For purchase costs and transfer tax (ITP) in Andalusia you normally need to count with 11 to 12% extra costs (for existing houses without a mortgage). Always as your lawyer for a detailed offer and don´t leave the legal investigation or after-sales to the real estate agent to save costs. All costs are paid to/through the lawyer in a full-service purchase.
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Purchase costs property Andalusia
- Transfer tax: 8% ITP transfer tax (in Andalusia until € 400.000) (from 28/05/2021 to 31/12/2021 temporally 7% for the total purchase price) over the house (and possibly 4% over the furniture)
- Legal investigation: Legal fees of the lawyer for the legal investigation
- Power of Attorney: PoA to the lawyer from a notary
- NIE numbers: Application of the fiscal NIE numbers (Numero Identificacion Extranjeros) at the Police station
- Notary: Fees of the notary for the Title Deeds
- Bank account: Opening bank account through Power of Attorney
- Registration: Registration after completion (Registry & Cadastre) and tax payment by the lawyer
- Land Registry: Bill of the Registro de la Propiedad for the inscription
- Service contracts: Transferring service contract (electricity, water, IBI council tax, basura/environmental tax, comunidad, etc.)
- Spanish will: Signing last will at the notary to determine the inheritance of the Spanish properties (house, bank account, car, etc.)
- Rental license: Potential application rental license RTA (urban) or VTAR (Vivienda Rural) in rustic area or towns with less than 20.000 inhabitants
For New Build properties you don´t pay transfer tax but 10% VAT (IVA) and 1,5% Actos Juridicos Documentados (AJD tax) (from 28/05/2021 to 31/12/2021 temporally 1,2%). For separately sold garages and land/terrain you pay 21% VAT.
Marital status determines transfer tax
In Andalusia you pay 8% ITP transfer tax over the first € 400.000, then 9% up to € 700.000 and above 10%. For this your marital status is very important. If you are married in separation of goods (standard in the UK, Germany and Sweden), then this amount counts per person, no per couple. For more expensive properties this of course is less expensive.
So, if you buy a house of over € 400.000 then it´s fiscally beneficial to be married in separation of goods instead of in community of goods. In this case only above € 800.000 you´ll have the 9% tax level. Is separations of goods NOT the standard in your country (like in Holland until 2018 or in Belgian)? Then you´ll need to present your nuptial agreements together with the Purchase Deeds when filing in the Land Registry. They´ll need a legal translation and have an international Apostle of The Hague, which the notary in your country can arrange.
Reoccurring costs Spanish property
For almost all reoccurring costs an automatic direct debit can be set up through your Spanish bank account. This account the lawyer can open on your behalf by the Power of Attorney signed at the notary. Ask him which of the following contracts and reoccurring costs are included in his after-sales works.
- IBI (yearly council tax for your property)
- Basura (environmental tax)
- Electricity / gas (not the butane bottles)
- Water / Comunidad de Regantes (country side)
- Comunidad de Propietarios (Community of Owners)
- House insurance
- TV, telephone, internet
- Exit taxes (for parking garages with direct exit to the street)
- Tax declaration IRNR (yearly income tax for non-fiscal residents with a house in Spain)
- Potential mortgage payments
- When renting out: ór IRNR income tax for non-fiscal residents (4x per year) ór IRPF income tax for fiscal residents, administration costs, commission rental agency, publicity costs, cleaning, maintenance, etc.
Normally costs for correct initial inscriptions in the Land Registry & Cadastre and costs for the DAFO-certificate are paid by the vendor. However, all is a matter of negotiation and all should be clear before completion due to the legal investigation of the lawyer.
Take into account that you buy the house in its current status. Hidden technical deficiencies you can´t bill to the vendor after-wards. It might be wise to have a structural survey by an architect if you have doubts. But keep in mind that also he of course can only see visual defects. Have your real estate agent check the condition of the house, the furniture and service contracts very shortly before completion at the notary.
In the countryside keep in memory that the Town Hall can always oblige you to get the DAFO certificate if you buy without. The tax office will send you an extra bill if the fiscal value is higher than the purchase price. And the electricity company (Endesa) can ask for a boletin (technical report) if the installation is to old. This might be a problem with the name change or raising the potency (kW) of your contract. Do you buy in an urban zone? Then to be sure ask if there won´t be any costs anymore from the Town Hall for the urbanization.
Always make sure you have good house insurance from day 1.
Need a referral for a good estate agent in Andalusia? Or like to receive an example offer for the legal investigation of a specialized and independent lawyer? Find out more through link above.
©2021, Ariane van Wijk