Spain Explained

Do you pay tax when you sell your house in Spain?

When people are selling their property in Spain, they wonder, “do you pay tax when you sell your house?” Generally, this type of taxation falls under capital gains tax (CGT), which can cause confusion. Capital gains tax applies in most countries when you sell a property. In essence, CGT is a payment on the profit you make. Recently, there have been a number of changes in relation to capital gains tax that have caused some confusion amongst foreigners living in Spain.

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Considering the property slump, many people will not actually have made a profit from the sale of their home in Spain. However, if you are in the fortunate position of making a profit on the sale, then Spanish CGT can be a big issue. In this article, we address the conundrum of “do you pay tax when you sell your house in Spain?” in more detail.

Do you pay tax when you sell your house if you’re a non-resident?

If you are a non-resident you will pay 19% capital gains tax in Spain. This was reduced to a standard levy from 19.5% in 2016. To enforce this rule, the Spanish Tax Authority withholds 3% from the sale of your property. This is taken directly from the purchaser so you only receive 97% of the amount the property was sold for. The 3% is a safeguard so that non-residents do not ‘disappear’ before they have settled their CGT account.

If you don’t owe CGT then the 3% will be refunded. However, if more is required then you will need to provide the extra. In order to collect any refund, you need to complete the form 210H. You should submit this form within three months of the sale, along with the last four years of non-resident income tax returns. From the date that you present the documents, you should allow around a year to receive the refund.

What about when you’re a resident?

If you are a resident you must declare CGT on your annual tax declaration. The Spanish Tax Authority will charge capital gains tax according to your overall annual income. There are possible exemptions from capital gains tax if you are a resident:

  • For instance, if you are over 65 years old and have been living as a tax resident in the same permanent home in Spain for more than three years, then you are exempt from paying Spanish capital gains tax on the property.
  • You can also be exempt from paying CGT if you have been a fiscal resident in Spain for three years and reinvest your money from your principal home in another principal home. However, you must continue to live in this new property for the next three years. The property you buy can be in any member EU state, but you must reinvest all the money. If you do not then you will be liable to capital gains tax in Spain on the difference.

If you haven’t quite made the three-year threshold and there is a compelling reason why you have to sell, the Spanish Tax Authority will take this into account. So, for example, if you have a medical issue that means you can no longer manage to live in a high-rise property, or if you have to move because of work-related reasons, then the Spanish Tax Authority will take this into consideration.

Furthermore, if you are selling a property in another country within the EU and you are a resident in Spain, you must declare the CGT when you make your resident tax declaration in June. This declaration covers your income from the previous year.

How does the tax authority calculate CGT?

Capital gains tax is calculated with the purchase price (as written on the Title Deed) with some extra costs including:

This is then deducted from the final sale figure less costs incurred during the sale, including legal fees:

Final sale figure – true purchase price = net profit

Although you can deduct purchasing and selling expenses, you should note that this does not apply to any other debts or mortgages that you have. Furthermore, until January 2015, the Spanish Tax Authority took inflation into account when calculating capital gains tax. However, this is no longer the case. This means that some people are paying significantly more CGT.

What happens if I’ve made improvements to the property?

Aside from “do you pay tax when you sell your house in Spain?”, a frequent question our clients ask is what happens if you have made substantial improvements to your property and it has increased in value. Firstly, it is important to ensure that you have the correct building licences for any changes that you have made. These will also need to have been recorded at the Land Registry. When you register the changes there will be a revaluation of how much the property is worth that should bring it more in line with your selling price. As with most taxes, being aware of what to expect helps you plan accordingly.

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More questions you might have

Navigating the taxation system of a foreign country can be an intimidating task – especially if you don’t speak the language. Furthermore, as many people who live in Spain know, Spanish bureaucracy can be particularly challenging. However, if you want to sell your home, Ábaco Advisers is here to help. At Ábaco Advisers, our team of experienced fiscal and taxation advisers can help you make sure you follow regulations. For more information, without obligation, don’t hesitate to give us a call. We can give you the advice you need in the language of your choice.

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116 comments

Michael Dawson

1 May, 2018 9:17 am

My wife and I have been tax
My wife and I have been tax resident in Spain for over three years and have sold our UK property in 2017. We are both over 65 years of age. Are we exempt capital gains tax on the sale of our UK property that was our main home for 22 years before moving to Spain?

Suzanne O'Connell

2 May, 2018 12:57 pm

Hi Michael 

Hi Michael 

I'm afraid you won't be exempt as this was not your residential home when you sold it. 

Bernard Wasape

5 May, 2018 9:43 am

Will the CGT be the value of
Will the CGT be the value of my house in England when it ceased to be my domicile 10 years ago as opposed to the MUCH lower purchase price when I bought it.

Suzanne O'Connell

8 May, 2018 12:03 pm

Hi Bernard

Hi Bernard

Capital Gains is based on the purchase value plus official costs less the sale prices less costs and you are taxed on the difference. 

David Larby

6 November, 2018 11:20 am

I am selling my house in the
I am selling my house in the UK for £275000 with a mortgage outstanding of £35000 having bought it in 1996 for £62000, completion will probably be January 2019, we can see that in the UK there is no CGT but as are planning on moving to Spain next year we have been told that we will be liable for CGT there.
We are selling our main residence in the UK and buying our main residence there for around 208000 euros, as we will NOT be resident in Spain when we sell our house, we are moving AFTER it is sold we will not be resident for tax purposes or will we.
Please help

Suzanne O'Connell

13 November, 2018 9:21 am

Hi David

Hi David

Provided the sale of the property in the UK is done in the year before you come to Spain to live, then you will not be liable for CGT here. So, if you sell in 2018 and do not come to Spain as residents until 2019 there will be no CGT. However, if you sell in 2019 and become residents in Spain in the same year, there will be. 

Joanna Thomas

20 November, 2018 10:55 am

Hi. thanks for this info –
Hi. thanks for this info – very helpful
Just to be certain:
– If I sell my house in the UK, the only possible tax liability in Spain is on the capital gain? (it’s not yet certain whe all this will happen so I want to know my maximum liability)
– I can offset verifiable improvement costs against the gain? Is this a case of producing builders’ receipts?
– Am I right in thinking there is also a threshold of about 11,000 that can be set against it?
– I see the rate for non-residents is 19%. What would it be if I were resident and not in anyway exempt from CGT?

Many thanks

Suzanne O'Connell

2 December, 2018 7:40 pm

Dear Joanna

Dear Joanna

This is quite a complex case and each case such as this must be studied to see if modifications and builders' receipts are acceptable or not. If you are a non-resident of Spain then you do not pay capital gain tax here for the sale of a property in the UK. 

Martin Osmond

30 December, 2018 9:46 am

In the uk cgt is only payable
In the uk cgt is only payable on gains over £11.700, is there a figure that is non taxable in Spain please ?

Suzanne O'Connell

1 January, 2019 4:47 pm

Dear Martin

Dear Martin

There is no allowance for capital gains tax. 

Annmarie Newton

30 December, 2018 9:43 pm

Hi,
Hi,
Bought our UK house 35 years ago for £21,000. Would probably sell now for £180,000.
We rented out the house 3 years ago, moved to Spain and are now Spanish tax residents. How much CG tax would Spain want if we sold now?
Thanks

Suzanne O'Connell

5 January, 2019 10:59 am

Hi Annmarie

Hi Annmarie

You pay tax on the capital gains made from the difference between the sale price and the purchase price. This is classed as income that is declared on your annual tax declaration. The percentage depends on your tax declaration and the rest of your income.  

Dave murphy

17 January, 2019 10:29 pm

When calculating cgt on the
When calculating cgt on the sale of your property in Tenerife, can you consider the agents purchase and selling fees ?
Also having replaced all doors and windows, new kitchen, bathroom, and tiles throughout, can you consider these costs when calculating cgt taxes ?

Suzanne O'Connell

28 January, 2019 2:05 pm

Hi Dave

Hi Dave

The costs for the solicitors, agents' fees etc. can always be deducted provided there are official receipts. You would have to get local advice on other costs and would need official receipts for these too. You can deduct usually for some improvements but not for wear and tear costs. 

Harriet Smith

20 January, 2019 4:55 pm

Hello,
Hello,
My aunt has a second home in spain and lives there a few months of the year but is a tax payer in the uk where she is a resident. She is selling her spanish property and thought she would pay CGT in the uk on the profit but now isnt sure if its actually due in spain? Any advice?

Suzanne O'Connell

28 January, 2019 2:07 pm

Hi Harriet

Hi Harriet

As the property is situated here you have to pay CGT in Spain and then make a tax declaration in the UK. Under the double taxation treaty the tax paid here can be deducted from any liability in the UK. 

steve cooper

5 February, 2019 4:22 pm

If I am resident in Spain,
If I am resident in Spain, and sell a house I have owned in the UK for many years (inc. when it was my personal residence whilst in the UK), I understand that I have to pay some Spanish CGT (even though there is no CGT liability in the UK). But, is the Spanish CGT calculated on the increase on the property from when I became resident in Spain? (i.e. I presume I need a valuation on the date I became resident, rather than basing the gain on the original cost price when I was a UK resident).

Suzanne O'Connell

13 February, 2019 10:50 am

Hi Steve

Hi Steve

The tax is based on the purchase price plus costs then the sale price less costs and you pay tax on the difference. 

steve cooper

26 February, 2019 12:32 pm

Hi Suzanne. Thanks for your
Hi Suzanne. Thanks for your reply. The key part of my query related to the date I became a Spanish Resident. Surely the Spanish gain is solely the element from the value of my property at the point I became a Spanish resident, rather than the original cost where I was a UK resident? In which case, I would need to get a property valuation at the date I left the UK ??

Suzanne O'Connell

4 March, 2019 12:44 pm

Hi Steve

Hi Steve

Unfortunately, the capital gains is calculated from the date of purchase of the property to the sale. When you became a resident makes no difference. 

Jacqueline Ramscar

6 February, 2019 4:08 pm

If a Spanish resident and tax
If a Spanish resident and tax resident for more than 3 years and over 65 and you sell your house to return to uk do you have to purchase another property can you just return to uk with the money from your sale

Suzanne O'Connell

13 February, 2019 10:53 am

Hi Jacqueline

Hi Jacqueline

If you are a tax resident for more than three years and over 65 and you sell your house when you are still a resident then there is no capital gains tax to pay. However, you must still complete the tax declaration for that year as a resident. 

Mr vincent rochester

7 February, 2019 3:00 pm

Hi, I am completing on a
Hi, I am completing on a villa in Alicante at the end of June, I am selling my UK house but might not complete untill August, would it be best to wait untill January 2020 to become resident in Spain and just be non resident for the rest of this year and just stay for the 90 days to advoid Capital Gains Tax. Thank you

Suzanne O'Connell

12 February, 2019 8:11 am

Hi 

Hi 

Yes, become a resident in 2020. 

Adrian Barry

15 February, 2019 4:10 pm

Hi, We are currently planning
Hi, We are currently planning on selling our family home this year in Ireland and moving to Spain. I saw in one of your earlier comments if we move in the same year that we sell our home we are liable for CGT. However in Ireland If you spend 280 days or more in Ireland over a period of two consecutive tax years, you will be regarded as resident for the second tax year ( which applies to us ). Does this supersede Spanish tax law to leave us with no liability as we will not be deemed tax resident? We are planning on moving in May to enrol our kids in school but if we need to ensure that we are not in the country for more than 183 days than we will have to move in mid July. I appreciate your help on this.
Many Thanks.

Suzanne O'Connell

22 February, 2019 2:18 pm

Dear Adrian

Dear Adrian

If you sell and move to Spain in the same tax year and are here for 183 days then you have to pay capital gains tax here. It's better to sell in Ireland and not come to Spain until the following year. 

Viv

18 February, 2019 10:12 am

I don’t understand this very
I don’t understand this very well.
If I am a UK resident and selling my Spanish property for €125,000
Will I pay 19% tax or 3% tax?
How much will I have to pay?
I have not been a Spanish resident.

Suzanne O'Connell

18 February, 2019 2:11 pm

Hi Viv

Hi Viv

3% is retained by the purchaser and paid to the Tax Office as a deposit for the Capital Gains Tax which for non-residents is 19% of the profit made. 

Gans

18 March, 2019 1:46 pm

I am a resident in Spain for
I am a resident in Spain for more than a year, and I am selling a small property (Urban Land, no building on it; price is less than 50K Euros)) that I have had for more than 20 years in my country of birth, outside the EU, i.e. overseas; and I am paying taxes there (in my country of birth) for selling it. Do I have to pay a tax here in Spain?
Thanks for your help.

Suzanne O'Connell

22 March, 2019 8:47 pm

Hi Gans

Hi Gans

Yes, you will have to pay capital gains tax here

John Andrews

25 March, 2019 1:55 pm

If I am resident in Spain and
If I am resident in Spain and sell a property back in UK that has no capital gain is there any tax to pay at all?

Suzanne O'Connell

31 March, 2019 3:57 pm

The property has to be

The property has to be declared and if there is no capital gain then there is no tax to pay. 

David Franklin

28 April, 2019 10:39 am

I sold my house in the uk
I sold my house in the uk before moving to spain intending to become resident but because of not being able to settle only stayed in our spanish villa for less than 6 months at a time over a 2 year period using it as a holiday home. When returning to the uk residing with my daughter. We have now sold in spain intending to re-invest the proceeds for our main residence in the uk. Are we liable for CGT.

Suzanne O'Connell

30 April, 2019 11:58 am

Hi David

Hi David

As non-residents in Spain you will have to pay CGT here but you will also, as UK tax residents, have to declare the sale in the UK under the double taxation treaty and any tax paid here is deducted there 

Chris

4 May, 2019 2:47 pm

Resident in Spain, with
Resident in Spain, with property here.

Property in UK that one day I may wish to sell.

Am I right in thinking the way to reduce the CGT would be to return, live in the property one year and then sell it there as first resident. Is that right?

Suzanne O'Connell

10 May, 2019 12:33 pm

Hi Chris

Hi Chris

No. For it to be your residential home you would have had to have lived in it for three years prior to the sale. You would not be residents in Spain as the property is in the UK. 

carl

8 May, 2019 1:04 pm

Hello . I’ve received a
Hello . I’ve received a received a letter from HMRC Debt Collection agency relating to unpaid CGT for a house I sold in Spain in 2011. I am shocked by this because I have never received any form of notice from the Spanish authorities. I was 67 when I sold the Spanish house and then bought my home in the UK several months later.
Is there not a time limit to claim for CGT claims ? Any other information, I’ll be glad to provide.Thanks in adavance. Carl

Suzanne O'Connell

20 May, 2019 8:12 pm

Hi Carl

Hi Carl

As a file has been opened the time line of four years is extended. If sold, this is a complex situation but you should have either presented the Resident Tax Declaration of 2011 to pay tax or claim exemption or, if non-resident, presented the 210H. 

Lynn Elkington

20 May, 2019 10:43 am

I purchased property in Spain
I purchased property in Spain for 186,000 in 2009/10 I sold it in January 2018 for 115,000 and still have not received at tax refund. Any idea how much this will be and when may I be likely to receive it.

Suzanne O'Connell

24 May, 2019 1:32 pm

Hi Lynn

Hi Lynn

You have to make the application for the refund of the 3% held so the refund would be €3,450 and can take anything from up to 12 months from the date of the presentation of the 210H form for the refund to be made. 

Úrsula

27 May, 2019 2:38 pm

I bought my flat in Madrid in
I bought my flat in Madrid in July 2015 when I was resident there. I sold it in January this year and was told I had two years to pay the CGT on the property. As I am no longer resident there (I have since returned to the UK) I don’t have to do my declaración de la renta as usual but I’d like to know if I do have two years to pay it but also, if I buy a property in the UK, while we’re still a member of the EU, do I still have to pay it? And if so, who do I pay it to?

Suzanne O'Connell

1 June, 2019 4:13 pm

Hi Ursula

Hi Ursula

As a non-resident the capital gains tax declaration form 210H should be presented three months after the presentation of the 3% retention and the capital gains paid. If not, then there is a fine. 

Hilly P

2 June, 2019 3:45 pm

I am resident in spain and
I am resident in spain and have a property in the Uk that I bought 25 years ago so the gain on it is huge (about 400k). My principal home is now in spain. i want to raise 100k for deposits on property for my 2 children and one option is selling the UK property. I know that if I sell the UK property now I would have to pay CGT in the UK but as I am resident in spain, according to the new tax laws, I believe the UK CGT would be based on the value of the property in April 2015 which would mean CGT on about 60k. But with the dual tax laws am I right in thinking that the CGT due in Spain would be on the purchase price minus the sales price which would wipe out any benefit of the new CGT rules in the UK ie I’d still have to pay CGT on a profit of 400k or so but to spain instead?

Suzanne O'Connell

11 June, 2019 8:37 pm

Hi

Hi

You have to declare in the UK under British Law and in Spain under Spanish regulations. This will be the value of purchase plus costs, value of sale less costs and then an allowance for the time if purchased before 1994. Then you deduct any tax paid in the UK under the double taxation treaty. 

Hilly P

9 June, 2019 10:08 am

We have property in the UK
We have property in the UK and are resident in spain. If we move back to the UK, for how long after our return to the UK are sales of UK property affected by spanish capital gains please? Ie, at which point can we sell a property and not be liable to declare the sale in spain /pay CGT in the UK only/not have to consider dual tax implications?

Suzanne O'Connell

14 June, 2019 8:47 pm

Hi Hilly

Hi Hilly

It would have to be at least one full tax year. 

Susan Bramley

20 June, 2019 6:53 am

We have lived in Spain for 12
We have lived in Spain for 12 months and now considering selling our UK property which we rent out. We only purchased the property in 2012 and not sure if CGT is payable because we have only owned the property since that date.

Suzanne O'Connell

24 June, 2019 6:11 am

Hi Susan

Hi Susan

I'm afraid capital gains tax is still payable.

Susan Bramley

21 June, 2019 9:32 am

If our property in England
If our property in England was purchased in 2012 and we decide to sell it are we liable for CGT in Spain as someone has told us we haven’t owned it long enough to pay CGT on it?

Suzanne O'Connell

24 June, 2019 6:15 am

Hi Susan

Hi Susan

As mentioned above, you are still required to pay CGT

David Pryor

15 July, 2019 12:31 pm

Hi, my wife and I sold our
Hi, my wife and I sold our apartment in Spain in March 2018. We are non residents. We have not yet received the 3% retention back 16 months later. Our solicitor has chased the tax office but to no avail. Is the tax office in Spain accountable to anyone? Is there a phone number or email address available for non Spanish speakers to raise queries? Any advice would be gratefully received.
Thank you

Suzanne O'Connell

18 July, 2019 8:55 pm

Hi David

Hi David

It can take a long time for the Tax Office to process this. There is no number for non-Spanish speakers. The telephone number for non-residents in Madrid is 91 7575775 but for earlier presentations you will have to go in person to the corresponding office in the capital of the province and arrange an appointment as no information is given by phone. 

Jay

15 July, 2019 3:48 pm

We are UK residents who have
We are UK residents who have just sold our primary and only UK property. We already own a small house in Spain which we plan to keep. We now want to buy a 2nd property in Spain.
Our aim is to move to spain and use the new property as our primary residence and become residents. Have I got it right that it would be best for us to wait until 2020 before becoming residents in Spain? Thanks for any advice

Suzanne O'Connell

24 July, 2019 6:07 am

Hi Jay

Hi Jay

If you sold in 2019 in the UK you would need to wait and come to Spain in 2020 or you might have to pay CGT. 

Gillian Breakwell

22 July, 2019 2:06 pm

Who tells us how much capital
Who tells us how much capital gains tax we need to pay when we sell our garage space in Spain and how is it collected. We are non residents

Suzanne O'Connell

25 July, 2019 2:55 pm

Capital Gains Tax is due on

Capital Gains Tax is due on the profit made on all property sales in Spain. In the case of all Non-Residents, 3% of the current sales price is retained by the lawyer acting on behalf of the buyer and paid to the Hacienda Pública (Tax Office) in the name of the seller on Tax Form 211. This is a legal requirement when non-residents sell property. The non-resident seller therefore receives 97% of the agreed price until any tax liabilities (including Capital Gains Tax) are settled, after which the seller will either get a refund or have to pay any outstanding tax balance.

For non-residents, the capital gains tax rate is 19%  of the profit made on the sale.

To calculate this profit you need firstly to ascertain your original purchase price.  We do this by adding to the purchase price as written on your Title Deed the costs which you incurred in the purchase (VAT, Land Registry fees, Notary fees, Transmission Tax, Legal fees etc). This gives  a true purchase cost.

We then take your current selling price and deduct from it the costs incurred in the sale (legal fees etc), thereby reducing the final sale price. 

 Now you have your original purchase price and your final sale figure, so we can work out your net profit and calculate your Capital Gains Tax liability.

 The 3% retained by the Tax Office will either be more than or less than the sum of tax to be paid. In either case, Form 210 H is submitted to the Tax Office, either claiming the outstanding balance or enclosing payment for the sum owed.

DM1969

28 July, 2019 2:18 pm

Hi there
Hi there

3. CGT questions for you:

1. I own a UK property that has doubled in value since I bought it back in 2006. Am I correct in thinking that the calculation for Spanish CGT = sale price – (original price+improvements+outstanding mortgage)? The outstanding mortgage is important to know that this is factored in as I have quite a bit left to pay off that will be paid off with the sale albeit that there will still be CGT to pay due to increase.

2. I am currently renting here in Spain and looking to buy a house here. Am I right in thinking that I can invest the proceeds of the uk house in the Spanish house and thus avoid/minimise CGT? Can the UK continue to be called my prime residence even though I’m renting temporarily here in Spain while looking to buy a house?

3. Further to point 2, can I buy here in Spain first and then sell later the UK property and still benefit from this relief? I’d need to take out a temporary mortgage here in Spain to part fund the purchase and then use the proceeds from the UK sake to pay it off. I have read there is a period of 2 years before/after sale?.

Many thanks – congrats on website and forum – very useful and insightful

Suzanne O'Connell

3 August, 2019 10:02 pm

Hi

Hi

To answer your questions:

1. No, the paying off of the mortgage will not influence the CGT

2. This is a complex issue. In theory you would have to present the tax declaration first to pay the CGT then present a request to take into account that the property sold was Residence Habitual. However, you would normally have to be a tax resident for 3 years before any benefits can be obtained. 

3. as in point two, if you sell later and live in the new property , the property there is not your habitual home 

David Barton

31 July, 2019 5:55 am

Hi
Hi
We are saleing our Spainish property that we have own for approximately 1year . As we understand it there will be cgt on any profit at the rate of 19 per cent. Is the the only only tax payable ?.

Suzanne O'Connell

3 August, 2019 10:04 pm

Hi David

Hi David

No. There will also be Plus Valia to pay. 

Ian walker

2 August, 2019 5:41 pm

We are in the process of
We are in the process of selling our only house (which is in the uk). Value circa £400,000. We paid £175,000 but did spend a lot on refurbishment many years ago. When it sells I plan on taking early retirement and immediately moving to Spain. I am 51 and my wife is 68. The cgt that seems liable will completely change these plans. Are there no easy solutions?

Suzanne O'Connell

7 August, 2019 3:41 pm

Hi Ian

Hi Ian

The only way to avoid capital gains tax is to sell the property in one year and not come to Spain until the following year. 

Colin

5 August, 2019 5:49 pm

Hi,
Hi,
We bought an apartment in Spain for 225,000€ back in 2004/5. If I decided to sell it know it would only fetch around 150,000€, and I still owe around 60,000€ on a Spanish mortgage.
Since we purchased, exchange rates plummeted as well as the property market.
Would I be liable for any tax?

Suzanne O'Connell

8 August, 2019 7:12 pm

Hi Colin

Hi Colin

Capital Gains Tax is due on the profit made on all property sales in Spain. In the case of all Non-Residents, 3% of the current sales price is retained by the lawyer acting on behalf of the buyer and paid to the Hacienda Pública (Tax Office) in the name of the seller on Tax Form 211. 

This is a legal requirement when Non-Residents sell property. The Non-Resident seller therefore receives 97% of the agreed price until any tax liabilities (including Capital Gains Tax) are settled, after which the seller will either get a refund or have to pay any outstanding tax balance.

For Non-Residents, the Capital Gains Tax rate is 19% of the profit made on the sale. To calculate this profit we need firstly to ascertain your original purchase price. We do this by 

adding to the purchase price as written on your Title Deed the costs which you incurred in the purchase (VAT, Land Registry fees, Notary fees, Transmission Tax, Legal fees etc). This gives us a true purchase cost. 

We then take your current selling price and deduct from it the costs incurred in the sale (legal fees etc), thereby reducing the final sale price. We can also deduct certain costs of major structural alterations you have made to the property – but only if you can produce the official receipts for the materials and/or work involved (not applicable if you paid by cash and have no VAT receipt).

Now we have your original purchase price and your final sale figure, so we can work out your net profit and calculate your Capital Gains Tax liability. 

The 3% retained by the Tax Office will either be more than or less than the sum of tax to be paid. In either case, Form 210 H is submitted to the Tax Office, either claiming the outstanding balance or enclosing payment for the sum owed.

David

11 August, 2019 9:55 am

I was resident in Spain. I
I was resident in Spain. I sold my house in Spain in November 2018, I moved back to the UK. What is the time scale to reinvest the gain in a new property to avoid CGT?

Do I have to complete within that time, or can I place a deposit on a new property?

Oscar Paoli

11 November, 2019 4:02 pm

Hi David,
The time scale for reinvestment is normally 2 years, this would have been declared in the 2018 Tax delcaration where you would have promised the amount to be reinvested.
Best regards,
Ábaco Advisers

Mrs Glenda Pennell

3 October, 2019 9:08 pm

I am a non resident with a property in Spain I have just sold my house in the UK and would like to move to Spain next month will i have to pay capital gains to spain even if i wasn’t a resident when i sold it

Oscar Paoli

7 October, 2019 11:25 am

No, in this case you will not need to do so.
Kind regards,
Ábaco Advisers

Neary Rama

10 October, 2019 9:36 am

I have a question regarding Property Capital Gains Tax: Can a Non-Resident profit from a roll-over relief if the sale proceeds are re-invested in another property in another part of Spain?

Oscar Paoli

10 October, 2019 11:11 am

Hello,
No, unfortunately this is only for residents in Spain that sell their main property and where they have lived permanently at least 3 years.
Kind regards,
Ábaco Advisers

Tim Solway

14 October, 2019 12:06 pm

Earlier this year I purchased a one bedroom flat.

Following our purchase I have conducted an official MINOR REFORM with permission given by the council and the appropriate tax paid.

At this point I am undecided whether to sell or to rent. I would like to understand the tax position in the event that I decide to sell the property.

Am I correct in assuming the following when I am calculating my Spanish tax and capital gains tax (CGT) obligations:

1. The total cost of purchase can include transmission tax, lawyer, notary and registration fees. Is this correct?
2. An official licence was obtained for a minor reform and taxes paid. No structural work was conducted in the reform process. I understand that there are no allowances that relate to any of the money spent on the reforms when calculating my CGT obligations. The reforms included new kitchen and appliances. Is this correct?
3. Are there any other deductions allowable such as community fees, electricity, local council taxes, when calculating CGT?
4. I understand that there is a 3% withholding tax which can be recovered after a certain period. Is this correct?
5. I understand that the correct rate of CGT in Spain is 19%. Is this correct?
6. Will there be another tax applied to the sale called Plus Valia and is this a tax that I will pay? If so how is it calculated?
7. I understand that all selling fees and lawyers fees can be included in the final CGT tax computation.
8. Are there any other taxes and or items that I have omitted?

Lots of questions. Your advice would be appreciated.

Oscar Paoli

17 October, 2019 2:35 pm

Hello Tim,
Will try to answer the best as possible below to your queries:
1. Yes, this is correct.
2. The answer is correct there are no allowance for minor works carried out on the property, had it been an New Building and extension of the property with a new Title Deed then this would have been allowed.
3. No, unfortunately no.
4. Yes, you may recover it if you do not have a CGT or if the CGT is below the 3% retained and then you could recover the difference.
5. 19% is correct as non-resident.
6. Yes, plusvalía is a tax paid when selling and is calculated on the rateable value of property and the number of years that have passed since the property last changed hands.
7. Selling feed such as the estate agents commission can be deducted.
8. We believe you included everything in your list.

With kind regards,
Ábaco Advisers

Ken Cook

22 October, 2019 3:04 am

F.A.O. Suzanne O’Connell

A few queries from an old sea salt. Will gladly reimburse if required for your time and expertise !

I have been Non-Resident in Spain since mid 2000. Presently I work offshore in the UK Oil & Gas Sector so am officially a UK Resident for Taxation purposes. I return to Spain during my field-breaks. Therefore, I am in the UK for approx 210 days out of 365 days. Am I still legally a Non-Resident with around 150 days per year living in
Spain ? ( I have no UK assets / property )

Since August 2006, I have lived in Granada and intend to retire there in 2023 when I reach 66 years. When I retire, I believe it will be mandatory to take full residency as my presence in Spain will become permanent. Please can you confirm ?

My property in Granada was purchased for circa 265,000.00 Euros in mid 2006. There is no outstanding mortgage
Should I sell my house after 4 to 6 years after retiring and have taken full residency status, I believe I might be exempt from Capital Gains. Please can you clarify if my reasoning is correct or otherwise ?

If any profit from the sale of the Granada property was transferred back to the UK, would I be subject to any UK foreign earnings taxes ( the money would probably be invested into a retirement apartment ) ?

Regards

Ken Cook

Oscar Paoli

23 October, 2019 4:55 pm

Hello Ken,

As answer to your query you are still non-resident in Spain.

We do not know if there will be change of laws when you intend to retire in 2023, but according to todays situation you will have to become resident in Spain if you intend to live permanently in Spain.

According to todays tax situation if you are over the age of 65 years old, you are pensioner, have been resident in Spain for over three years and the property you are selling has been your main residence you willl be exempt of Capital Gains Tax.

If you are resident in Spain you should not be required to pay taxes back in the UK.

Kind regards,

Ábaco Advisers

JENNIFER PRICE

22 October, 2019 11:20 pm

Dear Sirs As non residents we built a house in spain on ground we already owned. property built 2005/6 approx build cost 230,000E , property registered with notary early 2015 following some repair works, with a value of 270,000E all relevant papers regarding build provided to the notary at that time.
Property sold end 2016 for 280,000Euros. 3% retention for CGT paid to Agencia Tributaria at time of sale.
All paperwork of no value to the purchaser, destroyed in Jan 2018. 2018 Agencia calculated a CGT bill based on original purchase price of the land (some 30,000Euros in 2001) . Our Gestoria argued that the property was sold with a house, and despite us no longer having the builders receipts the value of the build was approx 230E plus costs.
Agencia Tributaria has reassessed the CGT now due at about 41,000euros and we are in the process of appealing. We have had to pay 5,162thousand euros in April 2019 in order to defer payment and appeal and further payments of some 2,788thousand euros per month for the next 12 months.
The Agencia has made no ruling as yet, I gather it has 6mths to respond. This means shortly if we receive no ruling, we will have to appeal to a Tribunal to overrule the Agencia and have our payments returned. I am very unwilling to continue to make payments as the amount demanded is patently incorrect.
If the Tribunal does not overrule the Agencia, we will not receive any repayments either.
Please can you advise if this is legal that the agencia can invent this CGT due when we provided all the paperwork to the Notary at the time of registration of the property.
This seems to be a false calculation we are being asked to pay..

Oscar Paoli

24 October, 2019 7:57 am

Dear Jennifer,
It is complicated to give you detailed information without seeing the documentation of the property. In these cases it is vital that you have all documentation and paperwork in place and in order, without it is very difficult to claim anything at all from the Agencia Tributaria. Also the registration of the building should have been done before 2015 to avoid any possible issues.
We assume you legal team is doing all that is possible with the tools and paperwork they have on the property.
Sorry we can not really be of any further assistance.
Kind regards,
Ábaco Advisers

Anonymous

25 October, 2019 10:34 am

Hi, my partner & I split about 4yrs ago, we live & had a mortgage in tenerife, I sold the property & the lawyer kept back the percentage for taxes @ Notre & all outstanding Bill’s were paid before completion, I moved back to uk & my ex has stayed & worked in tenerife, she call me & said she received a letter today demanding €11,000 for tax on property! But this was all taken care of when property was sold, what she do?

Oscar Paoli

25 October, 2019 10:59 am

Hello,
Thanks for your message. We would need to see all paperwork, taxes paid, and letter of the Tax Authority to be able to asses in this matter.
If you wish to send us all documentation on your case you can do so by emailing us at info@abacoadvisers.com
Looking forward to hearing from you.
Kind regards,
Ábaco Advisers

Ian Radford

6 November, 2019 3:16 pm

Dear Miriam .
We purchased a new build apartment in Mallorca for 404600 euros plus the 10 % tax for new builds this was in 2017 so the total paid with tax 445,060 euros
We have just accepted a offer for 510,000 euros
Can I ask is the capital gains tax paid on the difference between 404k euro figure or the 445 k figure .
No one seems to be able to confirm . Is the gain on the 105,400 euros or 64940 euros ?
Many thanks in advance
IAN

Oscar Paoli

7 November, 2019 9:42 am

Dear Ian,

For non-residents, the capital gains tax rate is 19% of the profit made on the sale.

To calculate this profit we must work out the true purchase price:

• Purchase price (as written on the Title Deed) + costs incurred in the purchase

The purchase costs that will be taken into account include the VAT, Land Registry fees, Notary fees,
Transmission Tax and Legal fees.

We then take your current selling price and deduct from it the costs incurred in the sale (legal fees etc).
We can also deduct certain costs of major structural alterations you have made to the property – but only
if you can produce the official receipts for the materials and/or work involved. We can not do this if you
paid by cash and have no VAT receipt.

These calculations will leave us with a final sale figure.

• Final sale figure – true purchase price = net profit

Hope this information can be of help.

Kind regards,

Ábaco Advisers

Karacsonyi Robert

14 November, 2019 7:36 pm

Hi,

We sold our apartment in Spain as non residents and we can’t do our Capital Gains Tax because our accountant says that we need the 211 form with the 3% retention from the buyer in order to do this but we can’t reach him. What is the solution in this case, if the seller can’t get the tax declaration from the buyer with the 3 % retention.

Thank you!

Oscar Paoli

15 November, 2019 4:15 pm

Hi,
Our recommendation is to have your solicitor claim the 211 to the buyer and their representative.
Kind regards,
Ábaco Advisers

Anne Marie Frisby

17 December, 2019 5:32 pm

My Name is Anne Marie Frisby I have an account with you
I am thinking of selling my property as I am now a Senior Citizen do I still pay Property tax
Regards
Anne Marie Frisby

Oscar Paoli

17 December, 2019 5:54 pm

Hi Anne,
Yes unfortunately yes, you will have to pay property tax.
Should you need assistance please contact our colleague Jessica at the following email jsp@abacoadvisers.com
With kind regards,
Ábaco Advisers

Carmen

31 December, 2019 5:19 pm

My husband and I bought an apartment in Spain in 2006 for 210,000 euros. We want to sell it but it but we will sell it at lost. According to the market value it is worth 185,000 euros. We are non-residents. We have finished paying for the mortgage. We are over 65 years old. Do we have to pay CGT and Plusvalia in Spain? How much? Do we have to pay Income tax in the UK? Even though we will not make any profits.

Oscar Paoli

2 January, 2020 12:51 pm

Hi,

If you can prove these figures you will not need to pay CGT, but please bear in mind that when selling your property as non-resident 3 % of the sale price will be retained by the buyer and paid to the hacienda pública (tax office) in the name of the seller on tax form 211. This is a legal requirement when non-residents sell property.

Regarding the plusvalía you will most certainly be responsible to pay this tax to the Local Town Hall.

Should you need any help in the process please contact us at info@abacoadvisers.com

With kind regards,

Ábaco Advisers

Howard

10 January, 2020 12:16 am

We are building a villa at a cost of €650000 in the province of Alicante.

It is our intention to reside there for more than 26 weeks of the year

I have 13 properties in the uk (all in my sole name) that I rent out.

If we become resident in Spain what taxes will I pay and how much

Thank you

H

Oscar Paoli

13 January, 2020 2:07 pm

Hi Howard,

Without all the figures it is very complicated to goive a good answer to this query, you would have to be in Spain for less than 26 weeks as this is exactly 50% of the year which could bring you over the 183 days allowed. If you are residents you would pay Tax on your world wide income including the proeprties, there could also be Wealth Tax on top of income Tax. The rent for the properties has to be declared in the UK as well as in Spain, Tax paid on the rental income is deducted from the Tax to pay here under the double Taxation treaty.

Should you have any further queries please do not hesitate to contact us at info@abacoadvisers.com

With kind regards,

Ábaco Advisers

Julie Hill

10 January, 2020 4:23 pm

Hi. I am a non resident but have owned a small town house in a village since 2004. Although i payed €47.000 if i could if a buyer it is now proberly only worth around €5.000. Would i have to pay any tax as it will be sold for a loss?
Thanks

Oscar Paoli

13 January, 2020 2:03 pm

Hi Julie,
If sold for a loss for a Non Resident then there is the 3% retention which can be claimed back if there is no CGT to pay.
With best regards,
Ábaco Advisers

Michael Coles

10 January, 2020 4:40 pm

We currently have an offer on our home in Spain. I am 69 years old and my wife is 58. We have been residents in Spain for the past 8 years and permanent residents for the past 1 year. Will my wife be liable for CGT on her half of any profit made? This is our only residence, we do not own any other property.

Oscar Paoli

13 January, 2020 2:02 pm

Hi Michael,
Your wife would have to pay Capital gains Tax if there was a Gain as she is not 65.
Thank you so much.
Kind regards,
Ábaco Advisers

Janice

10 January, 2020 6:31 pm

Hi, if we sell our spanish home privately without an estate agent, who pays the solicitors fees, the seller or the buyer

Oscar Paoli

13 January, 2020 1:31 pm

Hi Janice,
The buyer will pay for his solicitor and the seller for his own solicitor, if you have the same solicitor in the process if depends on the agreement you reach.
With kind regards,
Ábaco Advisers

Kirsten Jackson

12 January, 2020 6:31 pm

Dear Sirs,

I would appreciate your advice on the following query.

If a property is jointly owned by a resident and a non-resident, what effect will this have on the 3% capital gains tax retention. If you have any authority for your answer, that would be greatly appreciated.

Kind regards,

Oscar Paoli

13 January, 2020 1:30 pm

Hi Kirsten,
Thank you for contactin us.
In this case only 3% will be retained of the percentage of ownership of the non-resident owner. For example, is you sell a property for 100.000 € and you are both 50 % owners, only 3% of the 50.000 € will be retained for the non-resident owner, in this case the amount of 1.500 € will be retained.
With kind regards,
Ábaco Advisers

Andy

24 January, 2020 8:36 am

Hi, I have Spanish recidencia and have had for 15 years, but am British. Am I correct that if you sell your property in Spain but then fully reinvest any profit in further more properties in Spain you do not pay the capital gains tax, because you will be paying the tax on the new property or properties? For example if a house is sold with a profit of 250,000€ after the mortgage and costs are paid and I then use that to buy 2 smaller properties at 125,000 each. Because I am paying the tax on 2 new property purchases, would I still have to pay the Capital gains on the profit from the original sale?

I was told if profit is reinvested in to the Spanish property market within a 2 year period you do not pay the tax on profit?

Thanks in advance!

Oscar Paoli

29 January, 2020 2:50 pm

Hi Andy,
It is correct that if you sell and reinvest any profit you will avoid the capital gains tax, but if you buy two properties you will have to pay capital gains tax as you can not have two different main residences.
With kind regards,
Ábaco Advisers

Richard Glynn

26 January, 2020 6:13 pm

Hi, we have been living in France for fifteen years, and the plan is to sell our home and enable early retirement by living in rented accomodation in Spain. Trouble is, we have heard that we may be subject to capital gains tax by the Spanish authorities, even though it is our principle home ?

Oscar Paoli

29 January, 2020 3:04 pm

Hi Richard,
Yes this would be the case, it is always advisable to sell the the year prior to coming to Spain to be a Resident.
Kind regards,
Ábaco Advisers

Geoff Cherry

31 January, 2020 12:41 am

Please advise, My Father in law is 95, and has been a Spanish resident for 29 years and is bequeathing his property, 50/50 the family home, a Villa in the Valencia region, valued at approx 270,000E to my wife living here in Spain and her brother a resident in the uk on his death. Will my wife and her brother be liable for any Taxes or Capital Gains Tax on the property before they become the legal owners of it ?If so what amounts are they
When they become the legal owners of it , they both aim to sell it asap and she and I will return to the UK, what tax liabilities will there be when the Villa is sold
Thank your help
Geoff Cherry

Oscar Paoli

4 March, 2020 5:14 pm

Hi,
First they will inherit, they will become owners and will pay Inheritance Tax. The reduction in the Valencia Region is 100.000 € per child, the Inheritance Tax is calculated then on the rest of the value.
In the case that they inherit and sell the property they will have to pay taxes on the sale, admin fees, plusvalía tax, etc.
Please do not hesitate to contact us should you have any further queries.
Kind regards,
Ábaco Advisers

David Patchett

31 January, 2020 12:43 pm

Have the Spanish government legislated on the Plusvalia tax yet

Oscar Paoli

5 February, 2020 2:04 pm

Hi David,
Still no clear ruling on the Plusvalía tax.
With kind regards,
Ábaco Advisers

jose Arnott

9 February, 2020 12:17 pm

I bought land in Spain in 2002 with my Husband who died 6 years ago. We were both OAP s when we moved here and my husband was disabled.. We were both Spanish residents but have not paid tax or been asked to do as we only had some money from our British sale .We have always paid British Tax . Cash price for the land was 40,000 euros. As I am now disabled and not able to keep the property would like to return to Britain before Britain is totally out of the EU. We built up a small casita, pool and a summer house and kept bills to prove this. We spent ( with the land `175,000 euros. ) As I am 80 years old this year. I MUST RETURN TO BRITAIN I have asked how much I could expect to obtain and the reply was 170,00 euros. which is less than we have paid out. Thank you for your help.

Oscar Paoli

10 February, 2020 4:56 pm

Hello,
We are sorry to hear about your situation.
Should you request any assistance from us please call us at 0034 966 703 748 or email us at info@abacoadvisers.com
Kind regards,
Ábaco Advisers

Chris Roberts

11 February, 2020 9:23 pm

Hi I have been sent this regarding being able to reduce the selling price of your property by taking away the balance of the mortgage when you sell.

The question of the mortgage may be covered by this on the AEAT web site:

‘Cuando para adquirir la vivienda habitual transmitida el contribuyente hubiera utilizado financiación ajena, se considerará como importe total obtenido en la transmisión, el valor de transmisión, en los términos previstos en la Ley del Impuesto, menos el principal del préstamo pendiente de amortizar.’

Which more or less states ‘When third party finance was used to purchase the property the sale value will be calculated minus the amount of the outstanding balance of the mortgage.’ It certainly does not say that you have to reinvest the whole amount in order to qualify for the relief.

So it’s saying mortgage can be taken off the selling price to reduce the CGT

Oscar Paoli

4 March, 2020 5:23 pm

Hi,
In order to be able to obtain relief when selling you residential home to purchase another you must have owned the property and living in the house for over three years as a Tax Resident and be reinvesting the full amount in the new property. If you do not reinvest the full amount then you can only dedduct a percentage.
With kind regards,
Ábaco Advisers

Angela Johnson

18 February, 2020 5:46 pm

If I pay my taxes in UK at Source am I liable to pay CBT when sailing my house in Spain

Oscar Paoli

18 February, 2020 6:09 pm

Hi Angela,
Even if you sell your property as non-resident in Spain you will be liable to pay CGT in Spain if the property is located in Spain.
Kind regards,
Ábaco Advisers

Alejandro Moreno

4 March, 2020 1:39 pm

Hi,

I have received a gift from my parents of a property in Spain. All taxes are paid there. However, is there anything I would need to declare being a resident myself in the UK?

Thanks in advance.

Oscar Paoli

4 March, 2020 4:29 pm

Hi Alejandro,
No, you will not need to declare it being a resident in the UK.
You will just need to pay your yearly property taxes as non-resident in Spain for the property you have received.
Kind regards,
Ábaco Advisers

Nadina Cole

14 March, 2020 3:28 am

I am a non resident and have recently sold my property and my lawyer does not have my 211 form (3% retention). Where can i get a copy.

Oscar Paoli

16 March, 2020 5:22 pm

Hi Nadine,
You may check at the notary you signed the sale or with the buyers.
Kind regards,
Ábaco Advisers

Roy Hall

31 March, 2020 3:45 pm

Hi, If we sell our house in Spain and pay the due Taxation etc, will we have to pay some Tax again to England HMRC! for the same sale.

Thanking you.

Oscar Paoli

1 April, 2020 10:57 am

Hi Roy,
In the case the Tax has to be declared here on the 210H but also under the Double Taxation treaty in their own country deducting any Tax paid here from the Tax to pay there.
Kind regards,
Ábaco Advisers