Always ask legal advice from a professional who is qualified to act in your interests to ensure that you are protected and well advised. You can choose between a registered real estate agent, a specialized “gestor” ( GIPE) or a lawyer. Never depend on the seller of a property to ensure you have a clean and fair deal.

First of all the property you are interested in has to be checked in the Property Registry (“Nota Informativa”) to find out if there is any outstanding mortgage or other charges and liens. It also helps you assure that the seller has full ownership of the property, which entitles him - or them- to sign for the Public Title Deed (“EscrituraPublica”).

Be aware that in the case that you buy from a non-resident you will need to deposit 3 % of the total purchase price, as guarantee against the sellers Spanish capital gains tax liability . This means that you only pay to the seller 97% of the purchase price. The Notary wants to see a copy of form 211 which is the document which shows the payment of the 3 %.

It is also important to check if the property is located in a “rural” (rustic) area or in housing developments ( “ Urbanizaciones”) as both have different restricted building approvals as well asproperty tax (“ IBI”).

• The seller has to prove ownership by showing the “Escritura Publica”or an updated “Nota Informativa” from the Property Registry.
• A copy of the paid receipt of the annual property tax called “ IBI”
• A certificate from the community administrator certifying that all fees have been paid.
• The paid receipts for electricity, water, gas and garbage.

You will have to identify yourself to the Spanish tax authorities with a NIE number, which means “ Número de Identificación de Extranjero”. You will need this number for nearly all transactions in Spain where payments of taxes are involved…..this is the case for both the resident or non-resident status.

The total amount will be a slightly less than 10% of the purchase price.

If you buy a second hand property you will be charged the following tax and fees:

• Tax: I.T.P (Impuestos de TransmisionesPatrimoniales) , currently 7% of the purchase price.
• Fees: Notary and Property registry fees.

If you buy a newly built property, you will be taxed 8% V.A.T instead of the 7% I.T.P for a second hand property. Notary and registry fees are similar in both cases.

Another tax that has to be paid called“Plus Valia”, which is the municipal capital gains tax on the increase of the value of the land. However, the “Plus Valia” is usually paid for by the seller.

The seller has the following costs to pay:

• The municipal value added tax ( Plus Valia)
• 3% of the total selling price will be withhold by the buyer as guarantee for sellers
• Spanish capital gains liability. The Notary wants to see a copy of form 211 which is the document which shows the payment of the 3%.
• All utility bills paid up until change of ownership.