August 8, 2011 at 12:31 pm #56308
What are the typical transaction costs in buying a property in Spain?
I have looked into this to some extent already and from what I have read it seems that one should budget approximately 10% of the price of the property in order to cover the costs in buying a property in Spain to pay for taxes and legal fees, but is this correct?
August 8, 2011 at 3:02 pm #105478
Yes 10% is about right. Maybe 11% if you are buying a new build (the tax is higher).
August 9, 2011 at 12:39 pm #105490
If you are going to apply for a Spanish mortgage be sure to keep and eye on the set up fees and the bank differential rate. They have gone up a lot in the last few weeks. Try to negotiate the bank commissions as best you can. A fixed rate mortgage may be more interesting.
August 15, 2011 at 9:00 pm #105562
I am about to take ownership of a property near Murcia that is “in the family”. A gift, though in current climate, not exactly a welcome one.
Can anybody advise on the cost of doing this – legal fees etc? There will be no money changing hands but there is probably outstadning property tax owed.
August 16, 2011 at 4:48 pm #105569
Money, may not be changing hands but a value will be transfered. If the transfer is due to death than other taxes like inheritance will become payable within 186 days otherwise the outstanding tax will attract interest .
The amount of tax depends on your relationship. However for non residents they may not apply.
August 16, 2011 at 6:50 pm #105570
Thanks Shakeel – no death here – it will just be a transfer from my brother to me. No money changing hands.
How is tax liability (if any) calculated in such a case.
And what is the breakdown on legal fees – we won’t need legal rep. on both sides of this transaction and
I do not require any investigation on Title to take place.
August 16, 2011 at 6:55 pm #105571
You will have to pay property tax the same as an ordinary sale.
August 16, 2011 at 8:12 pm #105572
Releived that no death. As Katy said its like an ordinary sale so if you find out the value from the Tax authorities and work out around 8%-10% you should be pretty much covered
Your brother will have to pay capital gains tax. It depends what gain has been made. I beleive there will be tapering relief & a very small personal allowance of capital gains tax. ( Depending on the region )
I sugguest you get the title etc checked. To establish no surprises exist & if there any outstanding debts issues they can be sorted out now as later it might become more complex & costly.. speak to a good gestor.
I am not sugguesting any bad will or foul play on the part of your brother. Spain being Spain you just dont what shows up. There could be issues which even your brother may not have been aware of during his period of ownwership
August 17, 2011 at 10:19 pm #105611
Thanks – seems like pretty good advice all around.
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