You will probably be gathering more and more information as you prepare to buy a property in Tenerife. We always recommend that you speak to us before you make the plunge so that we can advise you properly.
You may think that you don’t have to worry about future taxes when buying a property but the fact is that if you plan properly before you buy it can save you a lot of many when you come to sell it. By arranging a meeting with your Spanish legal adviser prior to buying they will be able to explain which way is the best for you. You can talk to one in your own country as well but you will probably find that they don’t know much about Spanish tax issues. We can help you organize a meeting prior to your purchase.
You will have to consider who’s name you put the property in so that you can take advantage of the maximum tax benefits. All this will be explained to you when you meet your legal adviser.
When you eventually come to sell your property you will be subject to capital gains tax in your own country of residence. The law states that you should declare all world-wide income in your country of residence. This is your duty and we cannot advise you on what your personal tax levels will be.
If you are classed as a non-resident you will be subject to a tax retention which is currently 3% (Jan 2020) This will be deducted from you on the day of signing and will be paid to the Spanish tax authority on your behalf. You will get an official invoice to prove that this has been done which you should keep for future reference. This will then be deducted from any possible future capital gains you have to pay to the Spanish tax authorities.
As we have mentioned on many occasions, we are not legal or tax advisers and we always recommend that you seek professional advice before you buy or sell.
Download our Tenerife
Buyer’s Guide today!
