Costs when selling a property

The sales package

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Profit tax

Sellers must pay profit tax to Spain. This tax is applicable when the profit from the sale is higher than the tax paid in advance. The tax rate on the difference is 19-23% depending on whether you are a tax resident or not.

Exemption from capital gains tax

Resident home sellers from the age of 65 are exempt from capital gains tax provided they are tax residents of Spain and have been permanent residents of the property for over 3 years. The same also applies to resident sellers who are under 65 years of age, provided that they are resident in Spain and have been permanently resident in the property for more than 3 years, provided that the proceeds of the sale are invested in another permanent property in Spain within a maximum of 2 years after the sale was effected.

Capital gains tax

Capital gains tax is imposed on the sale of a property, based on the increase in value of the land on which the property stands. The basis for calculating the capital gains tax is the assessed value (valor catastral) as stated on the annual property tax (I.B.I.) receipt. The amount depends on the time of ownership and the area tariff determined by the tax authorities.

Withholding tax

For non-residents: if the seller is not a tax resident in Spain, the buyer and the notary public are obliged to retain 3% of the sale price, this amount being paid to the Spanish tax authorities. After the transfer, the seller can claim a refund from the tax authorities, provided that the seller is up-to-date with all his taxes and duties.

Deductions

All expenses related to the purchase and sale of the property are deductible, i.e. expenses for a real estate agent, lawyer, notary, accountant, architectural work, refurbishment, property registration, etc., provided original receipts must be presented.