A property deed here in Spain is referred to as the Escritura and you will need the services of a Notary (Notario) to provide you with this document.
A property deed here in Spain is referred to as the Escritura and you will need the services of a Notary (Notario) to provide you with this document. As a guide cost for this service on a property costing 100,000€ you could expect to pay around 700€ for property exceeding a buying price of 100,000€ the figure is calculated by percentage and is normally levied at 1%. Formalisation of deeds any tax payments and mortgage requirements that may need to be actioned can be via the services of a Gestoria or via a Solicitor again 1% of the property value is an approximate cost.
Property Registry costs
It is the responsibility of the buyer to have the property purchased entered into the Property Register. This is a standard fee again based on the selling price recorded in the Escritura. This figure as a guide is around 500€ to 600€ and may vary depending on which autonomous region of Spain you decide to buy in.
New Build properties and Re-sale Properties.
New build property when purchased is subject to VAT (IVA) at 10% however a re-sale property is not. A re-sale property purchase is subject to the property transfer tax again it varies from one autonomous region to the next as a guide and depending on property value it can be anything between 7-10%. It is worth noting that new build properties are not subject to the property transfer tax but they are subject to Spanish IAJD Impuesto sobre Actos Jurídicos Documentados. This cost when buying property is a tax that applies to all acts formalized in public documents. The general rate is between 0.5% and 1.5% depending on the Spanish autonomous community where the property is located.
Estate Agency Commission.
When a property is sold using an estate agent there will be a commission fee. Here in Spain this is normally around 5% of the sale price and it can be offset against the capital gains tax.
It is not unusual in Spain for a seller to use more than one estate agent to market and sell their property. So as a seller it makes good sense to know what services your estate agent is going to provide e.g. Legal services, insurance services, currency transfers, bank and utility services and provision of NIE numbers. You can opt for using one single estate agent exclusively and they may offer a smaller commission fee for this.
Capital Gains Tax
Currently capital gains tax rates are:
19% for the first 6.000 euros
21% from 6.000 and 50.000 euros
23% from 50.000 onwards
For example if the seller bought a house in 2006 for 100.000€ and in 2020 sells it for 220.000€ there is a capital gains tax payment due on 120.000€ broken down as follows:
19% for the first 6.000 (6.000 x 0.19) + (50.000 x 0.21) + (64.000 x 0.23) = 1.140 + 10.500 + 14.720 = 26.360 euros.
However should the seller be over 65 years of age and having resided officially in the property for over three years capital gains tax is not due.
All fees and costs for legal and other professional services can be offset against the amount of capital gains tax due. This includes official receipts for any refurbishments works carried out at the property and Energy Performance Certificates.
Non – residents tax - Retencion
Should the person selling the property be (for tax purposes) classed as a non-resident 3% of the purchase price must be retained by the buyer to be paid to the tax office. The seller can claim for a refund if he can prove his tax liability is lower than 3%.
The plusvalía is a tax that relates to the increase in 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 sizeable sum of money. However the plusvalía can be paid by the buyer should agreement be reached.
It is advisable to use a Specialist Foreign Exchange service when making payments to complete the property purchase. A currency specialist can guide you through the process giving safe, fast and secure delivery of funds. Not to mention a better rate than the average bank a major factor when transferring large amounts of currency.
The benefits of Currency Exchange Specialists will be covered separately.
Energy Performance Certificates – EPC.
Information regarding EPC documentation can be found in the Royal Decree 235/2013 5th April 2013. It is compulsory for all property owners in Spain who wish to sell or rent out all or part of their property to have an EPC. Costs for these certificates vary between €100 to €500 depending on position, size, condition and location of the property. An EPC can only be issued by Architects, architectural technicians or recognised engineers. In some circumstances there are exceptions for certain buildings.
Our multi-lingual and English speaking Architectural partner Pacheco & Asociados are able to provide these documents in English for the client and carry out the registration required by the autonomos authorities. More information and other architectural services provided along with relevant topics can be found at: www.spanisharchitect.info
Or you can call 0034 868 042 442.
If any further information or assistance is required our team are always happy to assist.
You can call us on 0034 722 277 422 or by email at: email@example.com
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Our published elements are sourced from reliable third party professional bodies and institutions along with input from our highly professional team.
These elements are for guidance purposes and are subject to change. Come to Spain Group does not control or own any of the factors or external sources for the information provided. Therefore as accurate as the information is at the time it is purely for guidance purposes and any projections assumptions or estimates therein cannot represent every individual circumstance and we recommend that if needed professional legal advice is sought.