Whether you are selling your home privately or with the help of an estate agent, there are several important decisions you will need to make. Laakso Law & Advisors, SLP will ensure that when you sell your Spanish property all taxes you are liable for are correctly settled and paid, and that you are not going to be liable for any future claims. Also our team will assist you to avoid overpaying any Spanish taxes relating to Capital Gains, so you can save some significant sums by getting the right advice.
If you are selling a property in Spain you need to be aware that the procedure is very similar to the one of buying it.
First, it is advisable that you to talk to several estate agents in order to find one that you feel reliable. Commissions will vary with different estate agents so it is important to be clear on what you will be expected to pay when the house sells.
Preparing your sale
As soon as the seller has accepted an offer for the property it is usual to prepare a sales private contract. The main conditions on the sale will be reflected in the private contract (the property being purchased, the price and the way of payment and the completion date). Also a deposit is paid to guarantee the property is withdrawn from the market. It is very important to be advised properly before signing a document like this. Our solicitors will provide you expert guidance from the beginning of the sale procedure to ensure that contracts, title deeds, and taxes are drafted, signed, and administered as legally required.
Before completion, our team will make some checks about utilities, local rates (IBI/Suma), community fees and rubbish collection. Also if there is a mortgage upon the property we will contact y our bank to coordinate the cancellation of the existing mortgage.
We may assist you to obtain an energy performance certificate and an occupancy certificate.
As the seller, please note you might be liable for the payment of plusvalia tax and capital gains tax.
Plusvalia tax is paid to the Town Hall where the property is located. This is not a fixed tax, so we need to know the completion date and to make some enquiries before confirming your tax liability.
Capital Gains Tax is paid by residents in Spain on their worldwide assets and by non-residents on property that they own in Spain. The taxable item is the profit (gain) you make on selling an asset. Basically the taxable profit is the difference between the transfer value and the acquisition value.
In the event that the seller is a non-resident in Spain, the buyer is legally obliged to retain 3% of the sale price on the sale completion and that is withheld by the Tax office until your Capital Gains Tax liability has been settled. If the retained amount is higher than the tax liability, the seller will be entitled to a refund of the difference. If the amount is lower, the seller is obliged to pay the outstanding capital gains tax.
After making the searches, knowing the mortgage balance and calculating the plusvalia and capital gain tax liabilities, we will give you a breakdown of the fees and outlays involved in the sale and the exact amount that might be retained to you to guarantee the payment of any outstanding bills.
Completing your sale
When the time comes to complete the sale, the Title Deed (Escritura) is signed before a Public Notary. The buyer and seller must attend signature of the Title Deed together at the Notary’s Office. However, Laakso Law & Advisors, SLP can attend on your behalf having Power of Attorney.
Power of Attorney can be arranged either in Spain or in your country.
As part of our sale conveyancing we can:
- provide you legal advice
- draft the sale private contract
- coordinate all parties for completion at the notary
- translation of deeds on completion or completing on your behalf by Power of Attorney
- apply for energy performance certificate and occupancy certificate
- cancel any existing mortgages
- pay your plusvalia tax
- calculate your capital gains tax return
- apply for tax rebates
Having Power of Attorney will also let us:
- cancel the existing direct debits
- close your Spanish bank account
- transfer the sale proceeds to your country
- avoid certain non-resident account bank charges (0.2%-0.4%) via using our client account.
Browse through the below topics to find more information about taxes involved in the sale transaction.
Please contact us and we will prepare a proposal of services that best suits your needs.
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