What is the property sales tax in Spain ? The seller will confront two different taxes:
1. Capital gains tax (ganancias patrimoniales) –
As a result of the money pocketed after selling your Spanish property, provided you have not lost money from the original purchase price you paid back then, you will have to pay 19% from the profits. How do you calculate those profits?
Let´s follow an example:
You purchased a Spanish property for 84.000 € in 2014 (+10.000 in taxes +2.000 in notary/register expenses + 4.000 invested in a new roof). Total cost: 100.000.
In 2017 you sell it to another person for 130.000 €.
You will have to pay to the Kingdom of Spain a 19% “wealth increase tax” from the 30.000 profit (i.e.: 5.700 €).
2. Land value increase tax (incremento del valor terrenos urbanos) –
The second property sales tax in Spain will have to be paid to the town hall, and it depends on a couple of variables:
A) The land value where your property is constructed (valor del suelo[you can find it in your annual IBI tax property bill issued by your town hall]).
B) the number of years you have owned the property. The land value can be a fourth or a third of the real market value of the built property.
So, just as a very rough example: Say your constructed apartment or house is valued in the current market at 130.000 €. Your corresponding land value will be usually not more than 40.000 euros.
If you have owned the property for 5 years and want to sell it now…most likely this tax will be between 900 and 1.900 € depending on where the property is located in Spain (estimate for 2017 official land value prices). If you have owned it for more than 5 years or/and the value is higher expect a higher tax…
Note: Tax breaks may apply if the property is inherited by, bequeathed or gifted to family members, if you the seller are above 65 years of age, if it is your main abode… each city/village has its own tax breaks. We would have to consult each case within the regulations.
This page is a rough explanation. Consult with us or your advisor for a whole picture of any financial operation you are embarking upon.
Text updated in 2021