I understand that if you own a house in Spain that you have to pay imputed income tax, even if you do not intend to rent out your property (which we wouldn't). I have been told that this is 19% of the value of the property every year!!!! Me and my wife are looking to move out to Spain next year and if this is the case, we can't afford to do so. Please could anyone advise us if this is true and if it is payable year on year. I am hoping that the calculation I have been advised is incorrect, if so does anyone know the correct way of calculating this tax. We intend to live in Spain permanently.
Thank you Warren, that sounds more realistic. Good luck with your new house!
Kind Regards
Nigel
Hi Nigel.
It sounds as though you are referring to the non residents property tax, which as the name suggests is only payable by those who own a property in Spain but do not live there.
Richard
I Richard
Thanks, I have looked up on the internet and unfortunately you have to live in Spain for 6 months before you are classed as a resident for tax purposes, so I assume it is payable then for those first 6 months.
Regards
Nigel
Hi Nigel
We were caught with the property tax thinking that we only had to pay the 10% on top of the property plus Solicitors fees and was caught with £11,000 tax for a year on the property we were looking at, we were so disappointed. Please get a good solicitor we had a good Spanish lady and she worked with us, i was lucky and managed to get my deposit back but did lose 3000 EUROS.
This is what you will have to pay out
notary fees, registry fees, legal fees and the purchase tax which on a £155,000.00 euro property works out to £12,400.00.
Also check on the council tax, refuse collection and your electric, water etc. make sure everything is legal with the town hall before you put any money down.
SUE
Advertisement - posts continue below
Hi Sue
Thanks for your reply. Can I just clarify that you had a 'property tax' of £11,000 as well as the purchase tax of which you have given the example of in your reply. If so, was this property tax just for the first year of occupancy?
Thanks again
Nigelo
Hi Nigel
Sorry it was the Property Tax that was that amount, this you would not have to pay if you were a resident but that can take up to 6 months, however this is something that you would have to check on before you purchase a property, what Estate Agent are you using. ?
Sue
Hi Sue
I have just read your post and I am a liitle confused by what you refer to as a property tax that is not payable if you are a resident.
My understanding is that when buying a property in Andalucia the only taxes payable are VAT and Stamp duty for new properties or Transfer Tax for resale properties. And that these taxes are payable by both residents and non residents. (Although there is relief for disabled people and those under 35 years old).
Is it possible for you to clarify which tax you are refering to when talking about the property tax.
Many thanks
Richard
Richard
Hi Sue
Thanks for your clarification, we don't have an estate agent yet, we are going out in July to find one in Albox. We may decide to rent when we first move out there for 6 months and then look to buy a house; we will be classed as residents by then.
Kind Regards
Nigel
Hi Nigel,
I would strongly recommend getting professional advice as people can sometimes be confused at to which taxes apply to which area. I own a property in Mojacar for a number of years and the annual property tax is in the hundreds not thousands. I use a tax agent based in Vera to handle all of my compliance issues for my house. This includes setting up the direct debit for rubbish, council taxes etc. She files all my tax forms and declares my rental income. I believe that it is very important to have a professional person that is fully registered to make sure these matters are up to date. In the event i ever want to sell (not anytime soon) i want to be sure that there will be no outstanding issues.
You can google search for a company that can do this. For information purposes the company i use is Asesoria Lopez based in Vera and the person i have dealt with for years is Isabell Lopez. I have found her excellent and she speaks English which for me was a big bonus. She has a website www.asesorialopez.com .However please do your own due diligence and use someone that you are happy with.
Hope this helps and i hope that i am not breaking any rules by posting who i use.
Best wishes and dont forget to visit the playa in Mojacar when you are here.
Noel.