When buying a Spanish property there are both costs for the buyer and seller. However, there are uncertainties as to which costs belong to the buyer and which to the seller.
There is no fixed fee when it comes to selling a property in Spain as there are many factors that influence the amount of taxes to pay.
Generally speaking in Spain on average the buyer will end up paying around 12%-14% on fees and taxes and the seller around 23% on the profit made from selling the property.
Costs for buying a property in Spain
- Property Transfer Tax
(between 4%-11%) - Notary fees
(between 600-1000 euros) - Property registry costs
(400-650 euros) - Gestoría costs
(between 250-500 euros) - Property valuation costs
(only if a bank mortgage is needed normally around 800 euros)
For newly built properties
- IVA or VAT
- (10%)
- IAJD
- (between 0.5%-1.5%)
Costs for selling a property in Spain
- Agency commission
(between 3%-6%) - Capital gains tax
(variable 19%,21%,23% for 2020) - Income Tax Provision (Retención
(3% non-residents only) - Energy certificate
(between 100-500 euros) - Plusvalía
Notary fees (Buyer)
These are the costs for drawing up the deeds in Spain called the “Escritura”. In general, Spanish law states that these costs should be distributed by the signing parties, meaning that the sellers should take care of the original costs of the deeds “escritura” and the buyer for the copies. However, Nowadays it is normal that the buyer pays for all these costs.
Notary fees are based on the selling price stated in the deeds of the property. As an example, you pay around 675 euros for a property of 100.000 euros. But for a property of 1 million, you might have to pay 1000 euros. To search for a Spanish notary in your area, visit the Spanish Notarial Guide.
Property registry costs (Buyer)
It is normally a standard fee also based on the selling price in the deeds. These costs may vary depending on the municipality you live in and in most cases, it is between 400 and 650 euros.
Gestoría (Buyer)
This is an optional cost. A gestoría is like a bookkeeper that handles tax payments and paperwork to formalize the deeds of the property and mortgages.
Solicitors can also handle all paperwork and normally charge around 1% of the selling price.
Property transfer tax (Buyer)
When buying a second-hand property, the buyer has to pay the property transfer tax. For newly built properties, the buyer pays instead VAT or IVA of 10%.
The property transfer tax is a tax that varies from region to region
In Valencia, Catalonia, and Galicia region, the property transfer tax is 10%.
In the Balearics, it is 8% for properties under 400.000 euros, 9% for properties between 400.000 and 600.000 euros and 10% for properties of more than 600.000 euros.
In Andalucía you pay between 8% and 10%, and in the Canary Islands 6.5%
Almost every year the Spanish government changes the cadastral value for each municipality, which has a direct effect of the Property transfer tax and Plusvalía tax.
Property valuation costs (Buyer)
In case a buyer needs a mortgage, the bank has to make a valuation of the property. In this case, the buyer will pay around 800 euros for this appraisal.
For newly built properties (Buyer)
When buying a newly built property directly from the developer you pay IVA or VAT of 10% instead of paying the normal property transfer tax. On top of that, you also pay a Tax on documented legal acts or IAJD in Spanish
Agency Commission (Seller)
When you sell a property through an estate agent you will have to pay a commission fee. Estate agents usually charge around 5% commission in Spain. The seller can deduct the Agency commission fee from his capitals gains tax.
As a seller, you might want to ask the services the agency provides. Good estate agents should also have the legal know-how to make option contracts, apply for NIE numbers, and after-sales services like changing the utility bills and community charges to the new owner for example.
Sellers can advertise their property through several estate agents. Nevertheless, some estate agents will want to offer the seller to sell it exclusively through them by agreeing to take a smaller commission fee.
Did you know that it takes an average of more than 8 months to sell a property in Spain?
Sellers need to take that into account when advertising their property exclusively through an estate agent.
Capital gains tax (Seller)
19% for the first 6.000 euros
21% from 6.000 and 50.000 euros
23% from 50.000 onwards
As an example if the seller bought a house in 2003 for 200.000 euros and in 2018 he sells it for 350.000 euros, he will have to pay capital gains over 150.000 euros in this way:
(350.000 – 200.000 = 150.000). 19% for the first 6.000 (6.000 x 0.19) + (50.000 x 0.21) + (94.000 x 0.23)= 1.140 + 10.500 + 21.620= 33.260 euros.
There are exceptions when the seller does not have to pay capital gains tax and that is when the sellers of the property are older than 65 and have lived there officially for at least the last 3 years.
All official invoices relating to the purchase of the property, such as refurbishing, notary expenses, lawyer expenses, and estate agency fees can be deducted from the capital gains tax.
Income Tax Provision for non-residents – Retención (Seller)
If the seller is not a Spanish resident he has to pay a 3% income tax provision or retención in Spanish which goes directly to the tax office to cover any taxes resulting from the sale. However, the seller can claim for a refund if he believes that his tax liability is less than 3%.
Energy certificate (Seller)
From June 1, 2013, by Spanish law all property owners who want to sell or rent out their property need an energy certificate. These certificates must be issued by a qualified certifier, such as architects, surveyors or technical house engineers. The costs for such a certificate may vary on the size of the property and can be between 100 and 500 euros. The invoice for this certificate can also be deducted from the capital gains tax.
Plusvalía (Seller)
The plusvalía is a tax over the increase of the value of the ground the property is on. This is paid to the local town hall. The plusvalía is calculated on the basis of 3 factors: The period of ownership, the location of the property and the cadastral ground value.
The plusvalía tax can easily be requested at the town hall where the property is located.
By law, the plusvalía tax should be paid by the seller and it can be a substantial sum of money. Nevertheless, the plusvalía can be paid by the buyer if he has agreed to it.
View example of a Plusvalía (.pdf)
Here is a basic example giving some rough estimates of the costs:
Mr. A (the seller) sold his apartment in Mallorca to Mr. B (the buyer). When Mr. A bought the apartment in 2003 he paid 200.000 euros. Now Mr. A has managed to sell the apartment in 2020 to Mr. B for 350.000 euros.
If you want to sell your home in Spain, you might also be interested to read about these tips for selling your property in Spain FAST.
Costs for the seller (Mr. A)
| Sold it in 2020 | 350.000 |
| Bought it 2003 | – 200.000 |
| Profit before taxes | 150.000 |
| Capital gains | – 33.260 |
| Agency fee 5% | – 17.500 |
| Income Tax Provision 3% | – 10.500 |
| Plusvalía tax | – 4.000 |
| Energy certificate | – 300 |
| Net profit | 84.440 |
Costs for the buyer (Mr. B)
| Purchase price | 350.000 |
| Property transfer tax 8% | 28.000 |
| Notary fee | 800 |
| Registry costs | 600 |
| Gestoría | 400 |
| Total Costs | 379.800 |