Taxes to be paid by non-residents when selling in Spain.

FIVE TIPS that should be taken into account before exchanging contracts when selling in Spain.

Some clients come to us when they have already exchanged contracts for their property in the sun, thinking that because they are not buying, it is all simple, straightforward and that they simply have to ensure they get the money they have agreed, which will be all dealt by an estate agent who will find the perfect buyer and will ensure all goes well… so we find quite often clients who think they do not need to seek legal advice before selling in Spain or sometimes they come too late.

The truth is that although, there are much more checks to do and steps to follow when buying, at the time of selling property in Spain there are also important aspects to take into account to avoid surprises and more importantly, to avoid finding that part of the money will be withheld without the clients understanding why.

Let’s list FIVE TIPS that should be taken into account before exchanging contracts when selling in Spain:

Estate agent’s fee agreement.

Is likely that you migth be using an estate agent who will get a commission over the price. Commissions normally are around 5% and the fees will be vatable at 21%. It is important that the seller’ Spanish lawyer carries out a quick check to the agent’s fee agreement before signing it.

Private contract.

When signing a private contract (in Spanish “contrato de arras”) the seller will be committing him or herself to sell the property to the buyer. 10% deposit should be paid to the seller (in Spanish “arras”) which is non-refundable. Should the buyer decide not to go ahead with the purchase or fails to complete, the most likely consequence is that he/she will lose the amount paid, which will be kept by the seller. In Spain, is quite common for the deposit to be transferred to the client’s personal account or to the estate agent’s bank account rather than going to their solicitor’s. There are obvious reasons that make more advisable for the seller to ask for the money to be sent to his/her lawyer’s client account but if an independent Spanish lawyer has not been engaged before exchanging contracts, you might be receiving money without the necessary AML and source of funds’ checks.

On the other hand, if it is you i.e. the seller, who does not honor the contract, you will have to refund the 10% deposit plus its double, as compensation to the buyer. Therefore, it is important that before the seller signs the private contract, he/she is 100% sure that he/she will be able to honor the contract and makes sure that all the necessary documents that are required at completion are in place, to avoid the buyer alleging a breach of contract.

Make sure that you have all the mandatory documents in place that should be provided to the buyer before completion.

Unfortunately, there is not only providing the seller’s passport and title deed to the buyer. A few other documents shall be gathered before completion and some of them might take some time to be obtained. Therefore, committing to a completion date before ensuring they are all in place could lead to an unnecessary breach of contract.

The seller shall have a NIE number (Spanish Tax Number) in place. If your clients bought/inherited the property long time ago it might be the case that they do not have an NIE number and without it, they will not be able to complete.

The property shall have an Energy Efficiency certificate in place and a habitation licence. These two documents should be obtained by a local architect.

Finally, the seller shall provide to the buyer with the title, IBI receipt (local tax similar to the English Council Tax) and also, a certificate from the Community of Owners of being up to date of payments.

Ensure that you are not selling under value or at least, be aware of the implications of doing so.

A Spanish lawyer will check the Minimum Taxable Value of your property, which is not the same than the selling price. In case that the price that has been agreed is lower than the MTV, there is a risk for the Spanish Tax Authorities considering that the seller is undervaluing the property and after paying the capital gain tax (explained below) is likely that you will receive a complementary tax return requesting them to pay the excess up to the 3% of the MTV. This is something that should be discussed with a Spanish lawyer who will guide the clients on the best way to avoid unpleasant tax inspections later on.

Make sure that before the price is agreed, you know the costs and taxes that should be paid by the seller.

When selling in Spain is the buyer who pays the majority of costs, such as Notary and Land Registry fees, and the main taxes i.e. Stamp Duty which is around 10% but it is also for the seller to consider some costs and taxes. Again, engaging a Spanish lawyer before accepting an offer for your client’s loved property in the sun will avoid disappointments before completion when they see that the price they have agreed does not go in full to their bank account.

Claudia Font

Dual-qualified Solicitor & Spanish Lawyer


gunnercooke llp

Can I apply for Spanish passport?

Spain does not recognizes dual passport with most of the countries, being one of them, the UK. Can I apply for Spanish passport?

However, If you are British citizen and your father is Spanish, you should be considered Spanish by origin. However, if you have never had Spanish passport you might have lost your Spanish nationality and you can apply for its recovery.

If it is your mother who is Spanish and you were born after the Spanish Constitution, the situation is exactly the same.

However, if you are the son or the daughter of a Spanish mother and you were born before the Spanish Constitution, you are not considered Spanish by origin, because at that time only men transferred the nationality to the children. In that case, you can opt for Spanish nationality.

These are two different routes to obtain Spanish nationality i.e. the recovery and the option, which proceeding is very similar, but is not the same.

Claudia Font


Spanish Desk

gunnercooke llp

Claudia is a dual-qualified Spanish lawyer and English solicitor duly registered with the Law Society of Barcelona, Spain as well as the Law Society and the Solicitors Regulation Authority in England and Wales. She has practised for over 15 years and she focuses on advising English clients with Spanish interests and also Spanish companies with interests in the UK. Prior to joining gunnercooke, Claudia worked in a number of leading Spanish firms in her native Barcelona, before founding her own firm.

How we can help Private Client Solicitors.

How we can help Private Client Solicitors?

This video aims to help Private Client solicitors that from time to time might find clients with Spanish assets.

Hove you very dealt with an English Will for a client who has assets in Spain and you are not sure whether to recommend to put a separate Spanish Will in place or not?

When dealing with an estate for a client who had a property in Spain, you are not sure how to deal with it?

We are here to help!

gunnercooke llp is one of the few law firms in the UK with two qualified Spanish lawyers duly registered who are English speaking and able to advise individuals and companies in respect of their assets and investments in Spain.

The Spanish Desk at gunnercooke LLP was formed by Antonio Guillen and Claudia Font who work from our Manchester office. Both are qualified to practice Spanish Law and duly registered with the Law Society of Barcelona, Spain as well as the Law Society and the Solicitors Regulation Authority in England and Wales.

The team advises on a wide range of matters from private client, to commercial property and corporate business structures. They work closely with other specialists in the firm, to ensure that they can support on any legal challenge that an individual or business may face when operating or transacting in Spain or Spanish speaking countries.

Claudia Font


gunnercooke llp