If you have purchased a property in Spain and are considering selling it, be aware that you will be subject to capital gains tax, Impuesto sobre el Incremento de Patrimonio or Ganancia patrimonial. This tax applies to the difference between the purchase price and the resale price of your property.
The tax rates vary depending on the tax status of the owner (tax resident or non-resident) and the length of ownership. There are cases of exemption, especially if you reinvest your money in a primary residence on Spanish territory.
Definition
The tax on capital gains on real estate in Spain has two components:
- The national tax (IRPF for residents/IRNR for non-residents) on the capital gain.
- The municipal capital gains tax (IIVTNU or the plusvalia municipal), which is calculated on the valuation of the land on which the property is built.
Calculation of the national tax
Taxable base
Net capital gain = sale price – (purchase price + acquisition costs + sales costs + justified works)
Tax rate
| Tax status | Tax brackets |
| Residents | Progressive: 19% (≤6K€), 21% (6-50K€), 23% (50-200K€), 26% (>200K€) |
| Non-residents | Fixed rate: 19% (EU/EEA), 24% (outside the EU) |
Terreta Tip: Click here to access an IRPF simulator, in the original version “simulador de ganancias patrimoniales”, if you are a Spanish tax resident.
Calculation of the municipal capital gains tax (IIVTNU)
Two methods to choose from
- Real method: 60% x the national capital gain.
- Objective method: cadastral value × annual coefficient × municipal rate (generally 0.9% per year).
Payment methods
For residents:
- Integration into the annual IRPF declaration.
- Payment before June 30 of the following year.
For non-residents:
- 3% withholding tax retained by the buyer during the sale. The purpose is to prevent capital flight.
- Mandatory declaration within 4 months via form 210.
- Regularization between withholding tax and actual tax.
The municipal capital gains tax is the responsibility of the seller, and the payment deadline varies depending on the municipality (generally 30 days post-sale).
Partial or total exemptions
| Cases of exemption | Residents | Non-residents |
| Sale of the main residence of owners over 65 years of age | Yes | No |
| Reinvestment in the primary residence within 2 years | Yes | Under conditions |
| Acquisition before 1995 | Yes | Yes |
| Capital loss | Tax credit | Reimbursement up to 3% |
Practical advice from Terreta Spain experts for international investors
- Negotiate the update coefficient for properties acquired before 2015.
- Keep all invoices (work, notary fees, taxes) for 5 years.
- Choose the optimal calculation method for the municipal capital gains tax (run simulations).
- Consider changing your tax residency 2 years before the sale to benefit from exemptions.
