Below is a brief explanation of the most common taxes you may encounter in Spain.
1. Property Tax (Impuesto sobre bienes inmuebles):
The owner of the property pays between 0.3% and 0.6% of the cadastral value, which differs per municipality.
2. Transfer tax (Impuesto de Transmisiones Patrimoniales):
Transfer tax is 10% on the amount stated in the title deed. This applies to existing homes or plots of land owned by a private individual.
3. IVA (VAT):
The rate is 10% in the following cases.
- On the purchase of a newly built house from a property developer.
- When purchasing a building plot linked to a building contract for a home.
The rate is 21% in the following cases.
- When purchasing a commercial property.
- On the purchase of a building plot from a property developer or company.
In addition, you may also have to deal with property tax, tax on the increase in value of land and house, capital gains tax, etc.
If you have any questions about other tax matters, we kindly ask you to contact us. We are happy to help you!
It is interesting to invest in Spain now, because property prices are rising every year. There are a number of possibilities to make the investment result in a good investment.
1. As a sale and to occupy the property yourself. After a number of years it will be possible to make a profit on the sale.
2. As a sale and to let the house. This will result in an annual rental income, with a minimum net return of 5%. It will also be possible to make a profit on the sale.
3. Renovate a house and then sell or let it with an option to buy.
Through good knowledge of the market and close contacts with banks, brokers, contractors and project developers, we can give you good advice, for a good investment.
If you have any questions about investing in real estate, we kindly ask you to contact us. We are happy to help you!