For those who want to avoid paying taxes, Spain is not the best country to choose. The taxation system is strict and the percentage varies according to the region. The penal fines are high so do not try to swindle.
Once you have an estate in Spain, you will have to pay several types of taxes:
- IBI tax is paid once a year, in September. It is calculated from the cadastral value of your property multiplied by the interest rate which is set by city administration;
Taxes for garbage collection and recycling. It should be paid quarterly or twice a year. The tax is paid by the property owners who do not rent the property, and by bailors. The tax amount is calculated according to the number of owners;
- Property tax is declared and paid in the current year. Each quarter you need to fill out a separate declaration indicating all revenues.
The Cost of Real Estate in Spain
- In Spain, community facilities include a subscription fee. The accounts for light are sent once a month or twice a month. The minimum rate is around € 8-9 per month.
- You will get accounts for water once per three months and the average price is € 46-50 plus an additional fee for wastewater.
- Residents of apartments also pay for the maintenance of the residential complex such as elevator service, pool cleaning, electricity and water, cleaning of the territory, etc. You should pay once or twice a year. It depends on the established norms in the region.
- Sumptuary tax – as a rule, 0.2 percent is taken from the value of the property at a price of €193,000 and more.
- As for insurance, if the owners of apartments do not have a mortgage, it is not necessary. Elsewise the bank requires a flat insurance.
So the average cost for house possession is around € 80 and € 120 per month. For luxurious apartments, you should pay €100-150 per month. The maintenance of villas costs €150 per month or more depending on the lot, location and house.
If you do not pay the taxes the consequence will be severe. They are connected not only to the estate but also to the residenсe permit number. It means that non-payment can lead to tax debt. The sanctions could be provided and your bank account will be frozen. You will have problems once you decide to become a permanent resident of Spain.