As a consequence of owning property in Spain the following taxes will be encountered at one time or another:-
VAT/IVA
Purchases of new properties are subject to VAT at 8%
Transfer tax (ITP)
Purchase of re-sale properties are subject to transfer tax at 7% up to EUR400,000 and at 8% on any amount exceeding EUR400,000
Purchase of re-sale garages are subject to transfer tax at 7% up to EUR30,000 and at 8% on any amount exceeding EUR30,000
Stamp duty
Purchases of new properties are subject to stamp duty at 1%
IBIU (Impuesto Bienes Inmuebles Urbana)
All properties in Spain must pay annual rates (IBI). Correctly it is paid by the person who occupies the property on the 1st January in any year. This tax is collected by the local Town Hall and is based on the rateable value (valor catastral) of the property.
Refuse tax (Basura)
Most properties are separately accessed to rubbish collection charges. Refuse taxes are normally levied by the local Town Hall
Plusvalía (Impuesto Sobre El Incremento Del Valor De Los Terrenos De Naturaleza Urbana)
Plusvalía is a municipal tax and is levied by Spanish Town Halls on the increase in the value of urban land (excluding the value of any buildings) when there is any change of ownership (ie sale or inheritance).. The tax rate varies depending upon the size of the local population and also the length of ownership. A declaration must be made by the vendor within 30 days and the appropriate tax paid. Correctly in the case of a property sale it is the seller that pays this tax.
Imputed income tax
The property owners' imputed income tax is based on a deemed rental income. The tax is calculated based on the rateable value (valor catastral) of the property. The rental income is deemed to be 2% (1.1% if the valor catastral has been revised since 1994) of the rateable value and one is then taxed on that amount at 24% which is the non-resident flat rate of income tax.
Wealth tax
Spanish wealth tax was abolished in 2008 so the last year of assessment was 2007. Residents and non-residents were liable to Spanish Wealth Tax. Residents were assessed to this tax on their worldwide assets but were allowed a personal wealth level deduction of EUR108,182 plus an own home deduction of EUR150,253. For couples the rates are multiplied by 2. Non-residents were assessed on Spanish assets only and were not permitted to claim any deductions. The tax rates vary between 0.2% and 2.5% on total net wealth
Capital gains tax
Any gain made on the disposal of an asset (ie sale of property) is assessed to capital gains tax at a rate of 19% (1 Jan 2007 to 31 Dec 2009: 18%).
