Taxes, fees and paperwork when you buy a property in Spain

01/21/20 05:51 PM By Valeriu

Taxes and fees for buyers...

When you're buying a property, you have to pay taxes and fees and fill all the legal paperwork.


What are those, to whom are they paid , how much and how much must be paid?


This are the information that we like to give you.

 TRANSFER TAX ON A PRE-USED PROPERTY 


First, and the most important tax you have to pay when buy a property in Spain is Transfer tax on resale properties (ITP - Impuesto sobre Transmisiones Patrimoniales) and it varies on 3 thresholds for the resaled properties:

 

·  8% for purchases up to 400,000€

·  9% for purchases between 400,001€ and 700,000€

· 10% for purchases over 700,000€


 TAX ON NEW (OFF-PLAN) PROPERTIES 


When buying a new property you pay IVA (VAT), instead of Transfer Tax which is set at 10% and stamp duty which is currently set at 1.5%.


This tax can be smaller in some particular cases. For more details about the reduced tax when buying a property in Marbella, Spain, visit the Junta de Andalucia portal.


Beside the above tax, which is by far, the greatest one, there are other small costs and paperwork needed.


 CONSULTING FEES 

 

Most real estate agents charge of the purchase price for their services.


Although our services are unique on Marbella and even Andalucia, Spain, we have  0% COMMISSION  for buyers.


 LEGAL FEES 

 

Most lawyers charge 1% (plus VAT) of the purchase price.

 

 ADDITIONAL FEES 

 

You will also need to pay 1% for notary and land registry fees and allow another 1% for various documents required such as power of attorney, NIE application and setting up utility contracts.

 

 SO… IN SUMMARY 


If you allow an additional 11% for a resale (secondhand) property or 14.5% if you’re buying a new build or off plan property you’ll have it all covered.

 

Next you will need to sign a reservation agreement in order to reserve the property and take it off the market and pay a deposit of between 3000€ to 6000€ depending on the property’s price.

 

This is an agreement that freezes the purchase price and takes the property off the market. The deposit will be held by your lawyer or your agent in a segregated client bank account.

 

After your lawyer obtains your NIE and checks the paperwork, if everything clears, the purchase contract (Spanish - contrato de arras) will be signed, requiring a 10% deposit to be paid, including the original reservation deposit.

 

If you want to buy the property using a loan, we can arrange a meeting with our bank (Caixa) consultants or any other local banks to discuss a mortgage plan for you.


Better than that, if you want, we can do it for you before your arrival, so you’ll know what amount are you eligible to loan from Spain (max. 70% of the property’s value over 20-30 years on rates ranging 1.75 - 5 %).


And if you have any questions or any doubts, don't hesitate and contact us.



Any questions or doubts you might have, don't hesitate to send us a message,

book a FREE call with one of our experts
... or send us an email.