Fees and taxes

There are taxes and two fees payable on all transfers of Spanish properties. The Notary is entitled to a fee for preparing the Escritura, and there is a further fee for registering the property in the new owner’s name. There is a document tax of 0.75% plus a local tax (I.G.I.C.) which is at present 5% of the official value if you are purchasing a new property from a developer, or a 6.5% transfer tax if you are purchasing a resale property from a private owner.

There is also a tax on the increased value of the land known as Plus Valia, which is levied at various rates on the annual increase in value since the previous sale. Strictly under Spanish law, the seller is liable to pay the Plus Valia tax but in practice the purchaser is asked to pay all fees and taxes in the transfer of a property. The fees and transfer tax are demanded soon after the Escritura is signed, but the Plus Valia tax is often not payable until some time later when the seller may not be found. Plus Valia is charged against the property, which means that if the vendor fails to pay, the purchaser will eventually be liable for this tax anyway.

There are many factors that enter into the calculations of these fees and taxes but as a general rule of thumb, if you allow 8% to 10% of the purchase price you will not be far out.

Another fee for consideration is that of a solicitor or lawyer and this will generally depend on how much time and work is involved in any particular purchase. These fees can vary greatly between one lawyer to another and not always will the final bill be what was originally estimated – however, the bonded lawyer that we can refer you to will not deviate from the fees quoted.

After the purchase of your property you will have community fees to pay to an owners association which is explained further under the heading of The Community of Owners.