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17/05/2012 18:12:00

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SELLING A HOME IN SPAIN


SELLING A HOME IN SPAIN

-If the seller is a Spanish or a foreign tax resident in Spain over 65 years old and has lived in the house for over 3 years, they are not subject to tax of 19% on the increase in equity.

- If the seller is Spanish or a foreign tax resident in Spain and reinvests in a purchase of a new residence they are not subject to tax of 19% on the increase in equity.

-If the seller is Spanish, no withholding is exercised during the signing of the title deeds. Taxes of 19% are paid on the increase in equity, except in cases of first residence. Taxes will be paid as income tax for the year in which the profit was made.

-If you are a foreigner who sells to a tax-resident in Spain: The tax treatment is the same as if you were selling to a Spanish national..

-If the seller is a nonresident alien for tax purposes in Spain: retention of 3% of the purchase price is withheld at the time of the signing of the title deeds. Within 30 working days after the deed of sale, you must declare and pay tax profit of 19% minus the retentions withheld.

-If the seller is a Spanish company, it is taxed on 20, 25 or 30 percent, as appropriate, on the earnings obtained by sale of the property.

-The property must be current on IBI tax payments (last 5 years), garbage collection fees and fees of the Community of Owners.

Once the house has been purchased:

-The local town hall will issue the following receipts and it is recommended to have them paid by automatic bank draft:
1 .- IBI
2 .- Trash Service

OBLIGATIONS FOR NON RESIDENT HOMEOWNER

-Payment of income taxes on a presumed annual income on a property of 24% and 2% calculated on the assessed value if it exists. In the absence of an assessed value assigned to property, the tax is calculated based on 1.1% of half the purchase price and the result will be applied a 24% rate.

-These taxes are also paid by foreigners resident in Spain, second homes and other properties located in Spanish territory.

Algar Villas offers this information only as a guide.


SELLING A HOME IN SPAIN SELLING A HOME IN SPAIN SELLING A HOME IN SPAIN

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