Tax and Expenses
WHEN YOU BUY A PROPERTY:There is tax to be paid on the conveyance. There are expenses that must be paid to the notary office and property register.
The tax payable will depend on the type of property you buy and where it is located (the different autonomous regions may have different laws with regard to the applicable tax rates):
ON THE PURCHASE OF NEW PROPERTIES:
- VAT (Value Added Tax), at a fixed rate of 10% of the declared value of the property.
- A.J.D. (Stamp Duty), this tax is in addition to the above-mentioned VAT and is calculated at a rate of:
- 1.5% for properties located in the Valencia Autonomous Region and Andalusia.
- 2% of the declared value for properties located in the Region of Murcia.
ON RESALES:I.T.P. Property Transfer Tax, at a rate of:
- 8% of the declared value of the property for properties located in Murcia.
- 8% of the declared value of the property for properties located in Andalusia and with a price of up to 400,000 euros. The highest values will be taxed at a higher rate.
WHEN YOU ARE ALREADY THE OWNERAs non-resident owner of a property in Spain you should remember you have the obligation to pay certain taxes in this country.
Income Tax (I.R.P.F.): This tax is around 0.15% of the value of the property and is paid yearly, corresponding to the previous calendar year. Consequently if your property has a rateable (cadastral) value of 100,000 euros, the amount you would have to pay each year would be 150 euros.
The local property ownership tax (I.B.I.): This is a direct tax on the base value of the home.