Spanish Government Seek To Stimulate Real Estate Market With 50% Reduction in Capital Gains Tax
Posted on Jan 22, 2016
In an attempt to stimulate the Spanish real estate market, the Spanish government has now introduced a reduction in capital gains tax (Impuesto Sobre la Plusvalía) which applies to any properties purchased between the 11th May and the 31st December 2012. This is a welcome boost by prospective property investors in Spain and means that any capital gains made on properties purchased between the dates above will receive a 50% exemption of capital gains taxes. The current capital gains tax rates for 2012 are as follows Residents 0-6,000 Euro's - 21% 6,000 - 24,000 Euro's - 25% 24,000 Euro's or more - 27% Non-residents Flat rate of 21% This means that the figures above will be halved for any properties purchased between 11th May and 31st December 2012. So as long as you purchase a property between now and the end of the year, any future sale of that property will warrant a 50% reduction in the rates above. The tax exemption applies not only to residents, but also to non-residents and Spanish companies. It's important to note that the reductions do NOT apply to those where there is a link between the two parties selling. So, if you are selling to a family member, the reduction does not apply. The discount is also only for urban property and NOT rustic/rural property. This is a welcome stimulus measure from the Spanish government. With property prices already at up to 50% lower than in recent years, it is a step in the right direction at encouraging property investors to continue to purchase in Spain. If you are considering purchasing in Spain, please see our property search page here to search through our current range of properties.