The purchase of a property in Spain differs considerably in some areas from the purchase procedure in Germany. In general, we recommend contacting a local accountant or lawyer to double-check and clarify in detail the local tax circumstances.
After making a decision to buy and securing financing, the Escritura, the notarial deed of purchase, as well as the current Nota Simple, the Land Registry excerpt, are usually viewed by us and a preliminary purchase agreement is drawn up in which a subsequent notary appointment is agreed. A deposit of 10% of the purchase price is to be paid immediately after signing the purchase contract and corresponds to a binding reservation of the property. The preliminary purchase contract is accompanied by a Nota Simple.
If the buyer does not already have one, the buyer must apply for a N.I.E. number, which is the Spanish tax code for foreigners. This can be applied for in Spain or in your home country at the Spanish consulate.
In the following weeks, we will compile the necessary documents for the notarial deed and arrange a notary appointment. At the notary appointment the contract is checked and signed; at this time, the payment of the balance is due, usually in the form of a check. If a non-resident sells a property in Spain, 3% of the purchase price is to be withheld and retained as the Impuesto sobre la Renta no Residentes, which is similar to capital gains tax, and is to be paid to the tax office. Afterwards, the notary informs the Land Registry of the Asiento de Presentación which is the transfer of ownership. The registration of the notarial deed follows as well as the request for payment of the IVA or ITP, the land transfer tax at the tax office. Similar to the purchase procedure in Germany, the transfer of ownership is completed with the final transfer in the Land Registry, this usually takes 2 to 4 months depending on the workload of the Land Registry.
The following incidental costs are to be taken into account when buying property in Spain:
As a rule, a bank loan is taken out on the purchase of a property, whereby the incidental costs of the financing differ greatly, depending on the bank, equity and amount of the loan. Attention must be paid to any transfer costs, processing fees, valuation costs, provisioning fees, partial payment surcharges and special repayment fees.
If a lawyer or accountant is consulted, they must be reimbursed correspondingly. Hourly rates and expenses are also different depending on the region, as a rough guideline, costs of € 1,000 - € 2,500 or 1% of the purchase price should be expected.
Land Registry and notary fees
There are legal fees incurred for the activities of the Land Registry. The Land Registry and notary costs usually depend on the region and purchase price amount and are between 1% to 1.5% of the purchase price.
IVA/ITP/Property transfer tax
The property transfer tax is calculated according to whether the property purchase is subject to IVA, Spanish VAT or the ITP, the property transfer tax. When buying new property, the IVA is charged at 10%, in Tenerife at 4.5%. When buying land, the IVA is 21%. If IVA has to be paid, the AJD tax, the so-called stamp duty of 0.5% to 1.5% will be taken into account. The ITP is incurred only for a second hand property purchase, the amount depending on the region, which is similar to Germany in the various Federal States; 6.5% is charged in Tenerife, between 8% and 11% in Marbella, Mallorca and Ibiza, and 10% in Barcelona and the Costa Blanca.
The broker commission is only charged on the successful completion of an apartment or house purchase. The amount of the broker commission depends on the region, but is usually between 3% and 5% of the selling price. As a rule, the seller assumes the broker commission, but special arrangements are also possible.