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| Property-related tax |
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VAT: value added tax |
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This is payable on the purchase of a new build home, that is, the first handing over of the home by the developer-builder to the buyer. The purchaser of a new build home pays VAT in stages on each payment he or she makes to the developer-builder. The rates are applied to the sale price and are as follows: |
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7% for homes, including garage spaces, with a maximum of two units, and annexes (basements, attics, store rooms etc.) situated at them, providing they are transferred together, that is, in the same act, on the same date and through the same notary, no matter whether they appear in the same or a different private document or public notarised deed.
- 16% for commercial premises and plots.
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4% for homes with protección oficial (subsidised from public funds).
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Property Transfer Tax |
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This is levied on subsequent handing over of homes, that is, the purchase of resale homes. Transactions subject to VAT are not subject to PTT, that is, the two taxes are mutually exclusive. The person liable to pay this tax is the buyer of a resale home. As a general rule the rate is 7% of the value of the home. |
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Stamp Duty Tax |
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This tax applies to deeds formalised in public documents, inscribable and for a specific monetary amount, as is the case with home sales. It's a percentage, which varies between 0.1% and 1% from one Autonomous Community to another. It's calculated on the sum specified in the public notarised deed for the sale of the home. |
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Hence it's a tax which accrues at the time the public notarised deed is formalised. It's payable both where VAT exists and where Property Transfer Tax exists. |
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Local Property Tax (Council Tax) |
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This is a direct tax of a local nature which is levied on the value of property. It's payable by owners of property and is billed once a year. It's the Council of each municipality who calculates and bills it. Local Property Tax is calculated on the assessed value of the property, which reflects the value of the plot it occupies and of the structure. |
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It's a tax which is payable by both residents and non-residents, from the time when they become the owners of a property in Spain. |
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According to the law, the owner of the property on 1st January of a particular year is the one who must pay the Local Property Tax for that year. |
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Land Appreciation Tax |
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This is a municipal tax payable every time a property changes hands. It is levied on the increase in value of the plot which has taken place between the date it was acquired and the date when it is passed on. |
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| Who has to pay the Land Appreciation Tax? |
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- In a sale: the seller
- In inheritance: the heirs
- In a donation: the recipient of the donation
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Any terms of agreement which are formalized in the notarised deed and which run counter to the above will take effect only between the parties, and not in respect of the Administrative Organ, which will apply to the persons whose names appear in the notarised deed. |
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