11 October 2017

Taxes Payable on Property Transfers in Asturias

Most people from northern Europe don't consider this area of Spain mainly due to it's climate reminding them too much of home! Of course the fact that it has such a climate means that it has a beautiful landscape with dramatic mountain scenery and rolling green hills that are finished off with a fantastically intricate coastline full of dramatic cliffs.
Of course all of this makes it a favourite destination of the Spanish at holiday time and even the preference for a permanent home for nationals of other European countries. So, if you decide to purchase a home in the Principalidad de Asturias, what taxes might you expect to have to pay?
Well, the first step is to determine whether the property is new or second-hand. If the property is new then the tax payable is IVA (VAT) and is set at 8%. This is however being resuced by the state government to 4% until the end of 2011.
As in all other Autonomous Communities, the responsibility for setting property sales taxes on second-hand properties resides with the regional government of Asturias in Oviedo. In this way the regional government is able to promote those activities it considers beneficial and important by making tax incentives to encourage them. The main laws relating to taxes payable on property transfers are contained in Ley 15/2002 (as amended).
In Asturias the tax payable on property transfers depends on the value of the property, as follows:
The above rates apply to most typical property transfers. However there is an exception where the property which is being transferred is a property that is classified as 'social housing' i.e. built using public subsidies and therefore sold at a specially low price with sell-on restrictions. In this case a lower rate of 3% property tax applies when it is the second or subsequent transfer of the property.
The only other fiscal measure of note relating to property is a reduced rate of 3% for second and subsequent transfers of properties sold to real estate companies who then rent that property out as a primary residence.