{"id":3204,"date":"2013-11-21T08:00:45","date_gmt":"2013-11-21T08:00:45","guid":{"rendered":"http:\/\/www.asociacion-eurojuris.es\/en\/?p=3204"},"modified":"2020-04-11T07:21:11","modified_gmt":"2020-04-11T07:21:11","slug":"fees-and-taxes-associated-with-the-purchase-of-property-in-spain","status":"publish","type":"post","link":"https:\/\/www.asociacion-eurojuris.es\/en\/fees-and-taxes-associated-with-the-purchase-of-property-in-spain\/","title":{"rendered":"Fees and taxes associated with the purchase of property in Spain"},"content":{"rendered":"

Following the approval of the Law of the Entrepreneur and Internationalization (the \u201cLaw\u201d), many foreign nationals opt to acquire property in Spain with the objective of obtaining Spanish residence.<\/strong><\/p>\n

While the Law also contemplates other types of investment to obtain residence (i.e. the acquisition of public debt or shares of Spanish companies or the creation of business projects with general interest for Spain), the purchase of property is an especially attractive investment option.<\/p>\n

Any foreign national interested in buying property must know and be familiar with the Spanish tax system as well as the fees associated with the purchase.\u00a0 In this way, the investor will learn about the return on his or her investment and the total amount of the transaction.<\/p>\n

In this sense, we specify the principal fees that the purchase generates as the following:\u00a0 the Notary deed; registration of the property in the Property Registry; payment of taxes, costs of management <\/b>(in case of applying for a mortgage), and municipal capital gains.\u00a0 <\/b>Nowadays, this last tax does not apply to the purchaser but instead applies to the seller — unless the parties have previously contracted otherwise.<\/p>\n

In the case of foreign nationals who invest in property with the objective of benefiting from the Law, the investment must be equal to or greater than 500,000\u20ac and free of any liens or encumbrances.\u00a0 Therefore, this part of the investment would be free of management fees.<\/p>\n

Next, we explain in detail the rest of the costs:<\/p>\n

Notary Fees<\/b><\/em><\/span><\/p>\n

These fees result from executing the deed of purchase.\u00a0 They are fixed fees (regulated by law), meaning that all notaries in Spain charge the same rate for the same service (and, therefore, their competition is based on quality of service).\u00a0 The quantity varies by the total amount of the property, and it can increase based on various aspects (such as the number of copies to be notarized, additional writings, the status of presentation, etc.).<\/p>\n

Registry of the Property<\/b><\/em><\/span><\/p>\n

This tax shares a certain similarity with the notary fees because it, too, is subject to regulation.\u00a0 The quantity depends on the price of the property, and there exist variations (i.e. if the property is public, a forest, or a farm).<\/p>\n

Taxes<\/b><\/em><\/span><\/p>\n

This section can be more complex because we must differentiate between \u201cnew homes\u201d and \u201cresale properties.\u201d<\/p>\n

The \u201cnew home\u201d concept refers to handing over the home to the purchasers for the first time once the construction is finalized.\u00a0 The \u201cnew home\u201d concept also refers to the situation where renters who had been living in the home after its construction later acquire it by purchase.<\/p>\n

If the purchasers are not those who had been renting the property, the handing over of the property to the purchasers will fall into the \u201cresale properties\u201d category.\u00a0 Also in this category would be properties not specifically named in this section.<\/p>\n

The taxation of \u201cnew homes\u201d would be:<\/b><\/p>\n