Taxes and charges in Spain when buying a second hand real estate
When buying a second hand real estate in Spain, the following taxes and fees apply:
- Basic income tax or transfer tax in the amount of 7% of the purchase price. 6% in Madrid, 6.5% in the Canary Islands, 10% in the coast of the Costa Blanca.
- Notary fees and land register entry are dependent on the price. Notary fees are normally about 0,5%-1% of the purchase price.
In Spain it was customary that under-securitized, so in the notarial purchase contract is stated a lower price than actually paid. Of course it is forbidden that prohibition hindered but no one.
However, it must be borne in mind that Spain's fiscal services will continue to compare the price determined in the purchase contract and the price according to the cadastre. If a difference is found, the Spanish government will send you an invoice for this difference.
- Land register entry approx. 0,5%-1% of the notional purchase price.
- Registration of electricity, water and garbage collection about 200 Euro through a real estate broker or tax consultant.
- Procurement of the Spanish foreigner identification number N.I.E. about 100 euros.
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Summary additional costs in Spain for real estate purchase
So the official total cost of buying a property in Spain is about 12% in Costa Blanca.
Further costs incurred after buying property in Spain
Property Tax (Impuesto sobre Bienes Inmuebles or IBI)
This property tax, IBI, is payable annually, generally in the autumn, and is calculated on the basis of the cadastral value or the land value used by the Spanish tax office. The cadastral rating takes into account both the value of the land and the value of the building, depending on the type, location and use.
As a rule, payment of this tax for the current year lies within the responsibility of the seller of real estate in Spain.
Sometimes, if the deal is set up earlier than autumn, the money on the payment of the current tax is reserved by the broker from the sum that the buyer has received.