Tax rates in Spain of Property Purchase and sale apply - Updates valid since 2021!
The following tax rates in Spain of Property Purchase and sale apply:
1. IVA - VAT: on the purchase of new built properties:
The VAT on the purchase of a newly built house or flat and associated garage / parking space by a constructor (promoter) is 10 %. There is as well a stamp duty of 1.2%.
2. Capital gains tax:
Who sells as non Resident a property in Spain will pay the difference in value compared to the time of its purchase price from 2016 of 19 % capital gains tax. Here, however, the costs are taken into account to improve value from the date of acquisition. Specific regulations apply to the extent and for the acquisition of facts that occurred before 1994.
If the seller is not resident in Spain the purchaser has the obligation to retain 3% of the purchase price at the signing of the deed of sale and purchase and pay it to the Spanish Tax Office as payment on account of the vendor's capital gains tax. This amount will be credited to the final tax. If the amount of the 3 % is higher than the final tax amount, the seller is entitled to a refund.
3. ITP -transmission tax:
The real estate transfer tax on the purchase of real estate that accrues on the sale by private individuals or resale is calculated in Andalusia from 28.4.2021 as follows: For villas / apartments and plots they are fully taxed at 7%, regardless of the amount.
4. -Tax on the increase of value of urban plots - Plusvalía:
The tax on the increase of value of urban plots, also known as Plusvalía-tax, your lawyer needs to check with the respective community. This is paid by the seller. If he is not resident, the buyer is liable!
The Plusvalía tax is waived if you can prove that the property was sold with a loss.
5. VAT – general VAT rate:
The general VAT rate is 21 %. This is the case for building plots, commercial locals and common services in which the seller is an entrepreneur.
6. Commercial rental:
For commercial rentals is the retention, to which the tenant is obligated against the Spanish treasury in favour of the tax account of the landlord, since July 2015 19 %. The tenant has to pass that amount (retención) with the form “Modelo 115” directly to the tax agency.
7. Inheritance tax exemption:
In Andalusia, the inheritance tax exemption for inheritance to spouses and descendants has been increased to € 1,000,000, provided that the estate of the heir in Spain before the inheritance is not more than € 1,000,000.00.
¡Check with your attorney for precise information in your own case!
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