Purchase costs

EU Nationals:
Since Spain became a full member of the EC (now the EU) in January 1, 1986 there is little difficulty for EU nationals in the purchasing of property in any part of it, including the islands. Simply proceed with more caution bearing in mind that you are dealing in a foreign country with its own currency, language and laws. You should follow professional channels at all times. EU, member state, passport holders have effectively the same rights and obligations in Spain and its Islands as they would in their country of origin. Such rights include the right to reside, to take up employment or to open a business.

Others (Non EU citizens):
For non EU nationals there are additional procedures to be complied with which are certainly not too onerous.

Acquisition costs (Freehold): Canary Islands

Additional Costs - to be paid by the purchaser
Fees:

Notario
Registro de Propiedad (Property Registry)
Other legal (solicitor).

Taxes:

Transfer Tax
Plus Valia* (based on increased value of land element since last transaction).

The total of these costs usually comes to approximately 8% of the contract.


Transfer taxes and or VAT on property transactions: Rest of Spain:

Where the vendor is a company and or developer, transfers of building land and first delivery of buildings attract vat at 16% (7% if the building is for housing) plus stamp duty at 0.5%.

Transfers of rustic/undevelopable land and second or subsequent delivery of buildings attract transfer tax (of 6%) or vat. Vat would apply where the purchaser is an entrepreneur or professional (vat regd) and the vendor elects to pay vat rather than transfer tax.

Where the vendor is a private individual and not deemed to be a property developer, transfer tax of 6% is payable regardless of the type of property.

The above paragraphs are merely intended to provide the broad parameters. For more specific or strategic information the usual specialist sources should be explored.

Annual outgoings (residential property) Crude figures:

Non resident, property owners, income tax.
This is based on 25% of 2% [0.5%] of valor catastral (the value determined for fiscal purposes by the Townhall).

Patrimonio (wealth) tax.
This is based on 1/5% [0.2%] of valor catastral, up to about 156.000 Euro Scale thereafter.

IBI (Impuesto sobre Bienes Inmuebles).
Local property tax which varies from district to district.

Community charge or levy.


And:
Power, water, waste disposal, phone and usual household costs. Perhaps if one were to assume about 1.5% of capital value for the above annual outgoings one wouldn't be too far out.