Selling Property in Spain: Capital Gains Tax, Plusvalía & 3% Retention — 2026 Guide

When selling a Spanish property you face three potential taxes: (1) Capital gains tax (IRPF / IRNR): the gain (sale price minus acquisition cost, adjusted for improvement expenses, notary fees, and agent commissions) is taxed at 19% up to €6,000, 21% from €6,000 to €50,000, 23% from €50,000 to €200,000, 27% above €200,000 (Spanish residents). Non-residents pay 19% flat (EU/EEA) or 19% (non-EU). (2) Plusvalía municipal: a local tax on the increase in cadastral value of the land — paid to the municipality. (3) If non-resident: the buyer withholds 3% of the sale price and pays it to the AEAT on your behalf (Art. 25.2 LIRNR).

Under Art. 25.2 LIRNR, when a non-resident (fiscal) sells a Spanish property, the buyer MUST withhold 3% of the agreed sale price (not the gain) and pay it to the AEAT within 1 month via Model 211. This is not the final tax — it is an advance payment on your capital gains tax. After paying, the seller then files Model 210 within 3 months of the notarial deed to declare the actual gain and reconcile. If the 3% withheld exceeds the tax due (e.g. the property sold at a loss), you can claim a refund from the AEAT. The buyer who fails to withhold becomes personally liable for the amount.

The plusvalía municipal (Impuesto sobre el Incremento de Valor de los Terrenos de Naturaleza Urbana — IIVTNU) is a municipal tax levied on the notional increase in value of the land (not the building) since you bought it. Following the Constitutional Court ruling (STC 182/2021), you now have two calculation options: (1) Objective method: apply official coefficients to the cadastral land value × years owned; (2) Real gain method: apply the municipal rate to the actual gain on the land portion. You choose whichever is lower. If you sell at a loss, you can prove this and pay zero plusvalía. The tax is paid to the Ayuntamiento within 30 business days of the sale.

Yes, several: (1) Main residence exemption for over-65s: if you are 65 or older and the property was your main residence (habitual residence) for at least 3 years, the entire gain is exempt from IRPF (Art. 33.4.b LIRPF). (2) Reinvestment in main residence: if you sell your main residence and reinvest the FULL proceeds in a new main residence within 2 years (before or after), the gain is exempt — proportionally exempt if you reinvest only part (Art. 38 LIRPF). (3) Assets acquired pre-31 December 1994: a transitional reduction coefficient (coeficiente de abatimiento) applies to gains on assets acquired before this date — reduces the taxable amount. Non-residents do not benefit from the main residence exemptions.

The taxable gain = sale price − (acquisition cost + allowable expenses). Deductible acquisition costs: original purchase price, Notary and Land Registry fees at purchase, ITP or VAT/AJD paid at purchase, Stamp Duty (AJD), estate agent commission at purchase, any inheritance or gift tax paid (if the property was inherited). Deductible improvement costs: major improvements and renovations (not repairs or maintenance). At sale: estate agent commission, notary fees for the deed of sale. NOT deductible: mortgage costs, ordinary maintenance/repairs, community fees, IBI tax paid during ownership.

Yes — filing Model 210 is mandatory regardless of whether the 3% retention fully covers or exceeds your liability. The 3% retention is an advance payment, not a final settlement. You must file Model 210 within 3 months of the notarial deed date (fecha de la escritura). In it, you declare the actual gain, calculate the correct tax, and claim a refund if the 3% retained is more than the tax owed (this is common when the gain is small or the property was sold at a loss).