Tax on the profit on the sale of a property in Spain
Tax is payable on the profit made on the sale of a property in Spain:
Profit Tax
<6,000 euros 19%
> 6,000 euros 21%
> 24,000 euros 23%
Non-resident Fixed rate of 19%
The difference between the sale and purchase price may be reduced by a few direct costs such as the transfer tax (on purchase) and real estate agent commissions (on sale).
If you are a resident in Spain, you should declare the sales profit on your regular annual tax return.
If you are not a resident in Spain, then at the time of sale at the notary, 3% of the sales price will be deducted to be paid to the Spanish tax authorities. This payment has the character of a deposit (so that sellers can not get out of the tax by leaving with the northern sun). As a non-resident seller you then have three months to submit the final declaration. If the final tax is higher you have to pay the difference, but if this is lower you can reclaim the difference.
We are happy to assist you with all these declarations.
Exemption
If the sold property is a house where you actually lived for more than three years (and where you were registered), the profit on sale is exempt if you reinvest this profit within three years in another house where you actually live again (it should therefore not be a home for the rental).
The profit on sale is also exempt for tax residents older than 65 years who used the property as a main residence for at least the last three years.
Tax on sales on the appreciation of the land
Particularly in Spain is the municipal tax on the value increase of the land (according to municipal indexes) during the holding period. This must be paid by the seller (unless otherwise agreed). With a long holding period, this tax may increase slightly, with a short holding period it is usually small. Nevertheless, it is advisable to gather information for this purpose in order to prevent setbacks.
Can we be of service to you?
Do you have a question or do you want clear information on how we can take care of your tax returns?
We are happy to be of service to you.