In this article, we discuss the various Spanish taxes on the purchase of a second residence. There are also other additional taxes and fees. Below is a summary.
Registration tax (Impuesto de Transmisión Patrimonial) on resale
When you purchase a property from a private individual, you pay the registration tax. The registration tax depends on the region and the rate is between 6% and 10% of the purchase amount. In the Comunidad Valenciana the rate is 10% on the purchase value of the property. In Murcia, the rate is 8%.
Sometimes people make the split between the property and the furniture to reduce the registration tax. In Spain, however, there is a transfer tax on the furniture. Again, the rate depends on the region. In Valencia, the rate is 6%.
VAT and stamp duty on new buildings
If you buy new construction, you will pay VAT instead of registration fees. Again, the rate is determined by the different regions. In the CValencian ominidad the rate is 10%. In 2023, there will be a rate of 11% for homes worth more than EUR 1,000,000.
In addition, stamp duty applies in three situations. For instance, the most common situation will be new construction. Also, if you take out a mortgage loan, you will pay stamp duty. Finally, it is often forgotten that stamp duty will also be payable if you remodel/expand your property.
In Comunidad Valenciana 1.5%. So on new construction, you will pay 10% VAT and 1.5% stamp duty anyway.
In principle, the VAT rate also applies to extras and additional work. However, there are conditions attached to this. Indeed, on some additional work you pay the standard rate of 21% VAT. More information on VAT on new construction in Spain.
Notary and registration fees
Besides these taxes, you will also pay notary and land registry fees. These fees depend on the transaction value of the property. Broadly speaking, these costs situate around 0.15% - 1.5% of the purchase value. The higher the purchase value, the lower the costs will be in percentage terms. As an example, the notary and registration fees for the purchase of a property worth €100,000 will be around €1,100.
Lawyers' fees and the cost of checks on the property amount to between 1% and 2% of the transaction value.
Finally, you may have to pay your broker for his services. In that case, these costs will obviously also increase the total cost.
If you are considering taking out a mortgage loan to finance your home, it is best to take extra costs into account. Find the cost of a mortgage in Spain here.
Excluding any agency fees, you will pay around 12,50% - 15% taxes and fees on top of the purchase value of the property. If you are interested in buying a property in Spain, you can find out more about the buying a Spanish property.
Update: December 2022.