buy property in spain - spanish property for sale

Local Rates

• Calculated from the rateable (catastral) value of the land which is assigned by the Spanish Tax Office.
• Takes into account the value of the land plus buildings according to the type, usage and location.
• Taking into account local rates, the Town Hall for each municipality will decide a percentage to be charged. Roughly speaking it will be usually be less than 1% of the rateable value of your property (which will nearly always be far less than it’s true market value).

Rubbish Collection and Water Rates

• The rubbish collection rate will be calculated by the Town Hall and is fixed against the type/price of property you own.
• Water consumption is calculated by the water meter.
• Payments can be made by your bank as a direct debit or at the Town Hall.
• Other Taxes

All foreigners who do not hold a Spanish residency are subject to a wealth tax (Impuesto de Patrimonio) the amount is calculated against the value of one’s assets and real estate held in Spain. It is usually under 0.5% and can be as low as 0.2%.
Non-residents must also appoint a resident to be their fiscal representative to whom all official notifications concerning your property will be sent.

on-residents must also file income tax forms and pay tax for any income received in Spain at the rate of 25%, this includes any rental of property, even if paid abroad. All non-residents will be assessed on income tax whether they have any real income or not (theory of derived benefit). It is calculated at 25% of 2% (or 0.5%) of the rateable value of the property (valor catastral).
Upon the sale of property a non-resident is subject to a tax retention of 5% of the sales price, payable against capital gains tax (which stands at 35%).

If the seller is a Spanish resident there is a flat rate of 18% capital gains tax (unless the property is your principal residence), this applies if the property has been owned for a year or more and is adjusted to compensate for inflation.
Residents are subject to filing income tax forms and declaring their income regardless of source. One is considered a fiscal resident for tax purposes if residing in Spain over 183 days per calendar year, residents permit or not.