The Property Buying Process in Spain

4. Taxes, Fees, and Costs for Buyers

Understanding the financial obligations beyond the purchase price of a property is crucial for buyers in Spain. The total cost of buying property includes various taxes, fees, and costs, which can significantly affect your budget. Platinum Legal Spain specializes in guiding our clients through these financial aspects, ensuring a transparent and stress-free transaction.

Transfer Tax (Impuesto de Transmisiones Patrimoniales – ITP)

For resale properties, buyers are required to pay the Transfer Tax, which varies by autonomous community, typically ranging from 6% to 10% of the property’s declared value.

VAT (Value Added Tax) and Stamp Duty

For new build properties purchased directly from a developer or builder, buyers must pay VAT (IVA in Spain), which is currently set at 10% for residential properties and 21% for plots of land and commercial premises. Additionally, Stamp Duty (Actos Jurídicos Documentados – AJD) applies, usually ranging from 0.5% to 1.5% depending on the region.

Notary Fees

The signing of the public deed of sale (Escritura) must be done in the presence of a notary. Notary fees are regulated by law and are based on the property’s sale price, ranging approximately between €600 and €875, though this can vary depending on the complexity of the transaction.

Land Registry Fees

After the sale, the new deed must be registered with the local Land Registry (Registro de la Propiedad). Like notary fees, these are based on the property price and can range from €400 to €650.

Legal Fees

Hiring a legal advisor or solicitor to navigate the property buying process is highly recommended. Fees for legal services can vary, typically ranging from 1% to 2% of the purchase price, depending on the complexity of the transaction and the services provided.

Bank Costs

If you’re financing your purchase with a mortgage, expect to encounter bank-related costs, including valuation fees and mortgage setup fees. Additionally, there are bank charges for transferring funds internationally and setting up a bank account in Spain, if needed.

Other Potential Costs
Property Valuation: Before granting a mortgage, banks require a property valuation by an approved appraiser, which can cost between €300 and €600.
Surveyor Fees: While not mandatory, having a survey done on the property can provide peace of mind, especially for older properties. Costs vary depending on the property size and type.

Conclusion

The additional taxes, fees, and costs associated with buying property in Spain can add a significant amount to the overall investment. Platinum Legal Spain offers expert advice and comprehensive services to manage these financial aspects on behalf of our clients. Our goal is to ensure you are fully informed and prepared for all costs involved, making your property purchase as straightforward and stress-free as possible.