What are the taxes for a property purchase in Spain?

Whether new or old, the purchase of real estate in Spain requires the payment of many taxes which it is impossible to derogate from. The different legislations according to the 17 autonomous communities of the country of Cervantès, each managing its own real estate taxation; in fact, the total costs weighing on the buyer will vary from 8% to 15% of the value of the desired good. Let's see in detail which one it is.

If you buy an old property ...

The heaviest tax you will have to bear will be the Property Transfer Tax , abbreviated as ITP. Its management being conceded to the Spanish autonomies, its rate will fluctuate from east to west and from north to south: it ranges from 6% of the price of the property - in the Madrid region - to 11% in the Balearic Islands. But rest assured: on the one hand, special cases exist; on the other hand, in the majority of regions, a reduction is granted to a wide range of social classes . For example, in Catalonia, for young people under 33 whose annual income is less than € 30,000, or for large families with low earnings, the ITP is reduced to 5%.

In any case, the best thing to do is to consult the autonomy legislation in which you plan to settle for more information.

If you buy a new real estate property …

… VAT is included in your expenses…

This time, you will not pay ITP, but will have to pay VAT . Generally, it fluctuates around a value equal to 10% of the purchase price. However, like the ITP, exceptions punctuate its legislation: for example, low-cost housing financed by the state will not exceed a VAT of 4%.

… Just like additional charges

These are costs relating to the water, electricity and gas connections on your land, as well as the installation of the electric meter which you will be forced, as a buyer, to pay.

Notarial fees

The Spanish notary

He has a very different role from the French notary. Representing the State, he will only ensure the proper drafting of the act of sale of the property. He will also verify that the purchase price of the property is paid to the seller, and certifies the identity and signatures of the parties who sign the deed of sale. It does not in any way protect the interests of others, whether the buyer or the seller.

Since it is a state entity, its fees are regulated by law: there is therefore no competition within the profession, which means that no notary is more interesting than another in price level. In addition, the first consultation with this master is free in all cases.

Expenses

The first expenses related to the notary will obviously be his fees which, in general, will be between 300 € and 700 €.

But he will also register your deed in the Property Register, a document that will guarantee the legal title of your property. This fee will fluctuate between 300 € and 600 €. This registration will generate the tax on legal documentation (abbreviated IAJD in the language of Cervantes) which will vary between 0.5% and 1.5% of the sale price, depending on the community.

Also note that if the purchase of a land will result in the construction of a house on it, you will have to discharge two deeds of property, one for the land and one for the construction.

For legal certainty: a lawyer

Although this is not mandatory, to arm a Avoca t is sound advice for buying a property in Spain. Indeed, it will accompany you throughout the purchase process and will verify the smooth running of all the steps taken. Some notaries trying to avoid their obligations by adding a disclaimer to the contract that they do not bother to explain to the buyer, it may be justified to call a lawyer to avoid falling into the trap. This legal defense will ask you for approximately 1% of the purchase price of the property (its fees vary depending on the services requested and its reputation).

The real estate agency

The purchase of real estate obviously requires passage through the real estate agency box . In principle, the buyer does not have to pay agency commission; but in many communities, the two parties negotiating the good share a commission generally of 5% HT of the price of the good.

In addition, some French-speaking real estate agencies established in Spain guide you through all stages of the purchase to better support you in a country of which you do not necessarily know all the subtleties and complications of real estate.

Don't forget everyday expenses!

Because if they do not fit directly into the budget for buying a good, they are linked to it and, therefore, care must be taken. This concerns taxes, community fees, gas and electricity subscriptions, etc.

These costs balance between 2% and 4% of the cost of ownership in one year.