According to Art. 9 no. 1 a of the Spanish Income Tax Act (EStG), a person has his or her habitual residence (residencia habitual) in Spain if he or she stays in Spain for more than 183 days of a calendar year (aňo natural).
They are subject to Spanish tax law, also for German company pensions and other retirement income. However, this also applies vice versa, so that if your center of life is in Germany, all assets and income existing in both countries are also taxable.
The main difference is in the treatment of wealth tax liability – as a Spanish resident, you are liable to tax your world income in Spain at the appropriate tax rates. There are also significant differences in inheritance and gift tax laws.
MD-Tip: You should definitely have your personal tax situation checked by a competent international tax advisor before buying a property, as it is not possible to make a general statement in this regard. We will be happy to put you in touch with one of our partners for international tax law.
Die NIE-Nummer ist eine Nummer zur Identifizierung von Ausländern (número de identificación para extranjeros). Die NIE dient als Steuernummer für Ausländer.
Diese wird insbesondere benötigt bei:
- der Erwerb oder Verkauf einer Immobilie in Spanien (und anschließende Eintragung des Eigentums im spanischen Grundbuch),
- den Antritt einer Erbschaft (und anschließende Eintragung im Grundbuch),
- Gründung einer Gesellschaft (z.B. S.L. oder SA),
- Betreiben eines Gewerbes
The main ancillary purchase costs are:
the real estate transfer tax (see in detail under Real Estate/Tax on the purchase of real estate)
Value-added tax – this is an alternative to the land transfer tax and applies to new properties for first-time occupancy or to plots of land
Notarization tax or the so-called stamp duty (see Information/Tax on the Acquisition of Real Estate)
In addition, costs must also be calculated for the following expenses:
Notary
Registration in the land register
Gestoria (regulates the communication with the land registry and the bank)
Lawyer
MD-Tip: There is no obligation to use the services of a lawyer. Also, a notarial certification with the real estate acquisition is not compellingly necessary in Spain. However, in order for the purchase to proceed smoothly and with legal security, it is advisable to call in the necessary support on the consultant side. We will be happy to put you in touch with our long-standing partner and lawyer for real estate law.
A specialist lawyer for real estate law is not mandatory in Spain. However, the advice is highly recommended, both for the review of all necessary property documents as well as for the review of the purchase contract.
MD-Tip: We have an absolutely recommendable specialist lawyer for real estate law with whom we have been working for many years and who can advise you in German, English, Spanish and French.
Mallorca captivates island-wide with desirable residential areas. Especially popular with foreign investors is the southwest of the island, as the proximity to Palma is seen as an investment safe.
The area Son Vida as the Beverly Hills of Mallorca is located above Palma Bay and has direct 3 golf courses in the area.
Bendinat is exposed near Palma in the southwest of the island and offers many advantages due to its proximity to the sea and the Royal Golf Course.
Costa den Blanes is with the noble port Puerto Portals as well as the 24 hours security service likewise a desired and exclusive villa area.
Furthermore, Camp del Mar and Port d’Andratx with their dream bays and unique sunsets are among the most sought-after exclusive areas for international guests.
MD-Tip: Have a look at some regions on Mallorca before you make your purchase decision because all of them differ in terms of beach proximity, proximity to Palma, sea view, sunsets and neighborhood. We will be happy to advise you on this.
This question is asked by both buyers and sellers at the beginning of the decision-making process.
In principle, it can be said that, from a purely legal point of view, it is possible to contact many brokers. The only question is to what extent this also makes sense.
As a prospective buyer, you need a competent, trustworthy and reliable partner at your side who will give you committed advice. If you have made the right choice, a real estate agent is usually sufficient, since he has a detailed market overview.
MD-Tip: An efficient real estate search adapted to your own individual criteria is much more successful and goal-oriented than numerous inspection tours. Save your time with unnecessary viewings with many brokers for the beautiful things in life.
The preliminary contract is usually drawn up in German (if the buyers and/or sellers are German-speaking) or in English (if this is desired by the buyer and seller) and in Spanish. The notarial purchase contract is always drawn up in Spanish since the property is located in Spain.
MD-Tip: At the notary appointment you can order a German speaking translator (for a fee) to translate the contract.
In principle, non-residents in Spain can also register a mortgage, on real estate located in Spain. However, there are some differences in the treatment between tax residents in Spain and non-residents, i.e. citizens who are taxable in other countries.
Mortgages for foreigners living in Spain or Spaniards living in another country differ in terms of ordinary mortgages granted to Spanish citizens residing in Spain. For example, they only allow financing up to 70% of the purchase price, compared to 80% for Spaniards, they tend to have higher interest rates and a lot of documentation must be provided.
However, this does not mean that bank financing is generally not possible to buy a property in Spain. One would just have to be aware of these differences.
The difference in treatment is due to the bank’s pass-through liability in the event of a possible repayment default.
MD-Tip: By taking out a mortgage when purchasing real estate, you can reduce the wealth tax, inheritance tax and gift tax, since they are considered debts and are deducted from the net assets. For this reason, taking out a mortgage to buy a property in Spain has positive effects from a tax point of view.
This is mainly because it is more difficult for Spanish banks to apply concrete measures to recover the loan in the event of default. If the borrower’s tax residence is outside Spain, the bank has fewer means at its disposal to take action against the borrower in the event of default. The path is more protracted and risky for the banks.
Mortgages for foreigners are usually about 70% maximum of the purchase price (for ordinary mortgages this amount is usually about 80%).
This means that you need to contribute at least 40% of the total price as equity to be able to finance the purchase of a property in Spain with a mortgage (30-40% of the purchase price plus 10% for incidental purchase costs).
In Germany, the suitability (for example, the registration and conveyance of the property) and the transfer of the property take place at two different times. This separation of the transfer of ownership and handover of the property does not exist in Spanish law. At the notary appointment, the new owner is registered in the land register with the full payment of the purchase price and the signing of the purchase contract, and the handover of the property usually takes place after the appointment.
Non-residents of Spain have an annual allowance of 700,000 euros. For this reason, in the case of high-priced real estate, it is recommended that the purchase be made by more than one person (for example, both spouses, since each has an allowance of 700,000 euros).