Savills - Flipbook - Page 60
Buying on the Costa del Sol: A Tax Map for the
International Investor
Domingo Plazas — PLZ Abogados (Madrid · Marbella · Sotogrande)
Andalusia today offers one of the most competitive real estate tax frameworks in
Europe, and the Costa del Sol —where, according to the Property Registry Statistics
published by the Spanish Association of Land Registrars for the first quarter of 2025,
34.75 % of all property transactions are signed by a foreign buyer— has consolidated its
position as the natural marketplace for the international investor. The map, however,
must be read with precision.
IDENTIFICATION AND TAX REPRESENTATION
Every foreign buyer, whether from within the European Union or beyond, requires a
Spanish foreigner identification number (NIE) to execute the public deed. The obligation
to appoint a tax representative in Spain (Article 10 of the Consolidated Text of the NonResident Income Tax Act —Royal Legislative Decree 5/2004—, as amended by Act
11/2021 of 9 July) no longer applies to residents of the European Union or the European
Economic Area benefiting from mutual assistance. It does apply, however, to British
nationals after Brexit, and to Swiss, US and Gulf nationals, particularly when they own
real estate in Spain and the Tax Authority so requires.
TAX ON THE ACQUISITION
In Andalusia, second-hand residential property is subject to Transfer Tax (ITP) at a flat
rate of 7 % (Articles 41 and 43 of Andalusian Act 5/2021 on Ceded Taxes), reduced to 6
% or 3.5 % in certain cases involving primary residence. New-build property carries VAT
at 10 % plus Stamp Duty (AJD) at 1.2 %. The so-called “100 % tax on non-EU buyers”,
announced by the Spanish Government in January 2025 and formally tabled as Bill
122/000196 (Boletín Oficial de las Cortes Generales, Congress, Series B, no. 229-1, of 30
May 2025), is not law in force: the initiative remains stalled in Congress, having failed
to clear the preliminary admission vote. Its compatibility with Article 63 TFEU —free
M A D R I D
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M A R B E L L A
www.plazasabogados.com
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S O T O G R A N D E
