Owning Property on the Costa de la Luz
Although foreign buyers don't have to become resident in Spain they do have to apply for an NIE (Numero de identification de Extranjero) number through their lawyer.
Apart from insuring one's properties other fees and taxes have to be paid:
IBI Tax
This is a real estate tax (local rates) levied by the local town hall and is usually 0.85% of the catastral (rateable) value.
Property Income Tax
Non resident natural persons owning real estate in Spain for private purposes will be taxed at the rate of 25% of the supposed profit (rental income) produced by the property and this supposed profit is calculated at the rate of 2% of the catastral value.
Property Wealth Tax
This tax is calculated as between .2% and .25% of the highest of the following values:
- The catastral value
- The value estimated by the tax authorities
- The purchase price 'declared' on the title deed.
Community Fees
These are paid to the Community of Owners for services and maintenance of communal areas when the property is located in a development or condominium.
* Offshore Companies owning property in Spain pay a fixed rate of 3% of the catastral value instead of the Property Income and Wealth Taxes
