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)
• •Plus 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. It is calculated by the town hall based on the cadastral land value and the number of years of ownership.

Since a 2021 Constitutional Court ruling, you do not pay plusvalía if you sell at a loss (you must prove the loss with purchase and sale deeds). For profitable sales, the amount depends on local rates and is typically €500-€5,000 for standard residential properties.

The seller is responsible for paying this tax within 30 days of the sale.

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 3 months of the sale date. The tax authority typically processes refunds within 3-6 months.

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.