Introduction

Are you planning to buy a property in Spain? In addition to the purchase price of your property, you'll need to pay a number of taxes and fees. The experts at Terreta Spain take stock of the situation. 

ITP 

This is the tax most familiar to buyers, theImpuesto sobre las Transmisiones Patrimoniales (Property Transfer Tax). We've devoted a very detailed fact sheet to it, but here's what you should know about it: 

• It's a one-off tax.
• It applies to all properties purchased in the past.
• ITP is a regional tax, so its rate varies according to the autonomous community in which the property is located. It ranges from 6% to 13%. 

To find out more, consult our practical information sheet on ITP.

Advice from the experts at Terreta Spain :

• Find out about any discounts that may be available. Some regions have special regulations for first-time buyers or large families, for example.
• If your aim is to invest for maximum profitability, target autonomous communities where the ITP is lower. The capital, Madrid, is an excellent choice. Property Transfer Tax is 6%, demand is exploding and rental vacancy rates are very low. 

IVA and AJD

The IVA is the equivalent of VAT in Spain, theImpuesto sobre el Valor Añadido. The IVA applies to new-build properties , and always amounts to 10% of the purchase price in the case of residential property.

In addition to IVA, AJD is payable on documented legal acts. It is marginal, amounting to between 1% and 1.5% of the value of the property, depending on the Autonomous Community. 

If you buy land or commercial premises, the IVA rises to 21%.

Notary fees 

• In Spain, notary fees are not very high, as the notary's role is limited to certifying the legality of the transaction and officially registering the transfer of ownership. 
• They depend on the value of the property and generally vary between €500 and €2,000. 

Administrative management fees

When buying property in Spain, it's common practice to use a gestoria, a specialized agency that takes care of all the administrative formalities involved in the purchase, such as paying taxes. This usually costs between €200 and €400. 

Lawyer's fees

If you use the services of a lawyer specializing in Spanish real estate law - which is not compulsory, but advisable - you should take into account his or her fees. They represent around 1% of the purchase price, plus 21% VAT. 

Bank charges

If you're planning to take out a bank loan, don't forget to add any associated costs. 

• Expect to pay between €350 and €500 for tasación, the expert valuation of the property. This is required by the banks. To find out more, read our practical information sheet on the subject. (to be integrated once published).
• Add between 0.5% and 1% of the amount borrowed for bank charges on average. 

Total estimated ancillary costs

It is estimated that property purchase costs in Spain represent between 10 and 15% of the property price.

Sources: Idealista, Terreta Spain