Selling a prestigious property in Marbella requires a nuanced approach. At Estate Agents Marbella, we understand the complexities of the luxury market and provide expert guidance to ensure a seamless and profitable sale. As with any significant transaction, we recommend engaging a qualified legal professional to advise you throughout the process.

Seller's Tax Liability

Capital Gains Tax (CGT)

As a seller, you will be liable for Capital Gains Tax, calculated on the increase in your property's value from the original purchase date to the sale date. Since 1st January 2012, the CGT rate is 21%. Deductible expenses include conveyance costs (purchase taxes, notary fees, legal fees), provided you have official receipts.

Example:

• Original purchase price: €200,000
• Taxes & fees incurred: €20,000
• Selling price: €260,000
• Calculation: €260,000 - (€200,000 + €20,000) = €40,000
• CGT due: €40,000 x 21% = €8,400

Residency Exemptions:

• Residents aged 65 or over, having lived in the property for at least three years.
• If the property is your primary residence and the net sale proceeds are reinvested in another primary residence within two years.

Plusvalía Tax

Typically, sellers are responsible for the Plusvalía Tax, though this can be negotiated. This local tax is based on the increase in land value (not the property's sale price) from the acquisition date to the sale date. The local authorities calculate this based on the property's rateable value and ownership duration.

Encumbrances

Sellers must settle any outstanding encumbrances, such as mortgages, unless otherwise agreed with the buyer. If the buyer intends to obtain a mortgage, they might consider taking over the seller's existing mortgage, provided the terms are favourable.

Important Factors When Selling in Spain

Retention (Non-Residents)

If you are a non-resident and have owned the property for less than ten years, the buyer is legally obligated to withhold 3% of the purchase price and pay it directly to the Spanish Tax authorities. This ensures the payment of CGT. After CGT calculation, you will either receive a refund or be billed for the remaining amount.

Note: If the buyer fails to withhold this amount, they become liable for your CGT.

Declared Selling Price

Historically, under-declaring property values to minimise taxes was common. However, the Spanish Tax authorities now heavily scrutinise property transactions. Significant penalties can be imposed for under-declared values, and information is often shared with foreign tax authorities.

Estate Agents Marbella strongly advises against under-declaring property values.

Our experienced property negotiators have up-to-date knowledge of current laws and tax liabilities. We offer expert advice to all clients who list their properties with us.

If you have any questions or wish to discuss listing your property, please contact us.