Spain Explained

What is the plusvalía tax in Spain?

If you’re selling your property in Spain there are several costs and taxes you have to consider. Some, you’re likely to have heard of before, like capital gains tax or stamp duty. Others, however, are taxes specific to Spain that you may be less familiar with. One such charge is the plusvalía tax. In this article, we cover what exactly this charge is and how to calculate what you will have to pay. Armed with this basic information, you can navigate a Spanish property sale with confidence.

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A tax on the value of the land

In Spain, every autonomous region has its own laws and tax regulations. Thus, the charges and taxes you will have to pay will depend on the region within which you live. This particularly applies to house sales, where additional taxes will be collected by the local town hall.

One of these taxes is the plusvalía tax. The objective of this charge is to tax the increase in the value of the land that the property is built on. This could be due to improvements to the area carried out by the local government or the community at large. The value is calculated year-on-year, from the date that you purchased the property. Bear in mind that this tax does not only apply to houses; even apartments have their corresponding percentage of land on which the building stands, so this tax is still applicable. 

How to calculate the plusvalía tax

To calculate the plusvalía tax, you should contact a legal advisor. They will need the following information about the home and the potential sale:

  • Details of the property’s location; 
  • A copy of the most recent IBI receipt indicating the current land value or valor suelo; 
  • Information about when the property was purchased and for what price;
  • The sale price;
  • And the estimated sale date.

Once the property is sold, the plusvalía tax is due 30 days after you have signed the sale at the notary.

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It is important to seek professional advice about the amount of tax you are likely to owe. The plusvalía tax has been contentious for some time, as in many instances, the land on which the property stands will not have gained value – but the tax will be charged nonetheless. Therefore, it is important you do not assume plusvalía tax will not apply. Consult with your legal representative for an informed estimate.

Seek expert information about property sales in Spain

Navigating property sales in Spain can be complex, especially if Spanish is not your first language. As each region has its own legal nuances, it is important to seek the advice of a legal expert familiar with local procedure. With the proper advice, you can make sure plusvalía tax is properly factored into your budget.

Ábaco Advisers have more than 20 years experience in Spanish property sales. If you would like to receive more information regarding the sale process or if you wish to receive a cost estimate do not hesitate to contact us. Click here to complete this form and we will get to you at a time that is convenient for you. We look forward to being in touch.

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2 comments

Peter Spring

5 October, 2020 3:53 pm

Thank you for a very good guide very helpful and to understand, also I would like to know that I have a property in Spain and have made a will where I have left it to my 3 daughters, would it be benifishal to change my will so that I donate it to them thus saving them to pay inheritance tax, I would be greatly appreciated for any advice. Peter Spring

Oscar Paoli

5 October, 2020 9:25 pm

Dear Mr. Spring,
Thank you for contacting us.
In many cases a donation may be an easier option. Should you wish a quote and more information about our service please contact us at info@abacoadvisers.com
Thank you very much in advance.
With kind regards,
Ábaco Advisers