Digital Version Guide 005 - Flipbook - Page 98
B U Y I N G
&
T A X
G U I D E
Understanding
Taxes on Property
Purchases and
Ownership in
Andalucia
Understanding the taxes and fees associated with buying property in
Spain is essential for a smooth and informed purchase. From transfer taxes
and VAT to annual property levies like IBI and Wealth Tax, the obligations
vary based on the type of property, your residency status, and the region.
This section provides a clear breakdown of what to expect, ensuring you’re
prepared for every stage of the process.
The taxes you pay will depend on whether you’re purchasing a new property
or a resale.
PURCHASE RESALE PROPERTIES
Property Transfer Tax (ITP)
This tax applies to the transfer of second-hand properties. Rates range from
6% to 10%, depending on the region. In Andalusia, the general rate is 7%,
but there are reduced rates for specific circumstances:
6%: If the property value is under €150,000 and intended as your primary
residence.
3.5%: For buyers meeting certain criteria, such as:
Being under 35 years old, a victim of domestic violence or terrorism, or buying
in a depopulated area. Having a disability of 33% or more or being part of a
large family, with the property value up to €250,000.
2%: For properties purchased for resale by businesses or specific public sector
entities. This lower tax rate is designed to encourage investment and stimulate
the real estate market.
Capital Gains Tax (Plusvalía Municipal)
This tax is based on the increase in the land’s cadastral value over time, not
the property itself. Although the seller typically pays it, it’s wise to clarify
during negotiations.
PURCHASE NEW DEVELOPMENT PROPERTIES
VAT (IVA) and Stamp Duty (AJD)
When buying directly from a developer, you’ll pay 10% VAT on the purchase
price. Additionally, Stamp Duty applies, which ranges from 1% to 1.5%,
depending on the region (1.2% in Andalusia).
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