Reserve first: The preliminary purchase contract
If you have decided to buy a property in Spain, the first steps to implement the project are the preparation of the preliminary purchase contract and the agreement of a notary appointment. Beforehand, it is necessary to inspect the buyer’s notarial deed of acquisition, called Escritura, as well as the Nota Simple, which is equivalent to the German land register excerpt. If you could find out the existence and correctness of the documents, you have to pay 10% of the purchase price immediately after signing the preliminary purchase contract. The payment made together with the attachment of the preliminary purchase contract to the Nota Simple is equivalent to a binding reservation.
To be on the safe side: We generally recommend consulting an experienced broker as well as a tax advisor right from the start to ensure that you are legally and professionally protected at every step. They will also review the important documents for you and have good contacts with authorities and offices.
So that everything is correct: All information about notary, offices and taxes
To ensure that everything runs smoothly on site, all the necessary documents for notarization should be available before the notary appointment. As a rule, your broker will take care of the timely procurement. At the notary’s office, the focus is then on the contract. All parties involved go through the document together step by step and have the last chance to obtain any changes before signing. Once this has been officially sealed and notarized by the buyer and seller, we move directly to the financial part. The buyer is requested to pay the outstanding purchase amount.
In terms of tax liability, it’s the same everywhere. Taxes are also payable in Spain. Sellers who are not resident in the country must pay 3% of the amount received as Impuesto sobre la Renta no Residentes, a type of capital gains tax directly to the relevant tax office. The buyer also has to pay a real estate transfer tax or value added tax after the official registration of the transfer of ownership by the land registry office, depending on the location and object. In addition, the land registry and the notary receive a total compensation of 1-1.5% of the purchase price for their work. Only when all steps are duly checked off and the transfer of ownership is officially confirmed, the transaction is considered completed.
Also important: Whenever foreigners have to pay taxes in Spain, they need a so-called NIE number. So apply for this early on locally or at the Spanish consulate in Germany. We are happy to support you in all these important steps.
