CONVEYANING COSTS
Once you own your new premises various conveyancing charges and taxes have to be paid by both the seller and the purchaser.
Please note that the tax amounts can vary for a newly built property. In addition, these taxes are nothing to do with the annual municipal taxes for rubbish removal (Basura) and rates (IBI), nor do they have any bearing on the annual non-residents taxes for Patrimonio and Renta.
So, the purchaser of a re-sale property must pay a Property Transfer Tax, which amounts to 7% of the declared value of the property. The purchaser has 30 working days of the date of the escritura to pay this tax. The tax applies whether the buyer is resident or non-resident. This is the only conveyancing tax liability a purchaser has on a resale house (but remember they are also responsible for the notary and property registry fees).
The seller has a land value tax (Plus Valia) to pay, which is calculated by the relevant Ayuntamiento (Town Hall) upon production of the escritura. Broadly speaking, it is a tax covering the increase in land value since the property purchase, so you can assume the longer you have held the property, the higher the tax. The seller has three months to pay a Plus Valia. Please note that if this tax is not discharged, the Town Hall will look to the subsequent owner to honour the debt. It can take two years for a non-payment of plus valia to come to light, so if you are buying a property, do try to ensure the sellers have administered this payment.
