In a divorce with property in Spain, there are basically three scenarios possible: retirement (buyout), sales to third parties, or a judicial public sale. For tax optimisation purposes, out-of-distribution (Extinción de Condominio) is usually the most advantageous option, as it avoids the heavy transfer tax and requires only a lower distribution duty.
Read more about the impact of your prenuptial agreement when buying a property in Spain.
Whether you are married in community of property or divorce: unless otherwise stated in the purchase deed, you are usually both owners for 50%. Settlement requires specific agreements under Spanish law. Below, we analyse the three options and the tax impact.
1. Undivided retirement: One partner buys out the other
If one partner wishes to keep the property and has sufficient financial resources, this is the most attractive option from a tax point of view. In Spain, this is known as the Extinción de Condominio.
Fiscal impact: Distribution duty vs. Registration duty
The major advantage of this construction is that the acquiring partner can no transfer tax (ITP, ranging from 6% to 11%) pays on the portion taken over. Instead, one pays the Actos Jurídicos Documentados (AJD), or the distribution right/stamp duty.
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Rate AJD: Varies by region (Comunidad Autónoma) between 0.5% and 2%.
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Basis: This percentage is calculated on the total tax value of the property, not just over the acquired share.
Expert Insight: “Many couples err by thinking that a partition is tax-equivalent to a sale. The savings through a correctly executed ‘Extinción de Condominio’ can amount to tens of thousands of euros compared to a regular sale in regions like the Costa Blanca.”
Calculation example: The difference in tax burden
Let's take the situation of partners A and B with a property in Dénia (Valencia region).
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Situation: Divorce, A takes over the property.
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Current market value: € 350.000.
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Share partner B: € 175.000.
| Type of transaction | Load type | Calculation | Total Cost for A |
| Regular Sales | Transfer tax (ITP - 10%) | 10% at €175,000 | € 17.500 |
| Distribution (Buyout) | Stamp duty (AJD - 1.5%) | 1.5% at €350,000 | € 5.250 |
Conclusion: Partner A saves € 12.250 by opting out of disunity.
Taxes for the outgoing partner (B)
The partner being bought out has to take into account two taxes:
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Capital gains tax (Ganancia Patrimonial): 19% to 26% on net profit (sales value minus purchase value and expenses).
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Municipal capital gains tax (Plusvalía Municipal): A tax on land appreciation.
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Note: In specific cases of divorce, a exemption apply to the Plusvalía Municipal, provided the divorce decree is correctly registered in Spain.
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Read more about apportionment law in Spain.
2. Sale to a third party
Is a buyout not financially feasible? Then sale to third parties is the logical next step. This involves selling the entire property on the open market.
Under this option, the purchase costs (notary, registration, transfer tax) shift to the buyer. The selling partners are jointly responsible for:
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Brokerage fees: Usually between 3% and 5% of the sale price.
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Value-added tax: 19% (non-residents) on realised gains.
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Plusvalía Municipal: Payable to the municipality where the property is located.
Read more about selling in Spain.
3. No agreement: judicial sale
If partners fail to agree on value or distribution, an independent third party may be appointed or, in extreme cases, court proceedings may be initiated (actio communi dividundo).
This is the worst-case scenario. The Spanish court will eventually order that the property must be sold publicly (public auction).
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Disadvantage: The yield at a public sale is statistically 20% to 40% lower than the market value.
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Costs: High litigation costs and lawyers' fees significantly reduce the net proceeds.
Frequently asked questions (FAQ)
Which is more tax advantageous when divorcing in Spain: buying out or selling?
Buying out (selling out) is more tax advantageous for the acquiring party. You will then typically pay 0.5% - 2% AJD (Stamp Duty) instead of the regular 8% - 11% transfer tax applicable in a regular sale agreement.
Do I have to pay capital gains tax in Spain on divorce? Yes, the departing partner pays capital gains tax on the difference between the purchase value and the value at allotment. For non-residents, this amounts to 19%. Exemptions are available for the municipal Plusvalía tax if the transfer is part of divorce proceedings.
Is a Belgian or Dutch divorce decree directly valid in Spain? No, a foreign judgment is not automatically recognised for the property register. The judgment often needs to be translated (sworn) and provided with an Apostille of The Hague. In complex cases, an Exequatur procedure may be required, but for real estate registration, the proper notarial endorsement in Spain is often sufficient.
How is the value of the property determined at buyout?
Partners can mutually agree on a value. If there is no agreement, it is advisable to have an official valuation (tasación) carried out by a recognised independent valuer to avoid discussions and subsequent tax claims about undervaluation.
About the author: Glenn Janssens is a lawyer specialising in Spanish real estate transactions and tax regulations. Since 2017, he has been helping Belgian and Dutch individuals and entrepreneurs to safely purchase and structure real estate in Spain. He guides files from A to Z: from due diligence, ownership and tax control to estate planning and optimisation for residents and non-residents. Thanks to his years of experience, hundreds of handled files and focus on transparent communication, Glenn makes complex Spanish legislation understandable and practically applicable for every property buyer.
