Spain is one the most popular countries for foreigners buying houses and apartments in Europe. Spanish and foreign citizens pay annual real estate tax, wealth tax and income tax. Investors are charged capital gains tax and tax on rental income. Companies pay corporate tax
|Title transfer tax|
(including notary fees)
|Capital gains tax|
When buying property, the seller pays the agency fee and the buyer covers notary and registration fees
It is advisable to establish a company to purchase and own a commercial property since in this casу the owner can apply for refund of VAT within a month.
When buying property in a new residence, there is only 10% VAT. Land for construction and commercial property are charged 21% VAT.
There is also a stamp duty (Actos Jurídicos Documentados or AJD) which equals 1.5% for new residence buyers and 1.8% for commercial property buyers.
Property transfer tax (impuesto de transmisiones patrimoniales or ITP) is charged for
|Álava (Basque Country)||6.0|
|Biscay (Basque Country)||6.0|
|Cantabria||8.0 or 10.0|
|Castile and León||7.0|
|Extremadura||8.0, 10.0 or 11.0|
|Gipuzkoa (Basque Country)||7.0|
Capital gains tax (impuesto sobre la venta de inmuebles) is levied on the difference between acquisition and selling prices and ranges from 20% to 24% (in 2015). It is advisable to keep the electronic and paper copy records of all payments associated with it as tax deductions may be possible. From 2016, capital gains tax decrease
|Taxable amount, EUR||Rates, %|
Property sellers also pay tax on the increase in value of urban land (Impuesto sobre el incremento de valor de los terrenos de naturaleza urbana or IIVTNU). Its rate varies by municipality. This is how to calculate this tax, for example, in Barcelona:
|Tax period||4 years|
(11.2% in 4 years)
(=500,000 × 11.2%)
(€56,000 × 20%)
over 700,000 EUR
General income tax (impuesto sobre la renta) for residents in 2015
|Rate bands, EUR||Rates, %|
Property rental income
Occasionally income tax and wealth tax must be declared by more than one person. When real estate is registered to two or more owners, they are considered separate tax payers and must submit separate declarations even if they are married.
Real estate owners pay municipal real estate tax (impuesto sobre bienes inmuebles) which varies by region from 0.405% to 1.166% of the cadastral value. Payment schedules are also regional. As a general rule, the sum payable on Spanish real estate ranges from €200 to €800 per annum.
Corporate tax (impuesto sobre las utilidades de sociedades) is 25% for small and
Inheritance tax (impuesto de sucesiones) in Spain is taxed at 7.65% on the first €7,933 of the total amount and can reach 34% and more for inheritance over €797,555 (depending on the degree of relationship).
Disclaimer: the information in the above article is for reference and may be subject to change over time. Persons interested in exact calculations should contact a certified tax specialist in this country before purchasing property.
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