buying guide

Understanding Spanish Property Taxes: Complete Guide

A comprehensive breakdown of all taxes when buying and owning property in Spain, including ITP, VAT, IBI, and annual costs.

Purchase Taxes When buying property in Spain, you'll encounter two main purchase taxes depending on whether you're buying new build or resale.

For new builds, you pay VAT (IVA) at 10% plus Stamp Duty (AJD) at 1.5%.

For resale properties, you pay Transfer Tax (ITP) at 10% in the Valencia region.

IBI - Annual Property Tax IBI (Impuesto sobre Bienes Inmuebles) is the annual property tax similar to council tax.

It's calculated based on the catastral value of your property and typically ranges from €300 to €1,500 annually depending on the property size and location.

Non-Resident Taxes If you're a non-resident owner, you must pay annual imputed income tax at 24% of 1.1% of the catastral value (approximately 0.264% of catastral value).

If you rent out the property, you pay 24% tax on rental income.

Wealth Tax Properties valued over €700,000 may be subject to Spanish wealth tax, with rates varying by autonomous community.

Valencia region has its own rates that should be considered for luxury properties.

Capital Gains Tax When selling your Spanish property, non-residents pay 19% capital gains tax on the profit.

The buyer is required to withhold 3% of the purchase price as a guarantee for this tax obligation.