Two Taxes When You Sell Property in Spain
When you sell a property in Spain, you face two distinct taxes: (1) capital gains tax on the profit you make — paid to the Spanish national tax authority — and (2) the municipal plusvalía (IIVTNU), a local tax based on the increase in the cadastral value of the land — paid to the local town hall.
Capital Gains Tax: Residents vs Non-Residents
How capital gains are taxed depends on your tax residency status:
Tax Residents (IRPF)
If you are a Spanish tax resident, capital gains from property sales are declared in your annual IRPF return. The gain is taxed at the savings tax rates:
- Up to €6,000 gain: 19%
- €6,001–€50,000: 21%
- €50,001–€200,000: 23%
- €200,001–€300,000: 27%
- Over €300,000: 28%
Non-Residents (IRNR)
If you are a non-resident, the capital gain is taxed at a flat rate: 19% for EU/EEA nationals and 24% for non-EU nationals. The buyer retains 3% of the purchase price and pays it to the Tax Agency as a withholding. You then file Modelo 210 to settle the actual gain — if the 3% exceeds actual tax due, you are entitled to a refund.
Calculating the Capital Gain
The taxable gain = sale price minus allowable costs. The acquisition cost is adjusted for all purchase costs (ITP/IVA, notary, registry, legal fees) and major improvements since purchase. Sale costs (agent commission, legal fees) are deducted from the sale price. Keeping all original purchase invoices and improvement receipts is essential.
Key Exemptions for Residents
Spanish tax residents benefit from important exemptions:
- Primary residence reinvestment: Sell your home and reinvest in another primary residence within 2 years — the gain is exempt.
- Over-65 + primary residence: If over 65, selling your principal home is entirely exempt — no reinvestment required.
- Over-65 lifetime annuity: Sell any property and invest in a qualifying lifetime annuity within 6 months — gains up to €240,000 exempt.
The Municipal Plusvalía (IIVTNU)
The plusvalía municipal is a local tax charged by the town hall, calculated on the increase in the cadastral value of the land over your ownership period.
Following a 2021 Constitutional Court ruling, sellers can now choose between two calculation methods — objective or real gain — and pay whichever is lower. If the property was sold at a loss, no plusvalía is due.