We offer you the necessary legal advice

Buying a property in spain:

If you have decided to buy a property in Spain, it is advisable that you engage a lawyer with expertise in this area to assist you with the purchase process.

Certain formalities are necessary when buying a property. Due Diligence consists on verifying the registration in the Land Registry Office, obtaining NIE (Foreigner Identification Number) for non-resident purchasers, drafting and exchanging  private agreements, coordinating payments, checking possible outstanding  taxes, community fees utilities, etc.  The transfer of a property is completed by signing a Title Deed in front of the Public Notary.

After completion, the buyer must pay taxes in order to proceed with the registration of the Property in his name in the Land Registry Office.

Further assistance can be provided to engage utilities for the acquired property and to open a Spanish Bank Account for setting direct debits.

Tax Obligations and other expenses for the Non-Resident owner of property in Spain:

– Impuesto Bienes Inmuebles (IBI). Council tax. This is a property tax paid annually to the Town Hall of the municipality where the property is situated.

– Tasa de Residuos Sólidos: (Garbage collection tax). This tax is also paid annually to the Town Hall of the municipality where the property is situated.

– Community Fees: If your property forms part of a Community of Owners (condominium) you will need to pay fees to contribute for the expense of maintenance and cleaning of communal areas (green areas, pool, interior of the building….), insurance, management and so on.

– Non-Resident Tax: This is a compulsory tax paid annually by non-residents to the Spanish Tax Authorities. Owning a property implies the submission of this tax, regardless of whether the Owner rents out the property or not. This is known as “presumed income”.

Selling a property:

Selling a property in Spain by a Non-Resident similarly requires as well the legal advice by a solicitor experienced in conveyancing.

A private agreement must be signed by vendors and buyers and a down payment simultaneously received to put the property out of market. A completion date to transfer the property will be fixed in such agreement. On completion, the seller will receive the balance of the sales price and the buyer formally will become owner when title deed is signed before the Notary Public and keys are handed over.

Tax liabilities for a non resident vendor  

– Plusvalia Tax: This local tax is calculated by taking into account the difference between the land valuation at the time of acquisition and the time of sale.

– Capital Gains Tax: All Non-Residents transferring a property in Spain are obliged to be retained a 3% of the sales price (Withholding tax on account of the eventual Capital Gain Tax). After calculations this 3% will be settled depending if the result is a lose or a profit.

Wills

If you are non-resident or expat living in Spain it is strongly recommended that you sign a will before the Spanish Notary.

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