The signing of the Deed of Sale is accompanied by some costs and
taxes apart from the price of acquisition. These are the costs of the notary, the registration of the
deeds, nonrecurring taxes and
others.
I. Costs of the notary and rates of the registration of the property, in
€:
|
Purchase price |
120.000
|
240.000
|
360.000
|
500.000
|
|
registration
fees |
280 |
410 |
420 |
450 |
|
Notary costs |
440 |
560 |
610 |
700 |
|
Total costs |
720
|
970
|
1.030
|
1.150
|
II. Nonrecurring taxes to the sale
1. Value added tax (VAT)
Real estate purchases are taxes with VAT or the tax over patrimonial
transmissions. The sale of properties of new construction is subject to
VAT. Sales that are made by companies or societies that dedicate
themselves to the sale, urbanism, the construction or reforms of urban
buildings are subject to VAT. For the purchase of urban property and flats
in properties, the rate of tax is 7%. In other properties, such as
commercial offices or land the rate of tax is 16%.
2. Tax over patrimonial transmissions
This nonrecurring tax especially affects all monetary transmissions of
property, if the VAT is not obligatory. For the acquisition of properties
in the Balearic Islands, the percentage of this tax is 7 % of the price
documented by notary, since 1 January 2000. The tax is payable within 30
days after the signing of the notarised deed. Late payments result in
substantial surcharges. For the payment of this tax it is necessary (for
non-Spanish nationals) to have a NIF, anyone who considers acquiring a
property in Spain, should obtain this Number of Fiscal Identification,
since the obtaining of the same generally takes up to four weeks.
3. Municipal taxes on the increase of the value of land and real estate
of urban nature
The tax on the increase of the value of land and real estate of urban
nature, also called capital gain, is a municipal tax. It is regulated in
articles 105-111 of law 39/1988 of the 28.12. law of regulation of local
taxes. With this tax the increase of the value of land and urban real
estate is charged from the last change of ownership of the property.
The amount of the tax depends on the value of the land and real
estate, the duration of the time of position and the number of inhabitants
of the municipality in which the property is located. The municipalities
can fiscalise / tax the increase of land and urban real estate considering
the limits of the law according to their tables of values. The more
time the building is property of the seller, the higher the capital
gains tax will be. It is calculated approximately at 3%. If a
building is sold in the first year of its acquisition it will not
pay capital gain tax. The payment of this tax according to art.102
of law 39/1988, falls to the seller, but in Spain this tax is
charged to the buyer. The tax must be paid within 30 days of the
notarisation of the deed. If the seller of a Spanish property is
taxable, he is subject to a contribution of 18 % of the difference
to the previous price of purchase and the present sale price. By the
18 % contribution from the non-resident seller (in Spain) of
the benefit obtained in the sale, the buyer takes responsibility with the
property acquired in 3 % of the purchase price registered before the tax
office. By this, the buyer would have to retain this amount and personally
pay it to the tax office. This is an advance payment of the IRPF tax of
the seller. With this legal regulation the Spanish state treasury wishes
to prevent foreigners from selling their only property in Spain and then
abandoning the country without paying the corresponding taxes. This
obligation does not exist, if the building in date 31.12.1996 has been
owned by the seller for more than ten years during which the value has
increased. This regulation is also not applicable should the property be
owned by a society (for example S.L). The tax must be paid within 30 days
of the notarisation of the deed.
II.
Periodic annual taxes
The possession of a Spanish property, even if it is for private use is
subject to obligatory annual contributions.
4. Taxes on real estate (IBI)
The tax of real estate, also called IBI is calculated based on the
registered value of the property and is paid annually to the
administration of the municipality (city council). On the receipt of the
IBI the registered value of the property appears as stipulated by the city
council. In the municipality of Calviá (southwest of Majorca), a rate of
0.78 % of the corresponding registered value of the property was
stipulated. Here it is necessary to consider, that the registered details
are revised every 10 years and that these values are approximately over a
third of the real value. Currently the registered values are far less than
the market values of the properties and occasionally the registered value
is only 50% of the real value.
