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Copyrighted © 2022. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
1st of November 2022

On selling property in Spain, you are liable for two taxes (more on this in our taxation article: Taxes on Selling Spanish Property – 8th December 2014):

• Capital Gains Tax (CGT)
• Plusvalia tax.

The first tax is national and set by the government.

The second one, is a devolved competency to municipalities (read town halls). They are free to set the rate within a sliding scale supplied by the government. The government will be adjusting the coefficients (read moving the tax goal posts) as from the 1^st of January 2023 in the new budget law. In plain English, town halls will have free rein to increase by as much as 50% Plusvalia tax as of next year.

If you are selling property in Spain, you should seriously factor this in on negotiating a sales price. Unlike CGT, there is no escape from paying Plusvalia tax. The reason is that buyers practice a retention on all non-resident sellers, so no matter what the tax is always paid to the town hall.

The importance of this cannot be understated if you are a seller. The smart thing would be to sell now, during 2022, even accepting a small discount on the sales price, as effectively you are going to pay this tax increase anyway on selling it as from next year onwards.

So next time you are negotiating with a buyer the asking price, keep my tip in mind. You may as well knock off a few thousand euros in the sales price to secure a sale now, during 2022, and save yourselves paying thousands more in 2023, and beyond!

You’re welcome.

We offer this conveyance service: Conveyancing in Spain – Selling

At Larrain Nesbitt Abogados we have over 19 years’ experience buying, selling, and renting properties. We are also specialized in taxation, immigration & residency visas. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88, or by completing our contact form to book an appointment.

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Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.022 © Raymundo Larraín Nesbitt. All Rights Reserved.