Anyone buying a home in Spain pays, on top of the advertised price, a tax that depends on the autonomous region and on whether the home is new or second-hand, plus notary and Land Registry costs. A buyer living abroad also needs a foreigner identity number in order to sign and, if the home costs more than 500,000 euros, the transaction is declared to the Investment Registry. The much-discussed 100 % tax on buyers not resident in the European Union is not in force.
Second-hand homes: transfer tax
Most of the gap between the price and what you finally pay is tax. Buying a second-hand home attracts Transfer Tax (Impuesto sobre Transmisiones Patrimoniales), a tax assigned to the autonomous regions: each one sets its own rate, so the same transaction can cost different amounts depending on where the property is.
In the Community of Madrid, the general rate for the transfer of property is 6 % (in force as at September 2026). In other regions the rate may differ, and it is worth checking the rate in force in the particular region before running the numbers, because regional rates are revised frequently.
One detail that surprises many buyers living abroad: the tax belongs to the autonomous region where the property is located, not the region where the buyer lives.
New homes: VAT and stamp duty
If you buy a first-transfer home directly from the developer, the tax position is different. There is no Transfer Tax: the transaction is subject to Value Added Tax at the reduced rate of 10 %, paid together with the price. To that is added Stamp Duty (Impuesto sobre Actos Jurídicos Documentados) on the public deed.
In the Community of Madrid, where the buyer is an individual, the stamp duty rate on the deed of purchase of a home depends on its real value (as at September 2026):
- 0.4 % where the value is 120,000 euros or less;
- 0.5 % where it is above 120,000 and no more than 180,000 euros;
- 0.75 % where it exceeds 180,000 euros.
Comparing two listings (one new build, one second-hand) is not a matter of looking at the price: you have to add each one's own tax burden.
The costs outside the tax
Alongside the tax come other items that do not appear in the listing:
- Notary fees, for executing the public deed of sale.
- Land Registry fees, for registration, without which the purchase does not produce all its effects against third parties.
- Fees of whoever files the tax returns and the registration, if you decide to have that part handled for you.
- Valuation of the property, where the purchase is financed with a mortgage.
The foreigner identity number, before signing
In deeds by which property is acquired, those appearing must provide the notary with their tax identification number and that of any person they represent, and the number is recorded in the deed. For a foreign individual, the tax identification number is their foreigner identity number (NIE). Without it the purchase cannot be registered at the Land Registry, and in practice the notary will ask for it before signing. Obtaining it has its own timetable: if you are abroad when you apply, the request is processed through the Spanish consular offices.
Signing without travelling: the power of attorney
Being in Spain on the day of signing is not essential. A power of attorney granted before a notary abroad can be used in Spain with the apostille of the 1961 Hague Convention, where the country of origin is a party to it, without consular legalisation. Where it is drafted in Spanish, no sworn translation is needed. It should describe precisely the powers granted for the specific transaction. Bear in mind that, even if an attorney signs on your behalf, the buyer's NIE is still required.
Payment: how it appears in the deed
In deeds of sale of property, the notary identifies the means of payment used: whether the price was received before or at the time of signing, the amount, and whether it was paid in cash, by cheque or by bank transfer. It is worth planning well in advance how the money will arrive from abroad, because it will be documented in the deed.
If the home costs more than 500,000 euros: form D-2A
The acquisition of property located in Spain by non-residents is a declarable foreign investment where the amount exceeds 500,000 euros. It is declared to the Investment Registry on form D-2A, within a maximum of one month from the date the transaction takes place, which is the date of execution before a notary where one is involved. If the purchase is executed before a Spanish notary, the party obliged to file the declaration is the notary. According to the official guidance of the Ministry of Economy, the threshold applies to each property separately and not to the total of what has been bought.
The 100 % tax is not in force
In January 2025 a levy of up to 100 % on purchases of property by non-residents of the European Union was announced, and in May of that year the initiative was tabled in Parliament. As at 31 August 2026, the date of our last check, it had not been debated or voted on: it is not law in force. It is worth not taking decisions about your assets on the basis of a text that is not yet law, nor ruling them out because of it.
Common mistakes
- Budgeting on the advertised price alone. Tax and the notary and registry costs are added to the price.
- Applying the rate of the region where you live. What governs is the region where the property is.
- Leaving the NIE until last. Without it the deed is not registered, even if an attorney signs.
- Adding up several purchases for the 500,000 euro threshold. According to the official guidance, each property is looked at separately.
Sources
- Legislative Decree 1/2010, of 21 October, of the Community of Madrid, consolidated text on taxes assigned by the State, articles 28 and 32 (consolidated text, consulted in September 2026)
- Law 22/2009, of 18 December, on the financing of the autonomous regions, article 33 (consolidated text from the BOE, consulted in September 2026)
- Law 37/1992, of 28 December, on Value Added Tax, article 91.one.1.7 (consolidated text from the BOE, consulted in September 2026)
- Notaries Act of 28 May 1862, articles 23 and 24 (consolidated text from the BOE, consulted in September 2026)
- Royal Decree 1065/2007, of 27 July, article 20 (consolidated text from the BOE, consulted in September 2026)
- Royal Decree 1155/2024, of 19 November, Immigration Regulations, article 205 (consolidated text from the BOE, consulted in September 2026)
- Hague Convention of 5 October 1961 Abolishing the Requirement of Legalisation for Foreign Public Documents
- Royal Decree 571/2023, of 4 July, on foreign investment, article 4.h) (consolidated text from the BOE, consulted in September 2026)
- Order ECM/57/2024, article 14 (consolidated text from the BOE, consulted in September 2026)
- Ministry of Economy, Trade and Enterprise, Explanatory guide to the foreign investment declaration regime (February 2024)
- Mortgage Act, article 254 (consolidated text from the BOE, consulted in September 2026)