Buying a property in Spain involves several taxes that you should be aware of to plan your investment correctly. These taxes vary depending on the type of property (new or second-hand) and the autonomous community where it is located. This guide provides a detailed explanation of the taxes you will need to pay when purchasing a property in Spain.
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Taxes When Buying a New Property
Value Added Tax (VAT)
If you are purchasing a newly built property in Spain, you must pay VAT:
- General rate: 10% of the purchase price.
- Officially Protected Housing (VPO): 4% for special regime or public promotion properties.
- Canary Islands: Instead of VAT, the IGIC (General Indirect Canary Tax) applies at 7%.
Find more information about VAT on property purchases.
Stamp Duty (IAJD)
This tax varies by autonomous community and ranges between 0.5% and 1.5% of the purchase price. Since 2018, banks assume this tax when financing the purchase with a mortgage.
Check the IAJD and its implications.
Taxes When Buying a Second-Hand Property
Property Transfer Tax (ITP)
For second-hand properties, the main tax to pay is the ITP, which varies depending on the autonomous community:
- Generally between 6% and 10% of the registered property value.
- Discounts are available for large families, young buyers, and disabled individuals.
Check the ITP rates by community on Idealista.
Other Taxes and Additional Costs
- Commercial properties: If you buy a commercial space, VAT is 21%.
- Notary and registration fees: Additional costs that should be considered in the total purchase budget.
- Income Tax Declaration (IRPF): The purchase of a property must be declared in the income tax return, including the cadastral reference and possible deductions.
More details on declaring a property purchase in the IRPF.
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Fiscal Procedures After the Purchase
- Settle the applicable taxes with the regional tax authority.
- Register the purchase at the Property Registry.
- Declare the purchase in the IRPF and update your tax address.
Check the property registration process.
It is highly recommended to consult a tax advisor or legal expert to avoid mistakes and ensure compliance with all tax obligations.
Frequently Asked Questions
How much tax do I have to pay when buying a property in Spain?
Taxes typically represent between 10% and 12% of the property price, depending on whether it is new or second-hand and the autonomous community.
Who pays the IAJD tax on a mortgage?
Since 2018, the Stamp Duty on mortgages is paid by banks, not buyers.
Are there tax benefits for buyers?
Yes, some autonomous communities offer ITP reductions for young buyers, large families, and disabled individuals.
If you are planning to buy a property in Spain, budget carefully to avoid surprises and ensure you meet all your tax obligations.
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