TAX ON PROPERTY

When you have a property in Spain there are various axes that you have to pay. You will need to pay Spanish yearly property tax (impuesto sobre bienes inmuebles) this is also known as IBI. This tax is set by your local authority an therefore varies from region to region. The tax is calculated by the size and value of your property and the land that your property is built on and that surrounds your land (which you own). You pay this tax yearly and there are two ways in which you can do this. You can both go to the local tax office (called SUMA) and pay it directly or you can receive a letter once a year stating how much is due and you can go to your bank and arrange that the money goes out of your account and to the local authorities. Another type of tax that you will have to pay when owning a property in Spain is yearly rates. This is where you have to pay your local council taxes for maintenance, rubbish collection and also street lighting. This tax also varies in cost from region to region.

Tax when You Sell Your Property (Plusvalia):

Plusvalìas tax is the tax that you have to pay on your property. This tax is based on the value that the land had when you purchased it and the value that it has when you go to sell it. The local authorities base the amount of plusvalia to be paid on the area the land is located in. The market value or sale price of the property does not affect the plusvalia at all. What normally happens is that the person who is selling the property pays the tax however this is not always the case and so you should make sure you know what you are doing when selling the house.

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