Frequently asked questions about buying and selling in Spain

WHAT taxes do I have to pay when selling a property in Spain?

In Spain, the vendor must pay the Plusvalia municipal (increase in value of urban land) and the Capital Gains Tax (difference between the acquisition value and the transfer value). However, when the vendor is NOT a tax resident in Spain, both taxes present a series of specialities.

What happens with the Plusvalía Tax when the vendor is Non­Resident?

Usually, the person liable to pay the Municipal Capital Gains Tax is the vendor. However, when the vendor is Non­resident, substitute taxpayer for the taxpayer (Art. 106.2 TRLHL). In other words, the obligation to pay the Plusvalia corresponds to the buyer. For this reason, the buyer usually withholds the amount of the Plusvalia from the sale price in order to pay it directly.

Is there any difference between the Capital Gains Tax of Residents in Spain and NonResidents?

Yes. On the one hand, residents in Spain will declare the gain in their Income Tax Return for the following year. However, Non­Residents must present their declaration within four months after signing of the deed of sale. Another difference is the tax rate applicable to each one. Residents pay between 19 per cent and 28 per cent. Non­residents are taxed at a flat rate of 19 per cent.

In addition to the above, when the seller is a Non­Resident, the buyer is obliged by Law to withhold 3 per cent of the price and pay it to the Tax Office.

What about the Property Tax

(IBI) and the rubbish bill?

It is common for buyer and seller to agree that these taxes are paid proportionally, according to the number of days that each one has been owner. Although it depends on each town hall, the IBI is usually paid at the end of the year (September­October) and the rubbish collection at the beginning of the year.

What happens with the Land Registry and the Cadastre? Do they always coincide?

It is usual for the Cadastre records and the Land Registry not to coincide, as they are different registers. The Cadastre is a purely administrative register, that indicates the location of the property, metres, etc. And it is used to calculate taxes such as IBI. The Land Registry, on the other hand, is a register of rights.

It indicates who is the owner, if there is any charge, mortgage, etc. When selling or buying a property it is very important to check both, to know the exact legal situation of the property.

What does the cédula of habitability or occupation licence consist of?

The regulation of the cédula de habitability or occupation licence was modified by Decree 12/2021 of 22 January, which introduced the so­called ‘responsible declaration’. This is a very important document in sales and purchases; and can be a source of disagreement between buyers and sellers. You can find more information on our website.

Offer, reservation contract, earnest money, purchase contract ­ what is the difference between them?

From the moment buyers or vendors sign a document, both assume legal obligations that they may not be aware of. At White­Baos Abogados we al­ ways recommend that no document (offer, reservation, deposit) should be signed without first being reviewed by a lawyer.

What about the sales authorisation that is usually signed with Real Estate Agencies?

It is advisable to indicate in the sales authorisation or mandate that the Agency will only receive its fees in the event that the sale is 100 per cent completed at the Notary’s office. Likewise, it is always recommended that the agency does not directly receive the deposit paid by the buyer, and that the seller himself signs the contracts with the buyers directly, by him or herself.

Who pays the Notary and Registry fees?

According to art. 1455 of the Spanish Civil Code, the costs of the first copy will be paid by the seller, and the rest will be paid by the buyer. But depending on the area, other customs may apply. For example, in the Marina Alta, the Notary fees are usually paid by the buyer. The costs of registering the change of ownership in the Land Registry will be paid by the buyer.

Dream jobs

A BRAND­NEW study completed by global financial service, Remitly, has revealed the most sought­after job in each country. And Spain’s most popular dream job might be a surprise to some.

In the report, Spain was the only European country to record an online role as the most popular dream job, with ‘online influencer’ being the top pick. By contrast, traditional jobs like ‘lawyer’, ‘firefighter’ or ‘teacher’ were the most popular dream jobs in most European countries.

The most popular dream job worldwide was ‘pilot’ with more than a million searches, followed by writer which saw more than 800,000 searches.