Non-standard taxes faced when moving to Spain
When choosing a new place of residence, a thorough study of the law of a new country is an important stage along with the study of the language and local traditions. Each state has its own specific requirements for paying taxes and their amounts. What are the features of taxation with the purchase of apartments in Madrid – we will try to explore the topic in this article.
VAT in Spain for entrepreneurs
VAT in Spain is fixed at 21 %, but there are certain categories that are not subject to this tax, for example:
• Medical services
• Educational services
• Financial transactions and insurance
Corporate income tax is a duty that is levied at a rate of 25 %. This tax should be paid annually.
Also, the country provides for taxes with floating rate, the amount of which depends on several factors:
• The variety of service or product provided;
• Place – region, city;
• Entrepreneur status, that is residency in Spain or another country.
Due to the fact that each region sets its own requirements, the emergent Spanish entrepreneurs are recommended to recruit the help of a financial advisor when starting a business. A competent lawyer will tell you exactly what expenses are in prospect and what their amount is.
The non-standard taxes relatable to real property
In addition to the fact that when buying an apartment, a duty is paid on the transfer of ownership, the buyer of Spanish housing needs to be prepared for the special taxes adopted in the Kingdom.
The IBI Municipal tax is a floating rate tax. The main factor in its calculation is the cadastral price of the property, which, as a rule, is significantly underestimated comparing with the market price. The coefficient of cadastral price renewal is applied as well, which varies with the year of this cadastral value acceptance. Each province in Spain sets its own value, so a rate of 0.4 to 1.1 percent of the tax base can be applied to urban properties.
Also in Spain you will have to pay the state for the luxury of housing, but only if the taxation base of the income tax is more than 700 thousand euros. The tax percentage varies as well and, depending on the value of the property, ranges from 0.2% to 2.5%. The more expensive a luxury home is, the higher the rate. So, for a house worth more than 10.7 million euros, the tax will be a maximum of 2.5 %.
The Comunidad quota is another Spanish tax that is paid for the maintenance of common areas and for repairs. This is how residents maintain cleanliness and order at home. The cost of this payment is always different. In Barcelona, the quota ranges from 40 to 350 euros per month, depending on the prestige of the property.
Get assistance in selection of housing in Spain
To familiarize yourself with all the legal requirements before purchase of a housing, we recommend you to contact the specialists of the Spain-Real.Estate. Professional realtors will advise you, tell you about all the intricacies of real property registration and maintenance, help with the selection of housing. The company renders assistance in transactions, performs all reviews, offers legal support.
Start searching for housing in Spain now – get one step closer to your dream!