Property Services & Advice - Property Taxes

Property Taxes

Your accountant, lawyer or "gestor" is your best bet when it comes to working out the best approach to your property taxes. As a source of general information, however, these are the taxes you can expect to pay on your Spanish property:

 

IBI

The IBI is the "Impuesto sobre Bienes Inmuebles", which could be translated as "property tax". This is a municipally levied tax and varies widely from one municipality to another and from one type of property to another. You might for instance, pay as little as 50 euros per year for a simple property in a rural area. While a luxury home on a prime lot in an expensive urban neighbourhood might cost as much as 1,500 to 2,000 year.

 

If you are not in Spain during much of the year, it is best to arrange a standing order at the bank in order to pay this tax. If you do live here, however, you might get a discount by going in person to make an early payment. In any case, don't wait until the town hall chooses to notify you of the tax as, by then, you might owe late fees.

 

Impuesto Extraordinario sobre el Patrimonio

This is a tax on all of your assets and includes your property. There is a difference between residents and non-residents, however, in that residents are expected to declare their world-wide assets, while non-residents are only required to declare the property and other assets they own within Spanish territory.

 

Check with your professional advisor to see if you are exempt from this tax as it is only charged on assets totaling more than approximately 100,000 euros (per person in the case of a couple).

 

Special Consideration for Non-Resident Property Owners

As a non-resident property owner you must be aware of two things. First, you need to obtain an official identification number that will allow you to pay taxes. This is called an N.I.E. and is available by filling out a form at your local National Police commissary.

 

Secondly, if you own more than one property, you are required by Spanish law to appoint someone to represent you in a financial capacity. This can be any official resident, whether native or foreign. Many people choose to have their lawyer do this for them. Not having a representative can result in heavy fines.

"Gestor" is the Spanish term for a person who basically makes your life easier by taking care of all kinds of paperwork and transactions. These are people who are very good at manoeuvring the system, and they can save you loads of frustration in every area of your life. Some "gestors" specialise in accounting, others in law. Some form agencies employ people with a variety of specialties, all of whom work together to resolve clients' problems.

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