REFUNDING OF CAPITAL GAINS TAX
First of all I have to stress the importance to see your fiscal representative before you finalise your sale at the notary. He or she will calculate your actual capital gains tax for you and discuss the paperwork that needs to be presented along with it.
Here a summary of the most important pieces of information regarding this tax:
• Residents declare the said tax in their annual income tax declaration, in the year following the sale
• Non-residents have a deadline of 4 months from the date of sale.
• You will be taxed on the net profit made on the property.
• Expenses that will be taken into consideration are those directly related to the house but not the household and only official invoices will be accepted.
• The most important expenses will be those that you had at the time of purchasing, i.e. VAT, notary and land registry fees,
• And those when selling, i.e. plusvalía (ground rates) and agent’s fees
• Proof of your wealth and income tax payments made as a non-resident.
The tax office will make refunds to a bank account in Spain or abroad. And it usually takes up to a year!