Costs of buying a property in Spain

• Perfect Property in Spain is contracted by the buyer and will be paid the agreed fee on the day of completion of the sale.
• Lawyers’ fees are usually 1% of the purchase price plus 21% VAT (IVA) but could vary depending on the complexities attached to a property purchase.
• Notary fees are set by the Tariff & Regulatory Fee and are usually between 0.5% – 1% of the price declared in the title deeds.
• Registry fees are also set by a tariff. Allow for 1% of the value on the deeds.
• Transfer tax is 8% of the purchase price under 400,000€. 9% between 400.000€ and 700,000€ there after it increases to 10%. When buying a new property from a developer the purchase tax is replaced with 10% VAT (IVA) plus 1.5% stamp duty. However, if you are buying a plot of land or a commercial property then 21% VAT (IVA) will be added.
• Bank costs you will need to write perhaps several banker’s cheques or pay for money transfers. Allow 0.5% of the amount to be transferred some banks may waive some of this amount should you decide to take out a home insurance or other financial products with them.
• Mortgage costs if you require a mortgage then you will need to account for a valuation approx. 500€ plus the arrangement fee. There will be additional notary fees as you will need to sign a separate title deed for the mortgage

Runnin​g Costs

• IBI (Property Ownership Tax) known as ‘contribución urbana’ is a local annual tax based on the ‘valor catastral’ the cadastral value of the land and building. This value often does not match the market value or even the value stipulated on the title deeds. The rate is decided by each municipality and will vary considerably.
• Rubbish Collection Tax (Tasa de Recogida de Basuras) This tax will vary depending on the type of property and the location. The rate is set by the local council and is usually paid once or twice a year.
• Water and Sewerage Rates (Tasa de Abastecimiento de Agua y Alcantarillado) This is normally a quarterly payment and the rate is set out by the local council and is based on water consumption. In some case water rates are paid as part of the community fees.
• Community Fees If the property is part of a community or urbanization with shared communual areas such as swimming pools, spa, gardens, internet/WIFI, garages/parking, along with entrance halls and corridors these all must be maintained by the community which is set up once the building or development has been completed. The administration of a community is decided by the property owners at the AGM where a president and vice president will be elected and normally this responsibility is rotated between all of the property owners. The accounting is normally carried out by a Gestoria (management agency that takes care of administrative procedures, finances and paper work). The community fees and how often they are paid are set out by the community office.
• I ncome Tax for non-residents (IRNR, Renta de No Residentes) If the owner rents the property they must pay 20% of the rent (24% if the tenant is a non-EU citizen). If the owner uses the property, he or she must pay 20% of the 1.1% of the cadastral value (2% of the value if it has not been revised since 1994). For non-EU citizens the rate is 24%.
• Income Tax for residents (IRPF, Renta de las Personas Físicas): Any person who is a resident in Spain for more than 183 days per calendar year will have to file and declare all of their Income Tax annually, regardless of where the income was generated.
• Electricity is a monthly payment and the bill is broken down into two sections. The first is a basic rate payable whether the property is occupied or not and the second is the consumption which is metered.
• Landline telephone and Internet there are many local providers with different rates and packages that may include cable TV services. These are normally monthly payments.