Complete Guide to Selling Property on the Costa Blanca: Costs and Legal Requirements

Selling a property on the Costa Blanca involves various costs that can impact your overall profit. Being aware of these costs and budgeting for them can help you manage your finances effectively and ensure a smoother transaction. Here’s a comprehensive guide to the costs associated with selling property in this beautiful Spanish region.

Capital Gains Tax

• What It Is: Capital Gains Tax is levied on the profit you make from selling your property. The tax rate is based on the difference between the sale price and the original purchase price, adjusted for any improvements made to the property.
• Rates: The tax rates vary depending on the amount of gain and your overall income. In Spain, these rates range from 19% to 26% for non-residents and residents, with different brackets for higher gains.
• How to Calculate: Calculate your capital gains by deducting the original purchase price, plus any documented improvements, from the sale price. Consult a tax advisor to accurately determine your tax liability and explore any available exemptions or reductions.

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Plusvalía Tax

• What It Is: Plusvalía Tax is a municipal tax based on the increase in the property’s value since its purchase. It is payable to the local town hall.
• Calculation: The tax is calculated based on the increase in the land value and the number of years the property has been owned. The rate varies by municipality and is influenced by factors such as the property’s location and the local regulations.
• Payment: Plusvalía Tax must be paid before the property can be officially transferred to the new owner. Ensure to check with your local town hall for the exact amount and payment procedures.

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Notary Fees

• What They Are: Notary fees cover the cost of the notary’s services in formalising the sale. The notary prepares and certifies the public deed of sale, which is required for the property transfer.
• Amount: Notary fees typically range from €800 to €1,500, depending on the complexity of the transaction and the value of the property.
• Payment: These fees are usually paid at the time of signing the deed of sale. Confirm the exact amount with your notary before the appointment.

Land Registry Fees

• What They Are: Land Registry fees are charged for registering the property transfer in the Land Registry, which updates the official records with the new owner’s details.
• Amount: Fees generally range from €500 to €1,000. The cost depends on the property’s value and the specific registry requirements.
• Payment: The Land Registry fees are typically paid once the notarial deed of sale has been signed. The notary or your real estate agent can assist with this process.

Real Estate Agent Fees

• What They Are: If you use a real estate agent to help sell your property, you will need to pay their fees. Agents typically charge a commission based on the sale price of the property.
• Amount: Real estate agent fees generally range from 3% to 5% of the sale price. The exact percentage may vary depending on the agent’s services and agreements.
• Payment: Agent fees are usually paid upon completion of the sale, out of the proceeds. Ensure you understand the fee structure and any additional costs before engaging an agent.

Legal Fees

• What They Are: Legal fees cover the cost of hiring a lawyer to handle the legal aspects of the property sale. This includes reviewing contracts, ensuring compliance with regulations, and providing legal advice.
• Amount: Legal fees vary based on the complexity of the transaction and the lawyer’s hourly rate or flat fee. Budget for approximately €1,000 to €2,000.
• Payment: Legal fees are typically paid at various stages of the transaction. Discuss the payment terms with your lawyer in advance.

FAQs: Understanding the Costs of Selling a Property on the Costa Blanca

What is Capital Gains Tax and how is it calculated when selling a property in Costa Blanca?

• Answer: Capital Gains Tax is a tax on the profit you make from selling your property. It’s calculated by subtracting the original purchase price and any documented improvements from the sale price. The tax rate varies from 19% to 26% depending on the amount of gain and whether you are a resident or non-resident. For precise calculation and possible exemptions, it’s advisable to consult a tax advisor.

What is Plusvalía Tax and how do I determine the amount I owe?

• Answer: Plusvalía Tax is a municipal tax based on the increase in the property’s land value since you purchased it. The amount owed is calculated by the local town hall and depends on factors such as the length of time you’ve owned the property and the increase in land value. To determine the exact amount, you need to contact your local town hall, as rates and calculations can vary by municipality.

What are the typical costs associated with notary and Land Registry fees when selling a property in Costa Blanca?

• Answer: Notary fees for formalising the sale typically range from €800 to €1,500, depending on the complexity and value of the transaction. Land Registry fees, required for updating property ownership records, generally range from €500 to €1,000. These fees are paid during the final stages of the property sale process. Ensure you confirm the exact amounts with your notary and check with the Land Registry for precise fees.

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