Transfer Tax Up to 10% in Valencia Region
Transfer Tax changes is something that ABC Solicitors likes to keep their clients informed about, as it does make a difference on the budget when buying a property in Spain.
On August 2nd 2013, the Valencian Government has modified some tax rates related to the purchase and sale of properties.
At the beginning of 2013, the Spanish government increased VAT on NEW BUILD PROPERTIES (properties built and sold new by promoters), from 8 up to 10%. This applies to any properties situated in the Spanish Territory (Valencia, Murcia, Andalusia, Catalonia, Balearic Islands, etc.), regardless of the province where the property is located.
This modification initially was not affecting RESALES (properties that have had more than one owner), which are not subjected to VAT. Resales are taxed with another tax called “Transfer Tax” (Impuesto sobre Transmisiones Patrimoniales). So, resales in Valencia region still accrued tax at 8 %
But, on the 2nd of August 2013, the Valencian Government increased the Transfer Tax rate up to 10 %. So, now, buyers will pay 10 % tax on properties based in the Valencia Region (Alicante, Valencia, Castellon).
Please note that this increase has been only for properties based in Valencia region. Other regions, like Murcia, keep Transfer Tax at 8 % (so far).
Also, Stamp Duty has been increased from 1, 2% up to 1, 5 %. This tax has to be paid:
– In new properties, on top of the 10 % VAT
– When there is a mortgage
– When there is an update of the property deeds declaring a new construction, extension, etc.
|ACQUISITION OF NEW PROPERTIES in Spain||10% VAT +1,5% Stamp Duty|
|ACQUISITION OF RESALES||Valencia Region||Other Regions (e.g.:Murcia)|
|10% Transfer Tax||8% Transfer Tax|
|UPDATE OF PROPERTY DEEDS||1,5% Stamp Duty|
If you would like further details, why don’t you contact us?