When the seller lives outside Spain, part of the price never reaches them: the buyer pays it to the tax agency. Get it wrong and the property you have just bought answers for the seller's tax bill.
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Spain cannot easily collect tax from a seller who leaves with the proceeds. So the law makes the buyer a collector: 3 % of the agreed price is withheld at completion and paid to the tax agency on form 211 within one month of the sale.
If the buyer does not withhold, the property itself is charged with the payment of whichever is lower: the 3 % or the tax the seller actually owed. The buyer ends up paying an amount that was meant to come out of the seller's money.
The duty applies whether the buyer is resident or not, an individual or a company. It applies to each non-resident seller: if a property is sold by a resident and a non-resident jointly, the 3 % is calculated on the non-resident's share.
A seller who claims to be resident in Spain should prove it with a certificate from the tax agency. Without it, the prudent course is to withhold.
The deed records the price, the amount withheld and the form of payment. The seller receives 97 % of the price.
The return identifies buyer, seller and property, and the 3 % is paid with it.
The seller needs it to file their own return and claim any refund.
There is no retention when the seller is an individual who proves residence in Spain, or in a few specific cases such as certain contributions of property to a company.
We prepare and file form 211 for the buyer, deliver the seller's copy and keep the filed return with the purchase documents. It is a one-off piece of work with a short deadline, best arranged before completion. Buyers who will themselves be non-resident owners then have a yearly return of their own from the date of purchase: see non-resident property owners.
A British couple sell their holiday flat. Both are non-resident. The buyer withholds 3 % of the whole price, with a form identifying each seller.
A Spanish resident and her brother who lives in Argentina sell a flat they inherited. The 3 % applies to the brother's half only. The sister's residence should be evidenced by a certificate from the tax agency.
The seller has lived in Spain for ten years on a foreign passport. Nationality is irrelevant. If the seller provides a current certificate of Spanish tax residence, nothing is withheld. If not, the buyer should withhold.
When in doubt the practical rule is to withhold. A seller who was in fact resident recovers the money through their own return. A buyer who wrongly failed to withhold has no such remedy.
Form 211 is the seller's tax, paid with the seller's money. The buyer's own taxes are separate: transfer tax on a resale, at a rate set by each region, or VAT plus stamp duty on a new build, together with notary and registry fees.
A buyer who is not resident in Spain then becomes a non-resident owner with a yearly return from the date of purchase, even if the property is never let. Many learn this years later, when they sell and are asked for the returns. The first one is due the year after purchase: see non-resident property owners.
Answer a few questions on our accounting platform, Salama Tax. You will see which returns apply to you and the fee before you commit to anything.