Selling, retention 3% tax for non residents
Why do they retain this 3% of the selling price
In the past, many foreigners have sold their property in Spain, and then gone back to their country without paying the capital gains tax on the profit they have made when selling their property.
So if you are not a tax resident in Spain, you will have retained 3 percent of the selling price, below is the process.
For ease of this example, we put a selling price of €100,000.
When signing the buy and sell contract, as by the law, Art. 1454 of the civil code, you will pay 10 percent of the purchase price, by Spanish law, should you not complete the sale within the maximum date stipulated in the contract, you would lose your deposit, and if the seller should not complete the sale within the maximum date stipulated in the contract, the seller would legally have to pay you back double the amount he or she was paid.
So now €10,000 deposit has been paid, there is €90,000, but for a seller who is not resident, the final payment in the notary will not be the €90,000, but €87,000.
In the notary, the retention of €3,000 euros will be stipluated in the title deeds, and the buyer will have to pay this €3,000 to the tax office, submitting online with the Model 211, printing the documents and going to the bank to pay the money to the tax office by bank transfer. Once this bank transfer has been made, the bank will stamp it to prove payment, and the document will have to be provided to the lawyer or legal advisor of the purchaser, so it can be provided to the land registry to be included.
Can I claim this money back?
You can present a different Model to the tax office online, pay the correct capital gains tax, which is currently 19.5% of the profit made, reducing over time, once this is paid, then you can try and claim back the money retained when you sold the property, we suggest if you do not speak Spanish, nor understand the Spanish tax system, you contact us for a quote to do all the necessary work and paperwork for you.