Real Estate & Taxes
Del Rio Abogados, with more than 60 years of experience, is a highly renowned Law Firm in the Real Estate field. We act as independent legal assistance for the client and only collaborate with the most trustworthy Real Estate Agencies in Spain.
A The Spanish Property Acquisition Process
When the client has decided which property they wish to acquire, we begin to carry out the following steps of the buying process:
1 Real Estate Due Diligence
Comprehensive legal, urban planning, and financial audit. We inspect Land Registry records (Nota Simple) to verify legal ownership, outstanding mortgages, liens, or encumbrances. We audit municipal records to ensure building permit compliance, absence of illegal construction files, and check property tax status (IBI) and community fees
2 Deposit & Reservation Agreement (Contrato de Arras)
Drafting and negotiation of the private purchase agreement. The buyer secures the property by paying a deposit (typically 10% of the purchase price). Under Spanish law (Arras Penitenciales), if the seller withdraws, they must return double the deposit amount; if the buyer fails to proceed without legal justification, the deposit is forfeited.
3 Completion at Notary (Escritura Pública de Compraventa)
Formal execution of the Public Deed of Sale before a Spanish Public Notary. Legal representation is provided during the signing ceremony, ensuring key purchase conditions, balance payment transfers, and key handover are executed flawlessly.
4 Post-Completion, Tax Settlement & Land Registry Recording
Payment of corresponding transfer taxes, presentation of tax returns to regional authorities, and final inscription of ownership at the official Land Registry (Registro de la Propiedad).
B Other Essential Services
NIE Number Acquisition: Mandatory tax identification number for foreign buyers to execute real estate transactions, open bank accounts, and pay taxes in Spain
Digital Certificate Setup (FNMT): Obtaining official digital signature keys from the Fábrica Nacional de Moneda y Timbre to enable remote administrative signatures and legal filings.
Power of Attorney (POA): Drafting and execution of specific or general POAs at a Spanish Notary or foreign consulate, allowing our legal team to complete all transactions remotely on behalf of the investor.
Mortgage & Financing Optimization: Assisting foreign buyers and non-residents in securing competitive mortgage rates and financing options through Spanish financial institutions (typically financing 60%–70% LTV for non-residents).
Planning to buy property and relocate to Spain? Explore our Legal Residency & Immigration services for guidance on available residence permits and international relocation.
C Real Estate Taxes & Local Fees Overview
| Tax / Fee Category | Community of Madrid | Andalucía (Costa de la Luz & Costa del Sol) | Key Tax Basis & Notes |
|---|---|---|---|
| Resale Property Tax (ITP) | 6% (Flat Rate) | 7% (Flat Rate) | Calculated on the agreed price or Cadastral Reference Value (whichever is higher). Reduced rates available in Andalucía for buyers under 35 or with residence under €150k. |
| New Build Property (VAT / IVA) | 10% | 10% | Applies to brand-new properties bought directly from developers/builders. |
| Stamp Duty (AJD) | 0.75% | 1.2% | Applies only on new construction transactions subject to VAT. |
| Municipal Property Tax (IBI) | 0.4% – 0.5% annually | 0.4% – 0.8% annually | Annual local real estate tax paid to the local Town Hall (Ayuntamiento) based on cadastral value. |
| Other Local Municipal Fees | Rubbish Fee (Tasa de Basuras), Driveway Access (Vado). | Rubbish Fee (Tasa de Basuras), Driveway Access (Vado). | Annual or bi-annual municipal charges varying by municipality and property specification. |
| Non-Resident Income Tax (IRNR) | 19% (EU/EEA) 24% (Non-EU) | 19% (EU/EEA) 24% (Non-EU) | Deemed income tax on second homes (1.1% – 2% of cadastral value) or tax on gross rental income. |
Buying Property in Spain?
Get independent legal advice on property purchases, due diligence, contracts and taxes in Spain.
Del Río Abogados
A highly renowned Law Firm in the Real Estate field, acts as an independent legal assistant for the client and only collaborates with the most trustworthy Real Estate Agencies in Spain