Buying Costs and Taxes
As a general rule add roughly 15% to your purchase price to cover all your closing costs and taxes. These breakdown as:
VAT (IVA) applies to new bespoke properties and is currently 10% of construction and 21% of land, payable in stages. This was applied from 1st January 2012.
Transfer tax on resales (Impuesto sobre Transmisiones Patrimoniales - ITP) applies to “re-sale” purchases and is payable on completion. The rate of transfer tax (ITP) is 10% from August 2013.
Stamp duty (AJD) is only payable on the purchase of off-plan properties and is currently 1.5%, regardless of the value of the property and is payable on completion.
Plus Valía This is a modest one-off tax levied by the town hall and relates to the increase in value of the land since its previous sale.
For most purchases this tax will amount to only a few hundred euros and is normally payable by the vendor on completion.
Solicitors Fees Normally 1% of the purchase price. Please contact us if you would like us to pass on to you solicitors recently used successfully by our clients.
Notary, Land Registry and Gestoría Fees These are the fees associated with the witnessing and subsequent registration of your title deeds.
Notary fees range vary to a scale fixed by law of between €300 to €1.500.
Land Registry fees are generally about 20% less than the Notary’s fees.
Gestorías are official intermediaries between individuals and government bodies such as: the tax office and the land registry. Their fees are normally around €350 plus VAT, which from 1st July 2010 will be 18%.
When buying resales, we suggest you budget between 13% and 15% of your purchase price to cover all your closing costs and taxes.
Galerie International.com Ltd
Moor Place, Fore Street, Moorgate, London EC2Y 9DT
t: +44 (0) 20 8920 9414