What are the Cost and Fees Involved in the Purchase?
Notary. Fixed fees can vary in different notaries and depends on the price of the property, the amount of documents etc. Generally a property sold for 200,000 Euros will pay between 600 to 900 Euros.
Property Registry. The fee depends on the price of the property. A property sold for 200 000 Euros will typically pay around 500 Euros for the registration.
Lawyer. You can chose to have a lawyer representing you in the sale, this is optional but a very effective way to get things done without having to worry about it. The lawyer will arrange the inscription of the new deed in the land registry, open a bank account for you as well as arrange payments of all the relevant transfer taxes associated with the purchase. They can also set up contracts for water, electricity, internet providers, town hall taxes etc. It is very practical to have these payments set up on a direct debit from a Spanish bank account. A property lawyer normally charge 1% plus VAT of the price.
Taxes payable by the buyer
It is important to know that if you buy a new property from a developer you pay, in total 3,8% more in taxes than if you buy a used (resale) property.
The tax for resale property is ITP of
8% for amounts under 400, 000 Euros
9% for amounts between 400, 001 Euros – 700, 000 Euros and
10% for amounts over 700, 001 Euros.
For new properties (new developments) there is no ITP but VAT (IVA) of 10% payable regardless of the price and there is also 1,5% Stamp duty (AJD).
Other costs are the Notary fees and Land Registry fees that are a fixed scale, and the lawyers fee which normally is 1% plus VAT. If you are taking out a mortgage count on approximately 1-1,5% opening fee of the mortgage amount and 1,8% of taxes and notary fees for the mortgage deed, as well.
These cost and taxes are not reflected on the advertised price for the property and has to be added on top. For a resale property you have to calculate around 9-11% on top of the asking price and for a new property is will cost between 12-14%.
Taxes payable by the vendor
Plusvalia. This tax is a municipal tax based on the increase of the taxable value of the property during the time between the purchase and sale of the property. The tax has to be calculated individually. The longer the property has been owned the more you pay. StartGroup can calculate the plusvalia for you.
Capital Gains tax. For the year 2016 the tax scale is 19% for the fist 6000 Euros gain, 21% for the amount between 6000 and 50 000 gain, and 23% for amounts over 50 000 Euros.
Fiscal retention for non-residents. For non-resident vendors the buyer must withhold 3% of the purchase price and pay that directly to the tax office on the vendors behalf. This is a measure to prevent tax evasion by the vendor who resides in another country. The vendor has 90 days after the payment has been done to submit a tax return for capital gains tax which will show how much has to be paid. If there is no gain in the sale the 3% will be paid back to the vendor by the tax authorities.
For more information please contact us at +34 902 570 849, email:[email protected] or visit our offices in Calahonda, Mijas Costa.
We are happy to answer all your questions of buying a property on the Costa del Sol!
All information is correct at the publishing of this article in February 2016 and is meant as a Buyers Guide for property on the Costa del Sol. The text has no contractual value and can be subject to change without prior notice.