Transfer of property of non-residents in Spain

In this blog of Welex lawyers Marbella, we are going to talk about transfer of property of non-residents in Spain and the Non-Resident Income Tax in Spain and what happens when, after the sale of a property, a non-resident obtains a capital gain.

IRNR (Impuesto sobre la Renta de No Residentes) is a Spanish tax on income obtained in Spanish territory by individuals who are not resident in Spain.

IRNR after the sale of a property

Our team of lawyers in Marbella explains the IRNR after the sale of a property.

The first thing to bear in mind is that it is the buyer who is obliged to pay this tax after having withheld 3% of the purchase price (whether or not the buyer is resident in Spain) to the seller (non-resident in Spain) for the payment of this tax.

The buyer will have a period of one month from the date of the transfer to submit the withholding to the Tax Agency using form 211 and must give the non-resident seller a copy of this form so that the latter can deduct the withholding from the resulting tax payable on the tax return of the gain.

Clearly, if the withholding is higher than the tax payable by the seller, the excess can be refunded.

However, to calculate the amount, the following percentages must be applied to the gain obtained after the sale of a property in Spain (the gain is calculated as the difference between the transfer value and the acquisition value).

Transfer and acquisition value of a property in Spain

The acquisition value of a property in Spain will be formed by the real value for which the property was acquired. To this we must add the amount of all the expenses and taxes inherent to the acquisition.

The transfer value will be the actual amount for which the property is transferred. From this we must subtract the expenses and taxes inherent to the transfer as long as these have been paid by the seller.

Therefore, nowadays, after the sale of a property in Spain, 19% of the profit obtained after the sale must be paid as capital gains tax.

For all types of legal procedures related to the purchase and sale of property in Spain, please do not hesitate to contact our expert lawyers in property purchase and sale in Marbella, and they will advise you in a close and personalised manner.