Tax payment home or away!

rotrjuj

Does anyone know. we are thinking of selling our property in spain . Do we have to pay tax in Spain and back here when money is bought back over. If we do anyone know what %. Help and info would be appreciated!

Ian_W

You have to pay a "witholding tax" as a purchaser in Spain, I think it may have changed since we sold in 2005 but it was 5% of the purchase price. By that I mean when you do sell your purchaser only pays 95% of the agreed price to you and pays the other 5% at the notaries when the property is signed over to cover, in part at least, your Spanish CGT.

You are then liable to the rest, sorry don't know the current %, but your Spanish lawyer/Estate Agent should advise you of this when you sell.

You then have to complete a CGT return in the UK BUT there is a double taxation treaty which means that Spanish CGT, including the witholding tax is deducted from any UK liability. UK CGT is charged at 18% but you can deduct your buying and selling costs and have a tax free allowance of £10K (each, if jointly owned) so it is quite possible you will owe little or nothing here.

Sorry I'm not up to date with the %ages. I think they were changed because Spain had different rates for Spaniards than Foreign owners which was contrary to EU law.