Tax considerations and other costs for property in Ibiza

In general terms, allow about 10% to 11% extra to cover your tax liabilities and miscellaneous costs. This will cover the Spanish equivalent of VAT, known as IVA, which is calculated at 6% of the value of a pre-owned home or 7% of the value of a new property. It also covers stamp duty, which at present is 0.5%; a small fee that has to be paid to the property registration office; a charge for obtaining copies of the ‘escritura publica’; connections to local utilities and legal fees, which are usually about 1% of the sale value.

You should also be aware that, as the buyer, you may be required to pay the seller’s fees, although this is a point for negotiation.

Additional costs and fees

If you buy from someone who is not an official Spanish resident you will be required to lodge a deposit equal to 5% of the sale price with the Hacienda or local tax office. This system was introduced to offset the risk of the seller leaving the country without settling his bill for capital gains and other taxes and it means that the seller won’t receive the proceeds of the sell until he has discharged his financial liabilities.

Capital gains tax on property

Capital gains tax, or ‘plus valia’ must be paid when the property is sold. It is calculated as 35% of the difference between the present value of the land and it’s value when last sold. Spanish law does not specify who is liable for this tax so it’s very important to include this in your negotiations and to have the agreement documented by a lawyer.

Ibiza Property Sales and Investments

We at Paramount Properties understand that, as part of our commitment to our clients to make the whole process of buying or selling a property in Ibiza as trouble-free as possible, we should be able to provide professional assistance and guidance in respect of all aspects of the home move.

How does it work?

Choosing Paramount Properties to help you sell or let your Ibiza property brings immediate benefit. As one of the leading online London Estate Agents you are guaranteed to have your property presented to an ever expanding pool of prospective buyers.

If you have property that you wish the sell, please contact us. We will respond quickly to set up a convenient time to appraise your property in Ibiza. Once the formalities are complete, you can be sure your property will be given the very highest profile not only on the Internet but also within our property magazine.

We can also, if you wish, help you rent out your property, so you can start earning an income on your investment.