Taxes to pay when buying a house in Spain
Patrick Gordinne Perez2025-01-15T06:46:25+00:00Many clients ask us what are the taxes to pay when buying a house in Spain…. if I am Belgian, if I am French, if I am Swedish, if I am English, if I am German, if I am Dutch, if I am Polish, etc.
In this article, I want to make it clear that the taxes to be paid when buying a house in Spain are based on the value of the house and on the place where the house is located and never on the nationality of the buyer.
To sum up
Everyone who buys a property in Spain pays the same.
Whether they are Spanish or foreigners
There is no difference in the payment of tax to charge a house in Spain depending on the nationality of the buyers.
However, there is a difference if you are resident for tax purposes in Spain or if you are not resident for tax purposes in Spain and fall into one of the following categories. In effect
People who have tax residence in Spain and who have some kind of disability, who have a large family, who have been victims of gender violence or who are young people under 35 years old and buy their first home, pay a lower tax.
But I insist, it has nothing to do with nationality.
If you are Belgian and have your tax residence in Spain you will be able to benefit from the tax reduction.
Now that it is clear that everyone pays the same when buying a house in Spain, let’s take a closer look at what taxes are payable when buying a house in Spain.
What do the taxes paid when buying a house in Spain depend on?
Here we have to differentiate three things:
If the house is new or second hand
Where is the house?
Depending on the community in which the property is located, a different percentage of taxes will be paid.
And the value of the house
The tax payable on the sale of a house is a percentage of the value of the house.
Very important
The tax payable on a second-hand house is a percentage of the higher value between the market price and the reference value.
Where do you sign for the purchase of a house in Spain?
This is the normal legal procedure for buying a house.
I say legal because I don’t take into account everything that real estate agents do.
Visits to the house, negotiation, revisit, etc.
In general the purchase of a house in Spain consists of the following phases
- First, a private purchase contract is signed between the parties in which all the conditions of the purchase are established.
Basically, a private contract of sale sets out the conditions of the following
- Price
- Methods of payment
- Date of signature at the notary’s office
- Who pays what
- Who stays in the house
- In short, the conditions under which the house is bought.
The purchase contract is usually drawn up by the real estate agency or the buyer’s representative (advisor or lawyer).
- The deed of purchase is then signed at the notary’s office.
- Taxes are paid
You have 30 days to pay the ITP or AJD, the VAT is paid directly to the promoter. Later we will expand on the taxes, which is what this article is about.
- Registering the title deeds in the land registry
You have 18 months to register the deed in the land register.
Did you know that notaries in Spain do not receive money for the purchase of a house?
What taxes are paid when buying a house in Spain?
Now, after a brief introduction, we will analyse the taxes to be paid when buying a house in Spain.
Here we have to differentiate whether the house is new or second hand.
If the house is new, you pay :
- VAT
VAT in Spain on a new property is 10%.
- The stamp duty (AJD)
The AJD varies between 0% and 1.5%.
If the house is second hand:
You pay the Impuesto sobre Transmisiones Patrimoniales, the ITP goes between 6% and 13% depending on the community.
In the following we will develop this a little more.
What taxes do I have to pay when I buy a second-hand house in Spain?
In Spain there are several taxes that are derived from the communities, that is, it is the autonomous communities that decide the percentage of the tax to be paid and collect these taxes directly.
In other words, the money collected by the autonomous communities for the ITP goes directly to them, they do not go through the tax authorities.
The main tax paid when buying a second-hand house in Spain is the transfer tax, colloquially known as ITP.
The calculation of the ITP is a percentage of the value of the house.
The value of the house is the taxable base for the transfer tax.
Remember that the value, on which the tax is paid, is the higher value between the market price, i.e. the extra established between the parties, and the reference value.
If the market value is higher than the reference value, this market value will be taken as the taxable base.
And if the reference value is higher than the market price, the reference value will be taken as the taxable base of the tax.
And each community can set the percentage of ITP that they want to charge.
Below you can see the percentage of ITP that is paid in each community.
The deadline to pay the ITP in Spain is 30 calendar days after the signature at the notary’s office.
It is paid by means of form 600 of each community.
It can be presented and paid online or you can pay directly at the banks and present the form 600 at the settlement offices of the land registries of each city or town.
Did you know that Asesoria Orihuela Costa helps and advises you in everything related to the purchase of your home?
What percentage of tax is paid on a second-hand house in Spain?
Let’s get straight to the point and here you have the general table of the percentage of transfer tax paid in Spain.
As we have said before when buying a house in Spain you pay a different percentage of tax depending on the autonomous community in which the house is located.
Below you can see the general rates of ITP in each autonomous community in Spain:
Autonomous Community | ITP |
Andalusia | 7% |
Aragon | 8 – 10% |
Asturias | 8 – 10% |
Balearic Islands | 8 – 13% |
Canary Islands | 6,5% |
Cantabria | 9% |
Castile-La Mancha | 9% |
Castile and Leon | 8 – 10% |
Catalonia | 10 – 11% |
Ceuta | 6% |
Community of Madrid | 6% |
Valencian Community | 10 – 11% |
Extremadura | 8 – 11% |
Galicia | 8% |
La Rioja | 7% |
Melilla | 6% |
Murcia | 8% |
Navarre | 6% |
Basque Country | 7% |
These percentages can be reduced if you are a tax resident in Spain and if you are in any of the cases established by the community.
For example, large families, if you have a disability, if you are a young person under 35 years of age and are buying your first home, if you have been a victim of gender violence, or if you are going to buy a state-subsidised property.
In this article you can see what is new in the ITP of the Valencian Community and the ITP of the Region of Murcia in 2024.
Did you know that the Popular Party (PP) has proposed that young people under the age of 35 who buy their first home should pay 4% ITP instead of the current 8%?
What taxes do I have to pay when I buy a new home in Spain?
In the case of new housing, two taxes are paid:
VAT at 10 %.
You pay this VAT directly to the developer or builder.
Normally the payment to the builder is made in several times, and each time you make a payment to the builder, you will have to add the VAT of 10%.
And the Actos Jurídicos Documentados colloquially called (AJD).
The AJD is paid 30 days after signing the purchase of the house at the notary’s office.
What percentage of stamp duty is paid in Spain when buying a house?
Like the ITP, the tax on legal documents depends on the autonomous community in which the house is located.
Andalusia | 1,2% |
Aragon | 1,5% |
Asturias | 1,2% |
Balearic Islands | 1,2% |
Valencian Community | 1,5% |
Canary Islands | 0,75% |
Cantabria | 1,5% |
Castilla-La-Mancha | 1,5% |
Castile and Leon | 1,5% |
Catalonia | 1,5% |
Ceuta | 0,5% |
Extremadura | 1,5% |
Galicia | 1,5% |
La Rioja | 1% |
Community of Madrid | 0,75% |
Melilla | 0,5% |
Region of Murcia | 1,5% |
Autonomous Community of Navarre | 0,5% |
Basque Country | 0,0% |
Why is the taxable value of a house purchase the higher of the market value and the reference value?
For many years, there was a great controversy about the value of houses.
Let’s remember that the tax you pay when you buy a house, the Itp, is a percentage of the value of the house.
This controversy stemmed from the fact that the market valued the house at one price and the state at another.
Especially during the subprime crisis, the market value was far below the value established by the autonomous communities.
The state imposed a system of value verification, in which it collected a lot of money, increasing the value of the house via inspection.
The lawyers somehow managed to overturn all these liquidations, basically, what they said was that the tax authorities did not go to the house personally, they had not seen the house for the valuation, but that their valuation was based on coefficients and complex calculations.
Because the tax authorities could no longer settle, they established a definitive valuation system that we use today.
This is the so-called reference value.
What is the market value of a house in Spain?
It is the price that has been freely agreed between the buyer and the seller.
The taxable base of a house is the value on which the percentage of the tax is calculated.
We remind once again, because it is very important, that the taxable base of the tax payable on a purchase of a house in Spain is the higher value between the market price established between the parties and the reference value established by the cadastre…
What is the reference value?
The reference value is the value of a house as calculated by the cadastre in Spain. That is, the cadastre calculates values of houses in Spain.
In general, all houses for development have a reference value.
On the other hand, local rural properties and houses and garages do not usually have a reference value.
Every year, the cadastre establishes a value for each property.
To know the reference value, youhave to go to this link of the cadastre, identify yourself and put the cadastral reference of the house.
In this article Valor de referencia: Clave para tus impuestos y gestión patrimonial we explain in more depth what the reference value is.
To sum up
If the property is new, VAT and AJD are paid.
If the property is new, ITP is paid.