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Be Aware Of The Cost Owning A Property
All property owners in Spain are liable to pay
three separate taxes every year. These taxes are: Annual Real Estate Tax (IBI), Wealth Tax and Property Owner’s Imputed Income Tax. If you are a resident, you are subject to personal income tax (including capital gains tax) and property tax (IBI). If you are non-resident, you are subject to personal income tax (including capital gains tax), property tax, plus an additional non-resident property tax. Personal income tax for non-residents only represents income from the property; income from salary is declared where you are a resident. If the property is for your own use, you must pay a certain percentage of your property; if the property is rented, you declare the amount you have received in rent.
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RESIDENCE PERMIT IN SPAIN - GOLDEN VISA
Foreign real estate buyers or investors can now take advantage of the law approved by the Spanish government (commonly known as "Golden Visa") concerning the granting of residence permits for non-EU citizens who invest 500,000 Euros or more when they invest in real estate in Spain. The law, passed by the Spanish Parliament and signed by the King Don Juan Carlos I, became operational on September 27, 2013. Residence in Spain shall also be granted to direct family and dependents of the buyer, i.e. spouses, children that are underage and parents of non EU citizens who invest € 500,000 or more on a property
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Obtaining Your NIE
Expatriates living in Spain will usually already
have an NIE, as you need one for many
transactions; certainly anything that involves
paying tax. Property buyers arriving from outside Spain, however, will need to get one. NIE stands for número de identificación de extranjero and is essential for buying property, obtaining mortgages and getting utilities connected. It is not complicated to get, but it can take from one day to six weeks. Since you need it to sign the escritura, you will need to apply at an early stage in the buying process, and often the estate agent will help, taking you down to the immigration or tax office and ensuring you have all the correct documentation. Most people apply in person but you can also apply via a Spanish embassy or consulate. How you may apply can vary between regions. To apply in person you go to an immigration office (oficina de extranjeros) within a specially designated police station. You must take the following documents:
• Original and one copy of your current passport. If you provide only one copy, it should be notarized
• Official form filled out.
When you have paid the small fee you will be given a date to come back and collect it (or there is a process for a representative to collect it for you). You will also need the NIE to open a bank account. Money laundering regulations limit how much you can pay in cash and set out the choice of payment methods as part of the sale agreement. Payment will normally be by bank transfer or a cashier’s check, so it is sensible to open a Spanish bank account and transfer funds.
Contact A Realtor
Buying real estate is a complex matter at the
best of times, given that there are so many
factors to consider and no two homes or
transactions are alike. However, with all the unique opportunities and potential pitfalls of the current market, it’s even more important for you to contact a realtor once you’ve definitely decided to buy. In choosing a realtor to guide you through the property search, financing, negotiation and transaction processes, you should consider their local market knowledge, experience and track record.