Skip to content

Conditions for foreigners to buy a property in Spain

If you are a foreigner who is looking for an investment opportunity in Spain through the real estate market, you should know which are the documents and fees to pay necessary to make the purchase of a property. Whether will be for personal use or to rent, taking advantage of the profitability offered by the Spanish market, there are several essential documents to deliver.

Foreigner Identification Number (NIE)

To buy a flat in Spain, it's only necessary to have the Foreigner Identification Number (NIE), which is a personal, unique and exclusive number of a sequential nature. It's possible to request the NIE through a representative with a history of government delegations and sub-delegations. And in the immigration offices. From abroad it's also possible to process this document.

When it comes to buying a home, real estate agencies can expedite this process. If the search for housing has been carried out and the property to be purchased is clear, an agent of the real estate property, for example, can draw up a deposit or signal contract that will expedite the processing of the NIE. It is also important to make a tax provision.

Non-Resident Income Tax (IRNR)

All taxes and expenses associated with the purchase of the home must be paid in Spain, that is, VAT (Spanish tax) in case of new housing or ITP (Spanish tax) in case of second hand, as well as the costs of appraisal, notary, agency, and registration. Likewise, taxes such as the IBI or the garbage tax, derived from the purchase of that property, are paid in Spain.

In Spain, there is the Non-Resident Income Tax (IRNR), which is a direct tax levied on the income obtained in Spanish territory by natural persons and non-resident entities, unless they are taxpayers of the Personal Income Tax. It will be understood that a person has his habitual residence in Spanish territory when he stays in Spain more than 183 days during the calendar year. In this case, it is taxed by IRPF, not by IRNR.

Everything will depend, however, on whether or not a personal tax is supported abroad and on the existence of double taxation agreements. Thus, for example, in terms of the returns on real estate capital, it would be necessary to establish the tax base on the cadastral value or, if the property is rented, on the annual income obtained. The general rate of the IRNR is 24%.

Residence permit

The registration is not the same as the residence permit. The municipal register depends on the municipality and it must be registered all people living in the municipality, whether national or foreign, the latter having their status regularized in the Registry of the Ministry of the Interior or not.

Regarding the residence permit, until now the purchase of a house in Spain did not guarantee to obtain a residence permit. If previously it was done with that intention, the non-resident foreigner had to request a non-profit residence authorization, fulfilling a series of requirements.

Bank account in Spain

Having a bank account in Spain isn't mandatory, but it is recommended, this opening is free, it opens in about 10 minutes and you can close it whenever you want.

The bank account is necessary for the accumulation of the means of payment of the buyer in the acquisition of the property, and in the future, for the payment of maintenance costs and taxes, which have to be paid in Spain (VAT and Legal Acts Documented in case of new housing, ITP in the case of second-hand residences, notary fees, management and registration, as well as the IBI and the garbage tax) and therefore having it facilitates the process.

Credits: abc.es, apimonteleon.com

(Visited 1,112 times, 94 visits today)

6 thoughts on “Conditions for foreigners to buy a property in Spain

  1. Asa Ebrahim

    I am a US citizen and planning to buy a second/vacation home in Spain for personal use. If lets say for instance I buy a house/flat for 200.000 (two hundred thousand) euros, what would be the yearly taxes I would have to pay for that property.

    Thank You

    Reply
      1. SpainHouses.net (2)

        Hello, there are three taxes that are paid annually for a property in Spain apart from the taxes at the time of purchase. The taxes that are paid each year are the garbage, water and property tax, each city has a different percentage. To calculate how much you would pay annually you must take into account the location, the cadastral value set by the Ministry of Finance and several other elements.

        Reply
    1. SpainHouses.net (2)

      Hello, there are three taxes that are paid annually for a property in Spain apart from the taxes at the time of purchase. The taxes that are paid each year are the garbage, water and property tax, each city has a different percentage. To calculate how much you would pay annually you must take into account the location, the cadastral value set by the Ministry of Finance and several other elements.

      Reply
    1. SpainHouses.net (2)

      Hello Guadalupe, the Urban Waste Rate or rubbish rate still held by many municipalities, is paid according to the type of housing and its size and serves to pay for the garbage collection service. The more expensive the service, the higher the rate to pay.

      Reply

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.