Necessary documents

• Notarial deed of ownership (Escritura)
• Extract from the land register (Nota Registral)
• Building Permit(s) (Licencia de Obra) and Acceptances (Final de Obra)
• Proof of payment of property tax (IBI) and refuse fee (Basura)
• Certificate of Habitability (Cédula de Habitabilidad)
• If applicable: utility contracts water (alternatively well permits), electricity, telephone, internet
• Energy Certificate (CEE)
• Building plans, floor plans
• Inventory list, if defined furnishings are also being sold
  It is advisable to prepare a photo inventory list for this purpose in order to avoid misunderstandings.
  
  

Taxes when selling a property

• Profit taxation for non-residents
  • Who? Non-residents
  • Amount: 19 % of the sale profit (difference between sale proceeds and acquisition costs; crediting of investments made and costs borne possible)
  • Area of application: If the seller is not resident in Spain for tax purposes, the buyer must withhold 3% of the purchase price as an advance payment on the seller's income tax and pay it to the tax authorities. This is normally done at the time of the notarization of the notarial deed of sale and is handled there by the buyer's lawyer or tax advisor. The purpose of this legal regulation is simply to prevent the Spanish tax authorities from allowing non-residents to sell their property and leave Spain without paying the statutory taxes. If the sum of these 3% is higher than the seller's profit on the sale, the seller is entitled to a refund from the tax office; if the profit on the sale is higher, the difference must be paid retrospectively. A profit tax return must be submitted within 4 months of the notarized sale date.
• Profit taxation for residents
  • Who? Residents
  • The profit is subject to the progressive rate of capital gains tax.
  • Amount: 19 % - 28 % of the sales profit (difference between sales proceeds and acquisition costs; offsetting of investments made and costs incurred possible)
    • < 6.000 € = 19 %
    • 6,001 € to 50,000 € = 21 %
    • 50.001 € - 200.000 € = 23 %
    • 200.001 € - 300.000 € = 27 %
    • > € 300,001 = 28 % (maximum tax on the remaining profit)
  • Area of application: If the seller is a resident, no down payment by the buyer is necessary.
  • Residents are exempt from tax if they sell their main residence and acquire a new main residence. They can be exempted from paying profit tax within two years before and after the sale (only main residence, not second residence).
  • The tax return and taxation of the profit is made in the income tax return of the year of the sale, which must be filed by June 30 of the following year.
• Profit taxation for companies
  • Field of application: If the seller is a Spanish company (e.g. an S.L.), profit taxation is applicable to the difference between the sales proceeds and the book value.
  • Who. Legal entities, such as an S.L.
  • Amount: 25% corporate income tax
• Value Added Tax (Plusvalía Municipal)
  • Taxes the increase in value of the property since the last change of ownership.
  • Calculated by the city administration (Ayuntamiento) on the basis of:
    • Cadastral value
    • Number of years in possession (max. 20 years)
    • Municipality's own tax rate (on Mallorca usually between 15 and 30 % of the increase in land value)
  • This tax is generally paid by the seller or owner, unless the contract stipulates otherwise.
  • Who. All owners, i.e. residents, non-residents and companies.