Documentation buying and selling luxury house
Promora offers a guide with all the information required to purchase or sell real estate in Madrid (Spain). Select the relevant section:
- SALES DOCUMENTATION
- PURCHASE-SALE TAX
- SALES EXPENSES
- SALES DOCUMENTATION
- PURCHASE-SALE TAX
- SALES EXPENSES
SALES DOCUMENTATION
First copy of the Deed of Sale (Title).
Last receipt of the Property Tax (IBI).
Certificate of being up to date in the payment of owner's association fees issued by the Property Manager thereof.
National Identification Document (DNI).
Power of attorney in the company owning the property (if it is not a natural person).
In case of matrimony, both spouses must attend or the authorisation of the one that does not attend.
Receipts of: electricity, water, gas (or oil or propane) and telephone for changing the bank direct billing.
Last Technical Inspection of the Building (ITE), issued by the competent Town Hall (in the case of Madrid, it is done by the "Gerencia de Urbanismo" Town Planning Management)
PURCHASE-SALE TAX
In the Autonomous Region of Madrid:
Buyers
Sellers
Personal Income Tax (IRPF)
Personal Income Tax will be 15% on Capital Gains:
Capital Gains = Sales Price, minus expenses - Purchase price, including expenses.
Applicable exemptions
Total
Partial
11,11% x (A-2)
Where A is the year when the property was purchased
In the Autonomous Region of Madrid: Buyers
VAT (7%) in the case of a first transaction, i.e., when purchasing from the promoter or builder.
Tax on Capital Transfers (Impuesto de Transmisiones Patrimoniales ITP) (7%) in the case of second or subsequent transfers
Documented Legal Acts (Actos jurídicos Documentados AJD) (1%) when the operation requires VAT
Sellers
Tax on the Increase in the Value of Urban Land (Impuesto sobre el Incremento del Valor de los Terrenos de Naturaleza Urbana)
Personal Income Tax (Impuesto Renta Personas Físicas (IRPF)), in the annual statement or Company TAx (Impuesto de Sociedades) in the case of legal entities)
Personal Income Tax (IRPF)
Personal Income Tax will be 15% on Capital Gains:
Capital Gains = Sales Price, minus expenses - Purchase price, including expenses.
Applicable exemptions
Total
When the seller is over 65 years of age
When the property was acquired before 31 December 1986
When the seller has owned the property for over 3 years and reinvests 100% of the price in buying another property.
Partial
If acquired before 31 December 1996, the following can be deducted:
11,11% x (A-2)
Where A is the year when the property was purchased
SALES EXPENSES
Notary fees
As a mere estimate, for sales of 600,000 Euros or more, the expenses will be 560 Euros plus 0.3% of the amount over these 600,000 Euros
Registration fees
Also as an estimate, for sales of 600,000 Euros or more, registration will cost about 300 Euros plus 0.2% of the amount that exceed the 600,000 Euros. Further information: The Tax Office (Hacienda) has an information telephone number to call to clarify any subject related to taxes: 901 33 55 33. The consultations are merely informative and not binding.
Notary fees
As a mere estimate, for sales of 600,000 Euros or more, the expenses will be 560 Euros plus 0.3% of the amount over these 600,000 Euros
Registration fees
Also as an estimate, for sales of 600,000 Euros or more, registration will cost about 300 Euros plus 0.2% of the amount that exceed the 600,000 Euros. Further information: The Tax Office (Hacienda) has an information telephone number to call to clarify any subject related to taxes: 901 33 55 33. The consultations are merely informative and not binding.
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