Property Transfer and Stamp Duty Tax in Spain

Which transactions are subject to the property transfer and stamp duty tax in Spain?

Property transfers, corporate transactions and stamp duties are subject to the property transfer and stamp duty tax (Impuesto de Transmisiones Patrimoniales y Actos Jurí­dicos Documentados – ITP / AJD).

  • Property transfers: this tax must be paid upon the purchase of estate to a private individual, establishing rights in rem (e.g. an usufruct), acquisition of a registered interest in property, etc. The transferee must pay the tax at a rate up to 10 % of the purchasing price, depending on the region where the property is located. In case of purchasing a movable or personal property, rates also depend on the region where the purchase takes place. Tax rates for purchasing used vehicles are 4% to 8% depending where the vehicle is sold. Upon buying a used beware about declaring a value much lower than the approximate market value, the Spanish Tax inspectors could feel that the purchasing price is too low and you may be applied heavy penalties. Your Lawyer can help you with  this matter by seeking the information from the tax office as for what is the market value of the property that you intend to buy.
  • Corporate transactions: Such as setting up a business, business merger, share capital increase or decrease etc;The corporate shall pay this tax, if any, except when increasing or decreasing share capital, in which case the shareholders must pay this tax. Tax rates are different from one Spanish region to another.
  • Stamp duty: The tax shall be paid upon signature of a public deed, of notarial documents, registry office documents;The rate applicable differs from one case to another.

Term of payment

This tax must be paid to the Regional Treasury office of the corresponding Autonomous Community within 30 working days from the date of signature of the relevant deed or contract.

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