What are the total costs for foreign buyers purchasing property in Spain?
As a foreign buyer of a new-build in Spain, you typically pay 10 percent VAT, 1.5 percent AJD stamp duty, plus legal fees of around 1 to 1.5 percent and other expenses including NIE, notary and registry fees. Total purchase costs are typically 12 to 14 percent on top of the property price.
- 1New-build properties attract 10 percent VAT plus 1.5 percent AJD stamp duty
- 2Legal fees are typically 1 to 1.5 percent of the purchase price
- 3Notary and registry fees add around 1,000 to 2,500 euros
- 4NIE application costs are minimal, typically under 20 euros in official fees
- 5Total purchase oncost is typically 12 to 14 percent of the price on a new build
Key Takeaways
- 10 percent VAT applies to new-build and off-plan property purchases
- 1.5 percent AJD stamp duty is also payable on new builds
- Legal fees typically range from 1 to 1.5 percent of the purchase price
- Notary and land registry fees add approximately 1,500 to 2,500 euros total
- No additional taxes are charged specifically because you are a foreign buyer
Foreign buyers in Spain face the same purchase costs as Spanish buyers, plus a few additional steps. For a new-build property, the main taxes are 10 percent VAT (IVA) and 1.5 percent stamp duty (AJD), which are paid at completion. Legal fees for a Spanish conveyancer typically run at 1 to 1.5 percent of the purchase price. Other costs include the notary fee, land registry fee, NIE application, and if using a mortgage, an arrangement fee and valuation. There are no additional taxes or surcharges specifically for being a foreigner. The total oncost on a new-build is typically 12 to 14 percent of the purchase price.
VAT (IVA) on new-build property
All new-build and off-plan residential properties in Spain attract VAT (IVA) at a rate of 10 percent of the purchase price. This is a tax paid to the developer at completion, not a separate payment to the tax authority. It is included in the completion payment. On a 400,000 euro property, VAT amounts to 40,000 euros.
AJD stamp duty
The Impuesto de Actos Juridicos Documentados (AJD) is a stamp duty on the notarial document recording the purchase. The rate varies slightly by region; in Andalusia, where most Costa del Sol properties are located, it is 1.5 percent of the purchase price. On a 400,000 euro property, this adds 6,000 euros.
Legal fees
Hiring an independent Spanish property lawyer is essential. Legal fees for a straightforward purchase are typically 1 to 1.5 percent of the purchase price plus VAT. On a 400,000 euro property, this is 4,000 to 6,000 euros plus 21 percent VAT. Some lawyers charge a fixed fee; always agree the fee structure upfront in a written engagement letter.
Notary and land registry fees
The Spanish notary charges a fee for certifying the title deed, and the land registry charges a fee to register it. Together these typically add 1,500 to 2,500 euros on a purchase in this price range. These are fixed-scale fees set by regulation.
NIE number and power of attorney costs
The NIE application itself has a minimal official fee of around 10 to 20 euros. If your lawyer handles it with a power of attorney, their fees for this service are typically 150 to 300 euros. If you grant a notarial power of attorney in Spain, the notary fee is around 100 to 200 euros.
Mortgage costs if applicable
If you take a Spanish mortgage, additional costs include a valuation fee (around 300 to 600 euros), and potentially a mortgage arrangement fee of 0.5 to 1 percent of the loan amount, though many lenders have moved to fee-free structures. The AJD on the mortgage deed was moved from buyer to lender responsibility in 2018, so this is no longer a buyer cost.
Total budget summary
On a 400,000 euro new-build purchase, a realistic total cost breakdown is: VAT 40,000 euros, AJD 6,000 euros, legal fees 5,000 euros, notary and registry 2,000 euros, miscellaneous 1,000 euros. Total oncost: approximately 54,000 euros, which is 13.5 percent of the price. Budget 12 to 14 percent on top of the property price to be safe.
Why This Matters in Costa del Sol
The Costa del Sol is among the most transparent and buyer-friendly markets in Spain for international purchasers. Costs are predictable and specialist lawyers are experienced in managing the process for non-resident clients.
Common Mistakes to Avoid
A German buyer purchases an off-plan apartment in Marbella for 380,000 euros. At completion they pay: 38,000 VAT, 5,700 AJD, 5,000 legal fees, 1,800 notary and registry. Total oncost: 50,500 euros (13.3 percent). Total spend including property price: 430,500 euros.
Legal Note: All costs must be paid in full on completion day. Tax returns for VAT and AJD are filed by your lawyer within 30 days of completion using the funds you provide.
Off-plan property refers to a residential or commercial property that is purchased before construction is complete. The buyer agrees to purchase based on architectural plans, CGIs, show apartments and a specification document rather than a completed building. Payment is typically made in stages tied to construction milestones.
A nota simple is an official summary document from the Spanish Land Registry (Registro de la Propiedad) that shows the current ownership details of a property, any mortgages or charges secured against it, any restrictions on the title, and the cadastral reference. It is the most important due diligence document for any property purchase in Spain.
The title deed (escritura publica de compraventa) is the notarised legal document that transfers ownership of a Spanish property from the seller (or developer) to the buyer. It is signed in the presence of a Spanish notary on completion day, records the purchase price and all relevant details, and is then registered at the Land Registry to formally establish the buyer as the legal owner.
Community fees (cuota de comunidad) are regular charges paid by all property owners within a residential development or building to cover the maintenance and operation of shared facilities and common areas. These include the maintenance of gardens, pools, lifts, security, cleaning of common areas, building insurance, and the management company fees. Community fees in Costa del Sol typically range from 100 to 500 euros per month depending on the level of facilities.
AJD (Actos Juridicos Documentados) is a Spanish stamp duty that applies to transactions documented in a public deed before a notary, including new build property purchases. In Andalusia (which covers the Costa del Sol) the AJD rate is currently 1.5% of the purchase price. It is paid on completion day alongside VAT. AJD applies to new build purchases; resale properties pay Transfer Tax (ITP) instead.
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