Tax Advice for Buying Property in Marbella: What You Need to Know
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Taxes are one of the most misunderstood parts of buying property in Marbella. Here is a clear breakdown of what you pay, when you pay it, and what to do about it.
The taxes no one explains clearly
Tax is one of the areas where people buying property in Marbella most often get caught out - not because the rules are secret, but because no one explains them clearly before you are already committed. Here is the honest version.
Transfer tax (ITP) - resale properties
If you are buying a resale property (one that has been sold before), you pay Impuesto de Transmisiones Patrimoniales - the transfer tax. In Andalucia, this is set at 7% of the purchase price. So on a 500,000 euro property, that is 35,000 euros in tax alone. This is paid by the buyer, not the seller, and is due within 30 working days of completion.
VAT and stamp duty - new build properties
New build properties do not pay ITP. Instead, you pay IVA (Spanish VAT) at 10%, plus AJD (stamp duty) at 1.2% in Andalucia. On a 500,000 euro new build, that is 50,000 euros in VAT plus 6,000 euros in stamp duty - significantly more than the resale rate. Worth factoring in when comparing resale versus off-plan.
Notario fees and land registry fees
These are set by a regulated tariff and are typically modest - usually 1,000-2,500 euros each depending on the purchase price. Your lawyer will give you an accurate estimate.
Legal fees
Independent property lawyers typically charge around 1% of the purchase price (plus VAT), with a minimum fee often around 1,500-2,000 euros. Worth every cent.
Ongoing property taxes once you own
IBI (Impuesto sobre Bienes Inmuebles) is the annual property tax charged by the local authority. The amount depends on the catastral value of the property - typically a few hundred to a few thousand euros per year. It is paid annually and can be set up as a direct debit from your Spanish bank account.
If you are a non-resident who does not rent the property, you still pay an annual imputed income tax on the property - based on the catastral value at a rate of 1.1-2%, then taxed at 19% (EU residents) or 24% (non-EU residents). Small in absolute terms but worth knowing about.
Capital gains tax when you sell
If you sell at a profit in the future, the gain is taxable. Spanish capital gains tax rates for non-residents currently run at 19% for EU/EEA citizens and 19-23% for others. The seller is also subject to a municipal capital gains tax (plusvalia). Talk to a tax adviser when planning a sale, not after.
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Check if it's still free - PlanMarbella.comFrequently Asked Questions
What is the total tax cost of buying property in Marbella?
For a resale property, budget 7% transfer tax (ITP) plus 1-2% for notario, registry, and legal fees - so roughly 8-9% total. For new builds, 10% VAT plus 1.2% stamp duty plus fees - roughly 12-13% total. Your lawyer will give a precise figure once you have a specific property.
Do I pay tax on my Marbella property if I never rent it out?
Yes. Non-resident owners who do not rent pay an imputed income tax annually. The amount is modest - calculated as 1.1-2% of the catastral value, then taxed at 19% or 24% depending on your residence status. Most buyers are surprised to discover this but the amounts are typically small.
Can I reduce my Spanish property tax through a Spanish company structure?
Some buyers hold Spanish property through a company structure. The tax implications vary significantly depending on the structure and your overall situation. This is worth discussing with a specialist cross-border tax adviser before committing to any ownership structure.