Selling property in Spain as a non-resident: taxes and process

The 3% retention: what it is and how it works

When a non-resident sells property in Spain, the buyer is legally obligated to withhold 3% of the total sale price and pay it directly to the Agencia Tributaria (Spanish tax authority) using Form 211. This happens at the notary signing — the buyer pays you 97% and sends 3% to the tax authority.

This retention is not a tax in itself — it is an advance payment on your capital gains tax liability. If your actual tax is less than 3%, you can claim back the difference. If it is more, you must pay the shortfall.

Capital gains tax calculation

Non-residents pay 19% on the capital gain, calculated as:

• •Sale price minus purchase price (including taxes paid at purchase)
• •Minus purchase costs (notary, registry, lawyer, ITP/VAT paid at purchase)
• •Minus improvement costs (documented renovations — not repairs or maintenance)
• •Minus selling costs (estate agent commission, lawyer, energy certificate)
• •= Taxable gain × 19% = Capital gains tax due

Plusvalía municipal

The plusvalía municipal is a local tax on the increase in land value during the time you owned the property. Since Real Decreto-ley 26/2021, which followed Constitutional Court ruling STC 182/2021, it is charged on the lower of two bases: the objective one (cadastral land value × a coefficient for the years owned) or the real gain on the land (sale price minus purchase price, times the land share of the cadastral value).

If you sell at a loss, nothing is due (you must prove the loss with the purchase and sale deeds). For profitable sales, the amount depends on the municipality's coefficients and rate, capped at 30%.

The seller owes this tax, but when the seller is a non-resident individual the law makes the buyer the substitute taxpayer (art. 106.2 of the Local Finances Act): the buyer files and pays it within 30 working days of the sale and deducts the amount from the price.

How to claim back the 3% retention

If your 3% retention exceeds your actual capital gains tax, you can claim the difference back by filing Form 210 within the three months that follow the first month after the sale date. The tax authority has six months to pay the refund; after that it owes you late-payment interest (art. 31 of the General Tax Act).

You will need: the deed of sale (escritura), proof of the original purchase price and costs, receipts for any improvements, and your Form 210 filing. Most non-residents use a gestor fiscal to handle this process.