Legal & Financial

If you will decide to buy a property with us, Southern Spain Properties, we will try to give you the best service as possible.
We will help you to sort out all the details of your purchase and give you any tips you need to make the process run a lot smoother.
For example below you will find helpful information on some of the legal and financial ins and outs of buying a property here in Spain.
Take your time to browse through this section, familiarizing yourself with what is entailed in buying a property.
Further information is available.

When purchasing property in Spain it is better to get a mortgage. We work in association with the Deutsche Bank which lend up to 70% of the value of the property.. A spanish mortgage can easily be aranged. All that is needed is proof of income such as a current P60, the last three payslips if employed, and if you are self employed the last three years audited accounts, tax returns and a accountants reference.

Mortgage rates are normally fixed for the first year and variable thereafter, Most banks in Spain charge a setting up fee of up to 2% of the mortgage.

If you require financial advice then you can call us for more information.

We will introduce you to an English speaking solicitor who will deal with all the legal matters associated with the purchase of the property.

We will also introduce you to a Fiscal Representative which is similar to an accountant as this is compulsory for all non-residents to assist in the administration and collection of taxes and rates in Spain.

A person who is considered to be a non-resident is someone who does not reside in Spain for more than 183days per year and if their economic interest lie outside Spain.

Spain operates on a self assessment basic for the collection of Income Tax. The Fiscal Representative will complete all the relevant forms, pay the taxes due and with in the specified time and send all the details to the Hacienda ( Spanish Tax Authority.) This must only carried out by the Fiscal consultant or there will then be a fine for not obeying the legislation to appoint a Fiscal Representative.

New Properties:

VAT IVA: ( Impuesto sobre Valor Añadido) is charged at 7% on the declared value of the property.

Stamp Duty AJD:( Impuesto sobre Actos Juridicos Documentados) is 1%.

Resale Properties:

Property Transfer Tax ITPADJ:(Impuesto de Transmisiones Patrimoniales y Actos Juridicos documentados) is 7%.

Other costs: Tax on rise in value of land Plus Valia is charged at 0.1%

Notary Cost: app. 600.00€

Land Registry Fee: app. 300.00€

Solicitors Fee: For the searches on the property, preparation of Title Deeds and translation before a Public Notary.
                         app. 600.00€

Water & Electricity connection fee

New Properties: Drawing up of contract of ownership. App. 360.00€

Resale Properties: Changing of ownership. App. 100.00€

Notary cost may vary depending if you are arranging a mortgage through a bank there will be an additional set up fee as there is a mortgage deed and separate registration fee.

As an normal guide for all the cost associated with a purchase is 10%

Community Fee: This depends on the size and location of each individual property and the amenities of each complex. This can vary between 60.00€ and 500.00€

Local Rates Suma: This is for services provided by the council and is 210.00€ app.

Electricity & Water: Standing charge for the year paid by direct debit 120.00€ app.

Income Tax: Approximately 0.5% of the property value.

Insurance: Building and contents 180.00€ app.

Fiscal Representative: Dealing with annual tax returns and handling debits for water, electric and insurance, 90.00€ approx.