Taxes, explained

At purchase: resale versus new build

The tax you pay on the purchase itself depends on what you are buying, and the two routes are mutually exclusive.

Buying a resale property (from a private owner), you pay ITP — Impuesto de Transmisiones Patrimoniales, the transfer tax. Andalusía flattened its rate to 7 % of the price, one of the more competitive rates in Spain. On a €400,000 apartment that is €28,000, which your lawyer settles at completion.

Buying a new build (first transmission from a developer), you instead pay IVA (VAT) at 10 %, plus AJD stamp duty (Actos Jurídicos Documentados) at 1.2 %in Andalusía. The same €400,000, bought off-plan, carries €40,000 of IVA and €4,800 of AJD. New build costs more in tax — what you get for it is a new property, a builder's warranty regime, and bank-guaranteed staged payments.

One trap worth naming: the tax office can revisit the declared price if it thinks the property was bought below its official reference value (valor de referencia) and tax you on the higher figure. Your lawyer checks the reference value before you commit, so the tax bill never comes as a letter of surprise.

The other completion costs

Beyond tax, completion carries fees. Budget roughly:

• Notary: on a typical purchase a four-figure sum, scale-regulated.
• Land registry: somewhat less than the notary.
• Independent lawyer: commonly around 1 % of the price.
• Mortgage costs, if financing: the bank's valuation fee and possibly an arrangement fee. Since 2019 the bank — not the borrower — pays the mortgage deed's AJD.

The honest rule of thumb for total acquisition costs on a resale in Andalusía: add 10–12 % on top of the price. For a new build, 13–15 %. Budget that from day one and nothing in the process will squeeze you.

Every year you own: the recurring costs

IBI (Impuesto sobre Bienes Inmuebles) is the annual municipal property tax, calculated on the cadastral value — typically a few hundred to somewhat over a thousand euros a year for the kind of property our clients buy, varying by town and property.

Community fees are not a tax but behave like one: they fund the building or urbanisation you co-own. A modest block might charge €80 a month; a resort development with pools, spa, gardens and security can charge €250–500. Ask for the last annual accounts and any planned special levies (derramas) before you buy — this is one of the most commonly underestimated numbers on the coast.

Non-resident income tax is the one that surprises everyone: even if you never rent the property out, Spain taxes non-resident owners on a small imputedincome from it (form 210). The amounts are usually modest — often low hundreds of euros a year — but the filing is mandatory. If you do rent the property out, actual rental income is taxed instead: EU/EEA residents pay 19 % and can deduct expenses; others pay 24 % without deductions.

Add utilities, home insurance and — if you rent out — local licensing requirements, and a realistic running budget for a typical apartment is €2,000–5,000 a year depending on the community.

When you sell

Two taxes sit at the exit. Capital gains: non-residents pay 19 % on the gain, and the buyer of your property is obliged to withhold 3 % of the price and pay it to the tax office on account of your liability — you reclaim the difference if the withholding exceeds the actual tax.

Plusvalía municipalis the town hall's tax on the increase in the land's value while you owned it. By law and custom the seller pays it — resist any contract that quietly pushes it to the buyer, and note that if there was no actual gain, it can be contested.

The one-paragraph summary

Resale: price + 7 % ITP + fees ≈ price + 10–12 %. New build: price + 10 % IVA + 1.2 % AJD + fees ≈ price + 13–15 %. Owning: IBI, community fees, a small mandatory non-resident filing. Selling: 19 % on the gain with a 3 % withholding, and plusvalía on the seller's side of the table. Nothing here is unmanageable — it just needs to be in the budget before you offer, not after.