he has agreed to it.
Please note that the information is provided as a guide line and for general interest and is not given as legal or financial advice. Please consult legal authorities for up to date and accurate information.