THE SELLING PROCESS

If you are selling a property, the basic procedure is, of course, the same as for buying. A priority for you is to make sure that you choose an estate agent with whom you feel confident, and to ensure that the commission structure is clearly understood.

Once a sale has been agreed, you need to give the following documents to your conveyancer to enable quick progress to be made:

• Original Escritura Pública (Title Deeds)
• Copies of your last IBI/BASURA receipts
• Copies of your last utility bills (water, gas, electricity)
• Copy of your community statutes, with the name and address of the community administrator
• Copy of your last receipted community bill
• An inventory of any furniture included in the sale
• If you are a resident of Spain, and therefore not subject to the 5% retention (see below), you have to bring your residencia card.

5% Retention

If you are a non-resident of Spain, the buyer must retain and pay 5% of the declared sale price to the tax authorities at the time of completion, on account of any taxes you may owe, in particular any Capital Gains Tax liability you may have (see below). If, in fact, your Capital Gains Tax liability amounts to less than the 5% retention you can, following completion, complete and submit tax form 212 within 30 days and request a refund of the excess. The refund should be made within 90 days of submission of the completed form. If, on the other hand, your Capital Gains Tax liability amounts to more than 5%, you need to complete tax form 212 and submit this to the tax authorities with the extra payment within 30 days of the sale.

Plus Valía

Please see the section entitled “Costs, Fees and Taxes”. This tax is usually paid by the seller, but is normally only a few hundred Euros.

Capital Gains Tax

You are liable to pay Capital Gains Tax on your net profit. Your net profit is calculated by taking the figure you are selling for and deducting (i) the costs of selling, (ii) the initial price for which you purchased the property, (iii) all costs & fees incurred in the purchase and sale of the property and (iv) the statutory inflationary allowance. Non-residents of Spain are taxed at a flat rate of 35% and residents at the maximum rate of 15%. As a resident of Spain you are exempt from paying Capital Gains Tax on your net profit if the property being sold is your only or main residence and you purchase another property for the same value or more within 2 years of the sale. If the property you purchase within 2 years of the sale is worth less than your net profit, the relief is apportioned accordingly.