How taxes affect property transactions in Spain

Owning property in any foreign can be a rewarding investment, whether it’s a holiday home or a permanent residence – especially in sunny Spain. However, if you’re considering buying or selling a Spanish property, there are a few tax obligations that come hand in hand with owning a Spanish property, and it’s best to familiarise yourself with them before you start making movements.

If you’re a homeowner in Spain, whether you live there full-time or not, you’re required to pay certain taxes. These include annual property taxes, capital gains tax if you sell, and additional non-resident taxes if you don’t live in Spain. Since different kinds of taxes apply to different scenarios, it’s best to get help from an experienced conveyancing lawyer who can walk you through the process so you can rest assured that everything is handled correctly.

At Gascon Bernabeu, our English-speaking lawyers are here to guide you through the legal and financial aspects of buying and selling Spanish property. So, if you have plans to buy or sell our Spanish home, don’t hesitate to get in touch with our experts.

Here’s a quick overview of the taxes you should be aware of when buying and selling property in Spain.

The different taxes to consider when buying property in Spain

When purchasing a property in Spain, it’s easy to just think about the price of the home, but there are also taxes and fees that go along with it on top of the asking price, which you are responsible for paying (as the buyer). These additional costs can range anywhere from 8% to 11.5% of the property’s value, depending on whether you’re buying a new home or a resale. Factoring these expenses into your budget will help save you a headache further down the line.

Here’s a quick breakdown of the main taxes you can expect:

• New-build properties. Subject to 10% VAT (IVA) plus 1.5% stamp duty (AJD).
• Resale properties. Instead of VAT, you’ll pay a Property Transfer Tax (ITP). Like many things in Spain, this rate varies by region but generally ranges between 6% and 10%.

Other costs you’ll incur when buying property include notary fees, land registry fees, and potential legal fees if you bring on the help of an expert like our English-speaking solicitors here at Gascon Bernabeu. It’s also worth checking for any outstanding debts tied to the property, as these could become your responsibility after purchase, even if they aren’t historically yours.

What taxes apply when you sell property in Spain?

If you’re thinking about selling your property in Spain, there are a couple of important taxes you should know about. The first one is called Capital Gains Tax (CGT). This tax is applied to any profit you make when you sell your property. The amount you pay in tax depends on where you live. If you’re a resident of a European country or part of the European Economic Area (EEA), the tax rate is 19%. If you are from a country outside of these areas, the rate is 24%. However, some situations could help lower the amount of tax you have to pay. For example, if you use the money from your sale to buy a new primary home in Spain, you might qualify for some exemptions that can reduce your tax bill.

The second tax is the Plusvalía Tax. This is a local tax that you have to pay when you sell a property in Spain, and it’s based on how much the value of the land has gone up while you owned it. Each municipality has its own way of figuring out this tax, so the amount you’ll owe will depend on where your property is located. After you sell your property, you’ll need to pay this tax to the local government. It’s a good idea to check with your local officials to get clear information on how the tax is calculated and how to pay it, as the rules can change from one place to another. If you’d prefer, you can get in touch with our expert team of English-speaking lawyers, and we’ll help you make sure your property sale is compliant with all facets of Spanish law.

When to consult a lawyer to help with Spanish property taxes

Spanish property taxes and legal procedures can be notoriously complex, especially if you’re unfamiliar with the local laws, or you’re managing matters from abroad. Getting professional legal representation is the best way to ensure you avoid unnecessary penalties for missed taxes you were unaware you even had to pay.

At Gascon Bernabeu, we specialise in guiding international clients through every aspect of Spanish property law. Whether you’re buying or selling a property, managing inherited or gifted property, or navigating non-resident tax obligations, our English-speaking lawyers are here to offer clear, reliable advice and practical support every step of the way.

If you would like to read more about our Spanish conveyancing services, you can head to the conveyancing page for more in-depth details on the process and our services.

Our friendly English-speaking team is here to help you with buying or selling property in Spain, including understanding any tax responsibilities you may have. If you would like to speak with one of our lawyers, feel free to get in touch. We offer free, no-obligation consultations, where you can talk about your situation without any pressure to make a decision.

You can reach our Spanish property lawyers via the form on our website, email us at info@gbabogados.co.uk, send a message through WhatsApp, or call us directly at +44 (0)20 3137 1320. We’re here to help.