Frequently Asked Questions

Buying a property in Spain

What are the costs involved in buying a property in Spain?

As a buyer of property in Spain there are a number of costs and taxes over and above the property price that you will have to pay. Depending upon whether you are buying a new property from a developer, or a resale property from a private individual, you will either have to pay VAT & Stamp Duty, or a transfer tax. The different cases are explained below, along with the other costs and taxes that are common to both cases.

1. Costs associated with buying a new home from a developer (or bank)
These are the costs you will face when buying a new home in Spain from a developer or bank. It doesn’t matter how long ago the property was built. To count as a new home it must never have been sold before.

1.1 VAT & Stamp Duty (IVA & Actos Jurídicos Documentados – AJD)
These taxes apply for residential properties being sold for the first time (never previously occupied), or for commercial properties and plots of land. This is a national tax, so VAT is the same wherever the property is located (with the exception of the Canaries, which have their own version of VAT).

At present VAT (known as IVA in Spain) is 10% on the purchase price of residential properties (villa, apartment, etc), and 21% for commercial properties and plots of land.

VAT on new homes in the Canaries is known as IGIC (Impuesto General Indirecto Canario), and currently stands at 4.5%

VAT on newly-built homes rose from 4% to 10% on 01/01/2012.

The Stamp duty (known as AJD) is 1% of the price of the purchase, but might go up in some regions, so be sure to check on the latest rate. Both VAT and Stamp Duty are paid by the buyer, and if any deposit is paid before completion of the sale, such deposit will be subject to VAT at the moment of payment of this deposit. In this scenario there is no transfer tax to pay.

2. Costs associated with buying a resale home in Spain
These are the costs you will face when buying a Spanish property that has been sold before. Generally speaking, that means when buying a home from a private individual.

2.1 Spanish Transfer Tax (Impuesto sobre Transmisiones Patrimoniales – ITP)
This tax applies if the property is deemed to be a second or posterior transfer (i.e. not the first time a newly built home is bought), and is paid by the buyer. If any deposit is paid before completion of the sale it is not subject to ITP pro rata. However the full amount of ITP still has to be paid upon completion. In this scenario there is no VAT to pay, and stamp duty is already included in this tax.

The Transfer Tax rate is ceded to the autonomous regions, who can choose to apply the general rate, or their own rate.

The general (national) rule of ITP is 7%, but many of the autonomous regions have applied higher local rates. The rate you pay depends upon the autonomous region where you buy (for more information see Transfer tax on resale homes – Impuesto de Transmisiones Patrimoniales (ITP))

2.2 Income tax provision when buying from non-residents
If the seller is not resident in Spain, the buyer has to withhold 3% of the purchase price and pay it to the tax authorities (application form 211). If this is not done the property will be considered by the tax authorities as the asset backing the capital gains tax liability of the seller. This condition is very unlikely to apply when purchasing from a developer.

3. Costs associated with both new build and resale property purchases in Spain
These are the additional expenses you are likely to face when buying any property in Spain, regardless of whether the property is new or not.

3.1 Estate agency Fees
Estate agency fees or commissions are paid by the seller, unless otherwise agreed. If the buyer uses a search agency then search fees are paid by the buyer.  Unless the buyer has specifically agreed to pay the agent’s fee this cost will be built into the sale price.

3.2 Legal Fees
You are strongly advised to hire a lawyer to help you during the buying process. Your lawyer drafts and reviews contracts on your behalf and can explain all the legal and administrative issues you face. Your lawyer should also carry out any necessary due diligence (checking ownership claim of the seller, charges on the property, permits, etc.) and arrange all the required documents to complete the process (property registration, tax payments, etc.).

A lawyer – Abogado in Spanish – will charge you according to the service you require. This will vary according to the complexity of the purchase. Many charge around 1% of the purchase price in legal fees. Be warned that some lawyers charge 1.5% or more of the sale price, which is a rip off. Even 1% can be unreasonably high given the work that is involved in a straightforward purchase of an expensive property with no legal complications. Your best option is to try and find a good lawyer who is prepared to charge on an hourly basis. Legal fees for a purchase without any complications and charged on an hourly basis should be in the region of 1.000 to 2.500 Euros.

3.3 Spanish mortgage costs
If you choose to purchase with a mortgage, this will only cost one extra cost. The valuation of real estate that the mortgage provider needs before the mortgage is issued. This is paid by the buyer and can cost around 500 euros or more depending on the size of the property. Thanks to the new mortgage law (June 2019), all other costs are borne by the bank that granted the mortgage.

3.4 Spanish notary costs
Notary expenses are nearly always paid by the buyer and are calculated in relation to the purchase price declared in the deeds of sale. To be on the safe side you should calculate Notary fees as being 1% of the purchase price declared in the deeds of sale. In many cases however Notary fees are more like 0.5% (or less) of the price declared in the deeds.

3.5 Spanish Land Registry Inscription Fees
Expenses related to inscribing the sale with the land registry are also nearly always paid by the buyer, and are calculated in relation to the purchase price declared in the deeds of sale. To be on the safe side you should calculate 1% of the purchase price declared in the deeds, though once again it depends upon the property and the area, and the fee could be considerably lower.

4. Other costs associated with buying property in Spain
Though not strictly transaction costs like fees and taxes, there are other costs to bear in mind when buying a home in Spain. After all, they all come out of the same pocket – namely yours.

4.1 Banking Costs
To buy property in Spain you will almost certainly need to open an account with a bank in Spain, and may need to transfer money from abroad. There maybe international transfer costs – check with both banks – and if you need to exchange currency to buy Euros make sure you use a currency broker to get a good rate of exchange and overpaying for Euros.

Once you have got the funds in place, you will need to pay the vendor on the day you complete the purchase. The most common way to do this is to take a banker’s cheque along to the notary’s office to give to the vendor when you sign the deeds.  Banks try to charge as much as they can for issuing banker’s drafts, and I’ve even known them to charge 0.5% of the cheque’s value. However, you can also get them for as little as €50 to €60. It all depends on the deal you have with your bank. Make sure you clarify this with your bank before you ask for the cheque.

 4.2 Furniture Costs
Once you own a property you will need to furnish it. The cost of furnishing a property depends entirely upon what you want. However as a very general rule of thumb a 2 bedroom apartment will cost around 10,000 to 15,000 Euros to furnish nicely if you buy everything new. Of course there is no limit to how much you can spend, though you can also get away with less than 10,000 if you are on a tight budget .

4.3 Plusvalía Municipal Tax
This is normally paid by the vendor, but it can become a problem for the buyer if the vendor fails to pay it. Buyers have to be particularly careful with this tax when the vendor does not live in Spain. See the section below on costs to bear in mind when selling property in Spain for more information. 

Before buying a property in Spain you may also wish to have a building or structural survey done, and that will have a cost. Find out more about building surveys in Spain. 

In Summary, allow for between 12% and 15% of the purchase price in taxes and other costs, though it does depend what and where you are buying.

source : by Mark Stücklin

The Law regulates the entire process of contracting a mortgage, from advertising to its signature, establishing new procedures that will affect both bank employees and their remuneration policies, as well as the client, who will have to make an extra effort to demonstrate that ‘Know what is done’ when signing a loan. For this reason, you should know the rule well. These are the 15 questions, with their answers, that will facilitate the task.


Before beginning any type of negotiation, the bank is obliged to carry out a solvency test, at no cost to the client, which will be much more demanding than until now. For example, in the case of couples, if one of the two does not meet the established requirements they will not be able to access the mortgage.

According to experts, the entities may not exceed the minimum established by each bank to grant a loan. These minimums will now be calculated with a greater weight of equations such as the ‘loan-value of the property’ or the ‘debt-income’ of the client, with a lower weight of other factors such as guarantees. The financial institution is required to review these data periodically, keeping a record that will be supervised by the Bank of Spain.


Banks can no longer limit themselves to the advertising leaflet to report the conditions of their mortgages. In the pre-contractual phase, entities have to deliver two new documents, the European Standardized Information Sheet (FEIN) and the Standardized Warning Sheet (FiAE). The regulator thus replaces the old FIPER, in which only the mortgage information adapted to the applicant’s economic conditions was included.


In general terms, the FEIN includes personalized mortgage information, while the FiAE will contain data on clauses (early maturity, for example) or relevant elements such as the distribution of loan expenses.

The FEIN includes data such as the commission the lender receives, the amount, duration and currency of the mortgage, with a simulation of the fluctuations that may arise if signed in a currency other than the euro (and that the bank must update from periodically).

The bank must also provide the customer with the repayment schedule of the loan interest rate, in addition to the amount of each installment and its periodicity. These documents also include a simulation of how the interest of the mortgage will vary before different scenarios of evolution in interest rates.


The client must receive all this documentation at least 10 days before writing. The term has been such an important aspect for regulators that, if it is proven that the mortgage has been signed before those 10 days, it will be declared void. The idea is for the client to use that time to consult, ask and ask any questions about the loan he is about to sign.


With the new norm, the client will visit the notary he chooses twice. The first meeting will be in the ten days prior to the signing of the deed. On this first visit, the notary will perform a ‘test’ to the client to make sure he knows all the points of the contract. Without the “ok” of that document, the applicant will not be able to receive the deed of the dwelling. In the same way, if it is detected that the notary has not done his informative work, he will be sanctioned.


No. The notary will write his notarial certificate for free, recording the questions and answers he has made to the client, as well as the explanations added.


The client must present to the notary the draft contract of the loan, the FEIN, the FiAE, the simulation of the periodic installments (and the different scenarios of interest rate evolution), in addition to the document in which the expenses are reflected associated with the public deed of credit. All this documentation must be sent from the bank to the notary electronically. The Government has given a period of one month and a half more to the bank to use the digital platform of the notaries to send all this information. As explained by the Ministry of Justice last Friday, the modification does not paralyze the Mortgage Law or the formalization of new loans, as a transitional regime is created for clients and banks to communicate with notaries through other channels.


Once the notarial act has been drafted and signed, the so-called contractual phase begins, with the authorization of the deeds of the sale and the loan, which are usually signed simultaneously. This is the last moment to clarify any doubt that the client has, because once the deeds are authorized by the notary, it will not be possible to go back.


In addition to reading all the documentation from top to bottom, the notary is the figure that must detect if the entity has included an abusive clause in its conditions, checking it in the General Register of Contract Conditions.

With the real estate credit law, the land clauses disappear and the text specifically prohibits the application of a minimum interest in variable rate mortgages. In the case of non-payments, the rule allows ordering an eviction when the customer owes 12 monthly payments or 3% of the capital granted, during the first half of the duration of the loan. During the second half of the life of the loan, the execution will be carried out if the client stops paying 15 months or 7% of the loan.


Until now, the client paid the costs of agency, notary, housing registration and appraisal. As of Monday, the first three will be paid by the bank. According to the calculations of, this can mean savings to the citizen of between 500 and 1,000 euros on average, depending on the amount of the loan. Anticipating the norm, banks have for months assumed the tax of documented legal acts (AJD), which until recently the client paid.

The appraisal of the home is the only expense that will be borne by the client, which may be chosen by the company you want without the need to be that of the same bank in which you sign the mortgage. However, there are eight entities that already assume that cost (some even if it is done with another bank): Santander, CaixaBank, Ibercaja, BBVA, ING, Banco Pichincha, MyInvestor and Openban.

Copies of the mortgage loan deeds will be paid by the person requesting them, except for the simple copy that the notary will send to the client’s email (free of charge).


In principle, the rule prohibits the linking of products to the contracting of a mortgage loan. However, made the law, cheated. The text does allow to apply bonuses on the loan differential for each product that is contracted with the bank.
In the case of home insurance, the client may present a policy from another entity with the same or better conditions and his bank will have to accept it without making the proposed offer worse.


Yes. The law does not prohibit the collection of this commission, but it does establish that it will be the only one, so the study commission is out of the equation.


The rule has introduced changes to facilitate the change from one mortgage to another, or the negotiation of new conditions. Although it does not say it specifically, the rule reflects an obvious commitment of regulators for the passage of variable mortgages to fixed-rate mortgages. Specifically, whether the change is made by subrogation to another entity or by novation, the commission may not exceed 0.15% of the capital repaid in advance during the first 3 years of the term of the loan contract. Afterwards, the bank cannot demand any commission.


If the client wants to return all or part of his loan before the established time, the norm establishes that, in the case of fixed-rate mortgages, the commission may not exceed 2% of the anticipated capital (not on which it is still pending ) during the first 10 years and 1.5% from the eleventh year. For variable rate mortgages, the cost may not exceed 0.25% of the anticipated capital during the first three years, or 0.15% of the first five.


No. All deeds prior to June 16 are governed by the old regulations. Therefore, they will not be able to claim the expenses they paid when they formalized their mortgage or request the refund of the tax of documented legal acts (AJD).

Of course, who has a mortgage already signed yes can benefit from the limits of commissions in cases of subrogation or novation of the loan.

Similarly, the Ministry of Justice announced on Friday that mortgages whose binding offer has been delivered with the requirements of the old law, but which will be raised by public deed after the new one comes into force, can only be formalized with effects of the previous regulations the mortgages in which it is credited that the borrower has accepted before Sunday. If it is not accredited, the new regulations will apply.

source :

Everyone owning a property in Spain, despite residency status, etc., has to pay the following two taxes to the local authorities (Ayuntamiento or Patronato de Recaudacion):

“Impuesto de Bienes Inmuebles”. This is the Local Property Tax  or Council Tax. Some people call it the “rates”. It is based on the official value “valor catastral” of your property. Obviously the amount can vary a lot depending on the size and location of your property, but a “normal” 2 bedroom aparmtent should pay something between 400 and 800 Euros per  year.

“Tasa de Recogida de Basuras”. This is what you pay to the Town Hall for collecting your Rubbish. Approximately 80 Euros for apartments and up to 200 Euros for a villa.

If your property belongs to a Community of Property Owners (Commonhold Community Associations), as is the case for most properties in Spain, and will certainly be the case for apartments, you will have to pay your share in the maintenance costs of the complex: electricity and water for common areas, insurance, employees wages, etc. The payment of this fee is compulsory and the Community of Owners might take you to court if you don’t pay. You also need to be aware that from the moment you signed the title deed, you committed yourself to respect the community rules. You will also have the right to participate and have your say in the Annual General meetings (AGM) or Extraordinary General Meetings (EGM).

If you are non resident, you will also have to pay the Income Tax for Non Residents, even if you don’t obtain any income at all from your property.The obligation stems from being an owner of a property and a non-resident, as the law considers from these facts, that you are getting a deemed income. It doesn’t matter whether you rent your property out or not, even if you don’t receive any real income as such, you are still obliged to present this tax declaration.

Please don’t confuse the Council Taxes with the Income Tax for Non Residents. Council taxes have to be paid by everyone, despite residency status, and the latter must be paid only by non residents. If you are non resident you have to pay both.

Finally, please be aware that it is highly advisable that you take out home insurance for your property in Spain, in order to cover your contents and your Public Liability, as these things won’t be covered by the community insurance.

source :

1. How much are your fees for the quarterly and annual declarations?
Accountants charge on average 135,00 Euros +  IVA (163,35 Euros) for each quarterly declaration if the property has two owners (two tax submissions) and 110,00 Euros + IVA (133,10) if there is just one property owner (one tax submission). They will normally charge the same for quarterly declarations on rental incomes than for the annual declaration. For quarterly declarations with negative result (no need to submit tax declaration) it is possible they charge 80,00 Euros + IVA (96,80).

2. How are the rental incomes rated?
For Non Residents in Spain that reside in other EU countries (plus Norway and Iceland, and for the time being the UK) this type of income is rated at 19%. Residents in Non EU countries pay 24%

3. What expenses can be deducted? Citizens of EU members, plus Norway and Iceand, can deduct the following expenses:
Community Fees, Council Taxes, Insurance, water, electricity, mortgage interests, real estate agent fee, cleaning & laundry, maintenance and reparation costs. Please note that this is not a closed list, but these are the expenses that shouldn’t be questioned by the tax Office. You can only deduct the proportional part of the expenses corresponding to the number of days the apartment is rented.
The purchase of furniture and appliances can be deducted as well, but is not dealt with in the same way as the maintenance expenses, it is considered as a fixed asset (“inmovilizado”). This means that the full amount paid for the item cannot be deducted immediately, but only a portion is deductible per year (for a period of several years depending on the item purchased). Therefore, if you have paid for a new Television, sofa or fridge freezer, etc. you will need to provide us with these details and we will apply the correct amounts in accordance with the requirements of the local Tax Authority.

Please note that you can NOT deduct expenses if you are not in possession of a proper INVOICE (quotations or “albaran” are not valid”)

Please note that you can NOT deduct travel expenses to/from Spain

Residents in Non EU countries (except Norway and Iceland) can NOT deduct any expense.

4.  I am resident in another country. Do I still have to pay this tax in Spain? Even if the property in a company’s name?
Yes. This is the Income Tax for Non Residents. According to the Spanish law, incomes obtained from the rent of a property situated in Spain, must be taxed in Spain. There are agreements in place to avoid double taxation between Spain and most of the European countries, so you will not have to pay twice (whatever you pay in Spain will be deductible off whatever you have to pay for the same income in your country).

5. How often do I have to declare and pay for these incomes?
Unlike residents in Spain, who declare their rental income together with their other income in their annual tax return, Non Residents must submit a declaration every 3 months, according to the following calendar:

  • Incomes obtained in January, February and March: declaration by the 20th of April
  • Incomes obtained in April, May and June: declaration by the 20th of July
  • Incomes obtained in July, August and September: declaration by the 20th of October
  • Incomes Obtained in October, November and December: declaring by the 20th of January, and so on. This is also the moment to declare the negative outcome of any quarter corresponding to year 2017 (i.e. a quarter where you have rented our the property, but with a negative outcome)


You also have to file an annual tax return by the end of each year, corresponding to the previous year (by the end of 2019 you have to declare for 2018, by the end of 2020 for 2019, etc.), even if you obtain no income at all from the apartment.

6.  What happens if I pay late?
The deadlines are very clear in the previous question. If you pay just one day late, the Tax Office will send you a fine for: 

5% (if the payment is made within the three months following the deadline),

10% (if more than three months pass, but less than 6)

15% (between 6 and 12 months) and

20% plus interests if you pay more than one year late.

If you want us to pay this fine for you, we will charge 50,00 Euros + VAT. So, as you can see, it is very important that you pay on time.

7. I pay every year Income Tax for Non Residents (form 210). Does this cover the tax due for the rental incomes?
No. If you have been filing an annual declaration with the form 210, always paying a similar amount, you have NOT been declaring the rental incomes, but paying a fixed amount on a “deemed” income, just for the fact of being Non Resident and owning a property in Spain. The rental incomes must be declared quarterly (if there have been incomes in that specific quarter) and obviously the amount will always be a percentage on the profit (19%). However, you will never pay tax twice for the same period, i.e. when you do your Annual Income Tax Declaration, you will pay only for the days that the apartment was not rented out, if any, because you have already paid for the rental incomes in the quarterly declarations.

8. I have not received the electricity and water bills yet. Can I deduct an approximate amount?
No.  According to the Tax authority you can only deduct the electricity and water bills once you have received them.

9. I have not received the Council Tax bills (Rates and Rubbish Collection fee) yet. Can I deduct them?
Yes, you can deduct the proportional part, considering the same amount as last year if you don’t know the amount of the present one yet.

10. From when do I have to declare the Rental Incomes?
The obligation to declare the rental incomes has always existed. It Is not a new thing that came with the new holiday rental regulation.

11. If I start declaring my rentals now, does the Tax Office assume that I have been renting out my property in the past? Can they ask me to pay taxes for the last years?
Well, honestly we can’t foresee what the assumptions of the Tax Office will be, but in any case, they would have to prove that you have been renting out your property in the past. Based on the various messages sent out by the fiscal authorities, the idea is that people start paying and there’s no reason to believe that investigations will be carried out on every new rental tax payer. It wouldn’t make sense for them to investigate every new case, as the Tax Office doesn’t want to make people afraid of paying taxes.

12. I have not rented out my property in the last quarter. Do I have to file any declaration now?
Not for rental incomes, but remember that you have to file, and pay, every year the Income Tax for Non Residents (yearly, not quarterly). If you rent out the property but you have a negative outcome, i.e.  you have more expenses than incomes, you don’t have to submit a quarterly declaration, but you will have to present a annual declaration declaring that loss. (between the 1st and the 20th of January each year)

13. What figure should I consider as the income: the amount paid by the tenant/guest or what I actually receive after the commission of the estate agent?
You have to declare the amount paid for the rent by the tenant/guest, and you can deduct the commission or fees charged by the rental estate agent. But the income is the total amount paid by the tenant.

source :

Investing in real estate on the Spanish Coast is a safe way to invest.

House prices continue to rise every year. So if you decide to sell your property in the future, you’re definitely doing a good job.

This also has a positive effect on the long-term return on your investment. Not only does the value of your property increase, your monthly rental income also increases every year.

If you want to enjoy maximum rental income, it is best to invest in a new or renovated home in a good location. If you also ask for a competitive rental price, you will probably get the most return from your real estate investment.

It is important to take into account when calculating your return

1.One-off purchase costs :

  • registration fees / VAT
  • fee notary
  • lawyer fees / gestoria
  • deed costs
  • costs for renovation
  • furniture 

Example (*)

220,000€ = Purchase price

22,000€ = 10% ITP (transfer tax) or VAT

2,200€ = 1% Notary fee

2,200€ = 1% Lawyer fee

2,200€ = 1% Deed costs / registration

28,600€ = Total Costs (+/- 13% of purchase amount)

248,600€ = Total Purchase Cost

0€= Renovation / beautification costs (not applicable for new construction)

15,000€ = Furniture and furnishings

15,000€ = Total Extra Costs


   2. Annual / monthly recurring costs :

  • property tax
  • rental costs
  • maintenance costs

As a standard, we take into account 2 months of rental income per year to cover the annual / monthly recurring costs. Depending on the property and rental market purchased, this may be lower or higher. There are 2 possibilities to offer your property on the rental market:

  1. Long Term Rentals
    1. Smaller Investment (can also be rented unfurnished, we rent out your investment property for FREE and you only pay management costs when you engage us to act as an intermediary)
    2. Normal rental income
    3. Less Risk
    4. Less Work (administration / management)
  2. Holiday / Short Term Rentals
    1. Greater Investment (successful rental of your holiday home depends on several factors: location / visibility, attractive furniture / furnishings, commercialization of the house via various websites, management, cleaning, etc.)
    2. Higher rental income possible (ask in high season per week what you would ask per month in the long term)
      1. More Risk (possibly not rented all year)
    3. More Work (you can manage this yourself in collaboration with key management or have it carried out by a specialized company for rental and management of holiday homes)

How do you calculate the return and annual added value of your investment property? (*)

Total cost to make your home ready for long-term rental: 248,600 €
Gross Rental Income: 800 € / month x 12 months or 9,600 € per year
Net Rental Income: 800 € / month x 10 months or 8,000 € per year

  • Gross Return = (800 x 12) / 248,600 = 3.86%
  • Net Return = (800 x 10) / 248,600 = 3.32%

The annual added value of a property is calculated on the purchase price excluding costs.

Purchase price (without costs): 220,000 €
Annual Added Value of Real Estate: 2 to 5% (depending on location)

  • Added value at an A location = 220,000 x 0.05 = 11,000 €
  • Added value at a B, C location = 220,000 x 0.02 = 4,400 €


Interest rates on mortgage loans are still historically low. It is therefore interesting to use a mortgage loan for your real estate investment. If there is a mortgage on the main house, you can reactivate the amount already paid to invest in the purchase of a second house in Spain. A mortgage can also be applied for in Spain.

Consult your Immoservice advisor to invest in the property that best suits your needs and expectations.



(*) The examples are purely informative. Percentages, fees, deed and registration costs may fluctuate depending on the province, resale / new construction, executive notary and lawyer / gestoria.

Compare listings