The price listed in the advertisement is not what the seller receives. Two separate taxes are levied on the same transaction, one collected by the municipality and the other by the state, and they are not deductible. On a property purchased for €200,000 and resold for €280,000 ten years later, these taxes together amount to €11,700. Once the selling costs are added, the seller receives €259,350, which is €20,650 less than the price stated in the deed.
How much does it cost to sell a property in Spain?
Between 6% and 10% of the sale price, including taxes and fees, for a standard transaction generating a capital gain. The tax portion depends on the profit realized and the holding period, while the fee portion depends primarily on the agency commission.
The most common misconception is that there is only one tax. There are two, they fall under different administrations, follow different rules, and are paid at different times.
Element | Municipal added value | Capital gains subject to income tax |
|---|---|---|
Spanish name | Municipal Plusvalía, or IIVTNU | Heritage Ganancia in the IRPF |
Who perceives | The municipality where the property is located | The national tax administration |
What is taxed | The increase in the value of the land alone | The total profit on the transaction |
Calculation basis | Two methods for the taxpayer to choose from | Selling price less purchase price, after deduction of fees |
When to pay | Thirty working days after signing | On the next year's tax return |
The two taxes are independent. The municipal capital gains tax is not deductible from the national tax, but it counts as a selling expense and therefore reduces the taxable gain. This is the only link between the two.
Municipal added value and its two methods
Until 2021, this tax was calculated using a fixed formula that resulted in a payment amount even when the seller had lost money. The Constitutional Court invalidated this system in October 2021, and Decree-Law 26/2021 replaced it with two calculation methods.
The taxpayer chooses the more favorable of the two options. The municipality is obligated to apply the one that provides the lower base. And if no actual increase exists, no tax is due, provided this can be proven with both documents.
- The objective method starts with the cadastral value of the land, not the entire property, and applies a coefficient that depends on the number of years of ownership. The municipality then applies its rate, capped at 30%.
- The actual method starts from the effective gain, the difference between the selling price and the purchase price, and only retains the fraction corresponding to the land in the total cadastral value.
A concrete example illustrates the discrepancy. A property purchased for €200,000 and resold for €280,000 after ten years. Total cadastral value of €100,000, of which €40,000 is for the land, representing 40%. Municipal tax rate of 29%.
Method | Taxable base | Tax due |
|---|---|---|
Objective, coefficient of 0.12 over ten years | 40,000 × 0.12 = €4,800 | €1,392 |
Actual, 40% of a gain of €80,000 | 80,000 × 40% = €32,000 | €9,280 |
The seller opted for the objective method and paid €1,392 instead of €9,280. That's a difference of €7,888 for the same property, the same sale, on the same day. Calculating both methods isn't optional; it's the only way to know what you owe.
For the same sale, the difference between the two calculation methods reaches 7,888 euros. Calculating only one of the two is tantamount to paying randomly.
The scale that Congress has twice overturned
The coefficient applied in the objective method decides everything, and it is the subject of a legislative saga that few sellers are aware of.
These coefficients must be updated annually according to a legally binding standard. Due to a lack of state funding, the government proceeded by decree-law, and Congress twice refused to ratify the legislation.
The second episode deserves attention. Decree-Law 16/2025, published on December 24, 2025, raised the tax rates effective January 1, 2026, with increases reaching 40% for holding periods of less than fifteen years. Congress refused to ratify it, and the repeal agreement was published on January 28, 2026. These rates were therefore only applicable from January 1 to 27, 2026. Anyone who sold during this period and liquidated their assets under the new rates overpaid and can request a refund.
The applicable scale remains that of article 24 of decree-law 8/2023. Its form is surprising: it does not progress with the length of detention, it draws a valley.
This curve has a direct practical consequence. Reselling after seven years fetches a higher price than reselling after thirteen, assuming the same cadastral value. And extending the ownership period to twenty years quadruples the coefficient compared to the lowest point. When the sale date is negotiable, it's worth considering.
Capital gains subject to income tax
The second tax is levied on the actual gain from the transaction. It is calculated by subtracting the acquisition value from the transfer value, and it is included in the savings base, which is taxed according to its own progressive scale.
The acquisition value includes the purchase price, purchase taxes, notary and registration fees, and any improvements documented by invoices. The transfer value is the sale price less the agency commission, municipal capital gains tax, and sales expenses. Without invoices, no deduction is allowed.
Gain slice | applicable rate |
|---|---|
Up to €6,000 | 19% |
From €6,000 to €50,000 | 21% |
From €50,000 to €200,000 | 23% |
From €200,000 to €300,000 | 27% |
Over €300,000 | 30% |
The top tax bracket increased from 28% to 30% on January 1, 2025, by Law 7/2024. For gains below €300,000, nothing changed. The tax scale is applied in brackets, like standard income tax: a gain of €60,000 is not taxed at the full 23% rate.
Let's take the same property as an example. Purchase price €200,000, acquisition costs €20,000, making a total acquisition value of €220,000. Sale price €280,000, from which we must deduct €8,400 in agency fees, €1,392 in municipal capital gains tax, €400 for mortgage release, and €150 for the energy performance certificate.
Line | Amount |
|---|---|
Selling price | €280,000 |
Deductible sales expenses | €10,342 |
Transmission value | €269,658 |
Acquisition value | €220,000 |
Taxable income | €49,658 |
Income tax | €10,308 |
Net product for the seller | €259,350 |
Of the listed price of €280,000, the seller receives €259,350. The two taxes amount to €11,700, or 4.2% of the price. Non-tax fees add €8,950. The total amount deducted reaches 7.4% of the sale price.
Improvements increase the acquisition value and therefore reduce taxable income. A kitchen renovation costing €15,000 saves approximately €3,150 in taxes in the 21% tax bracket. Without an invoice in the owner's name, the expense is not recognized by the tax authorities. Routine maintenance and repairs do not count; only improvements are considered.
The three cases where you pay nothing
Three situations provide total exemption from national capital gains tax. They all concern the primary residence, never a secondary residence or a rental property.
Exemption | Condition | Scope |
|---|---|---|
Reinvestment | Buy back a primary residence within two years, before or after the sale | Total if everything is reinvested, proportional otherwise |
Over 65 years old | Selling your usual residence | Total, with no obligation to reinvest |
Payment in kind | To hand over the property to the mortgage lender, without sufficient other assets | Total |
Two points are important to note. The exemption for reinvestment is calculated on the transfer value, not on the capital gain: reinvesting half of the sale proceeds exempts half of the gain. And for those over 65 who sell a property that is not their primary residence, the exemption does not automatically apply, unless the proceeds are converted into a guaranteed life annuity up to a limit of €240,000.
Regarding municipal capital gains tax, the exemption for those over 65 depends on each municipality's tax regulations. Some grant it, others do not. This should be verified with the town hall, not in a national guide.
The non-resident seller
A seller who is not a tax resident of Spain does not declare their income under the standard income tax system, but under the non-resident income tax system. Three rules change.
- The rate is fixed at 19% on the gain, with no progressive scale. It applies equally to residents of the European Union and others, contrary to what many guides state.
- The buyer withholds 3% of the agreed price and pays it to the tax authorities within one month of signing. This withholding is a deposit, not an additional tax.
- The seller then has three months to file their tax return and rectify the situation, which is approximately four months from the date of the sale. If the withholding tax exceeds the tax due, they request a refund of the excess.
The reinvestment exemption remains available to non-residents established in the European Union, Iceland, Norway, or Liechtenstein, provided they purchase a primary residence in that area. Selling at a loss does not exempt you from filing a tax return: it is the tax return that allows you to recover the 3% withholding tax.
How InvestPilot reads it
The exit cost is not discovered on the day of the sale. It is calculated at the time of purchase, because it determines the price at which a resale becomes profitable and the time horizon over which it is most profitable.
Strategy | Concerned | Concrete impact |
|---|---|---|
Primary residence | Partial | Reinvesting in a new primary residence cancels the national tax, provided that the property is repurchased within two years. |
Second home | Yes | No exemption applies. The gain is taxed in full according to the savings scale. |
Long-term rental | Yes | The depreciation deducted each year reduces the acquisition value used and increases the taxable gain accordingly. |
Short-term rental | Yes | Same effect as long-term leasing, with higher carrying costs to absorb. |
Renovation and resale | Yes | The municipal coefficient is at its maximum on short holdings, and the margin is calculated after these two taxes. |
InvestScore incorporates exit fees and taxes into the yield calculation for each property in the catalog, using the applicable municipal tax rate. You see the net proceeds from a resale, not the difference between two listed prices.
This article describes the legal situation as of August 21, 2026, and does not constitute tax advice. Municipal capital gains tax rates are revised annually, and each municipality sets its own rate and bonuses. Before selling, have your situation confirmed by a professional and verify the tax regulations of the municipality in question.