mallorca property fees tax Spain fees

 

FEES CONNECTED WITH BUYING A PROPERTY

When you have finally decided on the home of your dreams, you should not forget the fees connected with buying this property. This amount will be approximately 10 % of the "declared" purchase price.

What taxes are due to purchase a property?

There are two different taxes, depending on the type and circumstances of the property that you are buying.

In case of purchasing a newly built property from a developer you pay VAT called " IVA : Impuesto sobre el valor añadido", which will be 7 % + 1 % Stamp Tax of the contract price or 16 % on land.

When you are purchasing a resale, you will pay a transfer tax called " I.T.P - impuesto de transmisiones patrimoniales ", which is charged on 7 % of the declared price.

Another tax that has to be paid is the Municipal Plusvalia. This is a tax set by the local Town Hall and based on the increase in the value of the land and property from the date the owner acquired the property to the time of the present sale. Mainly paid by the seller. This is a separate tax, and is not included in the 10 % of the purchase fees.

What are the additional fees? for a property

The Notary Fees

These fees are collected by the Notary for preparing the Title Deed called "Escritura Pública de Compra/Venta" and presiding over of the signing. The fees will be approximately 1%.

After purchasing the property, the notary will give you a copy of the deed (Escritura) which says that you are the new owner of the property. The original deed will be send to the Land Registry Office.

The Lawyer Fees

We can put you in touch with a Spanish lawyer English speaking who will charge a competitive rate.

They can give you legal and fiscal advice on real estate investments or help you with economic transactions with foreigh countries or project development of non residents.

The lawyer can also arrange a Foreigners Identification Number called " NIE - Numero de identificación para extranjeros " for you. This document is essential for major purchases like buying a property and tax payments.

To apply for the NIE, you need a photocopy of your passport, confirmed by a notary that it is an original copy and a form, which can be downloaded at:

James mallorca uk mobile email   Propertycasa@gmail.com      if you need some local advice then email us with your full contact details.    

The Property Register Fee

Approximately 0,5 % is charged by the Land Registry Office called " Registro de Propiedad " to register the new deed (Escritura) into your name.

When this is completed, you are lawful the owner of the property.

Mortgage in Spain or at home?

Getting a mortgage in Spain has some advantages, like the interest rates in Spanish Banks are varying, but most of the times lower than at home, it has favourable write off conditions and it is easier for paying taxes. So it is recommended to take a mortgage in Spain. Anyway you have to open a Spanish account for the fixed costs, like water, electricity, insurances and in case you bought a property in a complex, the communal fees. It can save you a lot of commissions caused by international bank transactions.

Do I have to pay a deposit on a house?

It is quit common to pay a deposit in Spain, to remove the property of the market while you are arranging the legal part. The standard deposit is 10 % of the purchase price. In this case both sign an Option Contract (Opción de Compra).

The deposit has advantages for the buyer as well as for the seller. In case you decided to pull out of the deal you lose the 10%. On the opposite, if the owner pull out of the deal he has to compensate double the 10 % of the deposit.

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