Selling property in Spain
A Spanish property sale should be prepared legally and tax-wise before a reservation or arras agreement is signed. This is particularly important for non-resident sellers, mortgaged property, inherited property and property subject to an existing lease.
Documents
The title deed, Land Registry and cadastral information, recent IBI receipts, energy certificate and, where applicable, owners' community documentation normally need to be reviewed. Existing mortgages and other charges should also be identified and coordinated with the sale.
Arras and payment
The parties frequently sign a private arras agreement before completion. The seller's obligations before the notarial deed and the consequences of non-performance should be clearly regulated.
Selling rented property
A sale does not automatically terminate an existing residential lease. The position of buyer, seller and tenant depends on the lease, the date on which it was entered into and the applicable statutory rules.
Taxes and costs
A sale may trigger tax on a capital gain and the municipal land value tax known as plusvalía municipal.
Where the seller is a non-resident, the buyer must generally withhold three per cent of the agreed consideration and pay it to the Spanish tax authorities on account of the seller's tax liability. This is a payment on account rather than an additional tax.
Other seller costs may include estate-agent fees, cancellation of existing charges, required certificates and the cost of legal advice retained by the seller.
How we can help
We review the legal and tax position, prepare or review contracts, coordinate the required documentation and assist through completion and the subsequent tax process.