Article supplied by Welex Lawyers & Accountants
When you sell a property in Spain, you must take into account that the profit you obtain is subject to tax. This is the Spanish capital gains tax, which is also known as “ganancias patrimoniales”. The current applicable rate of the Spanish capital gains tax is 19 per cent for non-tax residents in Spain. It is applied to the difference between the sale price, less the amount for expenses and taxes inherent to the sale price paid by the seller, and the purchase price paid, plus the expenses and taxes inherent to the purchase, which will be added.
Keep in mind that, when the seller is a non-resident of Spain, the buyer is required to retain three per cent of the
purchase price, which is deposited in the Public Treasury, as payment on account for the corresponding capital gains tax for the seller that arises from the sale of the property. In the case of the non-existence of a gain or when the withholding of three per cent exceeds the amount that must be paid by the seller, he/she will be entitled to a refund of part or all of the aforementioned retention. In this case, when requesting the refund, the tax authorities
may proceed with the return within six months from the deadline established to submit the refund request or can
carry out a provisional tax assessment. After six months without ordering the payment of the refund for reasons not attributable to the taxpayer, the corresponding interest for a late payment will be applied to the outstanding amount to be refunded.
CAPITAL GAINS TAX EXEMPTION
You should take into consideration that there is a partial 50 per cent exemption on the profits obtained from the
sale of a property acquired between 2 May 12 2012 and 31 December 2012. This exemption will not be applicable,
among other assumptions, when the sale is made in favour of the spouse or a family relative up to the second degree, which includes children, siblings and grandparents.
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