The seller is responsible for paying the agent’s commission and tax to the municipality on the increase in value (plusvalia) during the period he has owned the property. In addition, the seller must pay the annual municipal property tax (IBI) unless otherwise is agreed with the buyer.
If you are not a tax resident, 3% of the deed value will be withheld and paid to the tax office. If you have sold at a loss and complied with your tax obligations, you can apply to have this refunded. However, if you have made a profit, the capital gains tax in the Valencia region is 19%, and any difference must be paid.
If you are a tax resident over the age of 65 and have lived in the property as your permanent residence for more than three years, different rules apply. We recommend that you contact a professional advisor and tax expert to protect your interests.
If you have a mortgage on your property, check with your bank to find out how much it will cost to pay off the loan and delete it from the property register.
Finally, the seller must present a valid energy certificate (and in some places an updated occupancy certificate is required) before going to the notary to transfer ownership.
So, the seller must pay:
- Real estate agencies fee
- Tax to the municipality
- Capital gains tax
- Cancellation of loans and deletion of encumbrances in the property register (if there is a loan)
- 3% withholding tax if the seller is not a tax resident
- Energy certification
- Valid occupancy certificate (not required everywhere)
Regardless of whether you are selling privately or using a real estate agent, we recommend that you use a lawyer with insight into Spanish property and tax law to protect your interests. The cost is low compared to the price of the property, and it is an insurance to avoid problems after the change of ownership.
