Under Article 9, Paragraph 1 (a) of the Spanish Income Tax Act (Spanish EStG), an individual is considered to have their habitual residence in Spain if they are present in Spain for more than 183 days in a calendar year. They are subject to Spanish tax law, including for German company pensions and other retirement income. However, this also applies in reverse, meaning that if your centre of vital interests is in Germany, all assets and income existing in both states are also taxable.
The essential difference lies in the treatment of wealth tax liability – as a Spanish resident, you are liable for tax on your worldwide income in Spain at the corresponding tax rates. There are also significant differences in inheritance and gift tax law.
RH-Tip: You should definitely fore Your personal tax situation should be reviewed by a competent international tax advisor when purchasing a property, as no general statement can be made about this. We would be happy to put you in touch with one of our international tax law partners. The NIE number is a number for the identification of foreigners (foreign national identification numberThe NIE serves as a tax identification number for foreigners.
This is particularly required for:
- the purchase or sale of a property in Spain (and subsequent registration of ownership in the Spanish Land Registry),
- taking possession of an inheritance (and subsequent entry in the land register),
- Setting up a company (e.g. S.L. or SA),
- Operating a business
Further information can be found in our guide: „NIE Number – The Spanish Tax Identification Number“Both buyers and sellers ask themselves this question at the beginning of the decision-making process.
Fundamentally, it can be said that from a purely legal perspective, contact can be made by many estate agents. The only question is to what extent this is also sensible.
As a prospective buyer, you need a competent, trustworthy, and reliable partner by your side who will advise you with commitment. If you have made the right choice, one broker is usually sufficient, as they have a comprehensive overview of the market.
RH-Tip: An efficient property search tailored to your own individual criteria is significantly more successful and purposeful than numerous viewing tours. Save your time on unnecessary viewings with many agents for the finer things in life. The preliminary contract is usually drawn up in German (where the buyer(s) and/or seller(s) are German speakers) or in English (if requested by the buyer and seller) and in Spanish. The notarial purchase contract is always drawn up in Spanish, as it concerns a property located in Spain.
RH-Tip: At a notary appointment, a German-speaking translator can be booked (for a fee) to translate the contract.In principle, non-residents can also take out a mortgage on properties located in Spain. However, there are some differences in treatment between tax residents in Spain and non-residents, i.e. citizens who are subject to tax in other countries.
Mortgages for foreigners living in Spain, or Spaniards living in another country, differ from ordinary mortgages granted to Spanish citizens resident in Spain. For example, they only allow financing of up to 70% of the purchase price, compared to 80% for Spaniards, they tend to have higher interest rates, and a large number of documents must be provided.
However, this does not mean that bank financing is fundamentally impossible to purchase a property in Spain. One would just need to be aware of these differences.
The differing treatment is due to the bank's direct liability in the event of a potential repayment default.
RH-Tip: By taking out a mortgage when purchasing property kannst du die Wealth tax, reduce inheritance tax and gift tax, as they are considered debts and are deducted from net worth. For this reason, taking out a Mortgage for the purchase of a Property in Spain tax-advantageous Effects.For you, as a buyer or seller, the right choice of estate agent is crucial for the success of the planned transaction that you desire.
Admittedly, the range of estate agents on Mallorca is extensive and, without prior knowledge, it is difficult to make the right choice for you straight away.
You can use the usual criteria when choosing an estate agent, such as their website, reputation, and property listings. A personal recommendation from someone you know would certainly be very helpful in making your choice.
RH-Tip: In addition to all the criteria mentioned above, please also place value on the personal qualifications of the agent and their life experience, not just concerning property in Mallorca. A reliable point of contact is more sensible in the long term for decisions of such importance than a “big” name where you have to deal with changing contacts.
Even an extensive property listing on the website says little about the detailed knowledge of the individual properties. Last but not least, the estate agent should ideally have a good command of your mother tongue.
