How to buy a house in spain being a foreigner
There are two reasons that brexit is very unlikely to trigger a crash. Firstly, foreign buyers are a diverse group: German, French, Belgian, Italian and Swedish (among many others) are a very active, growing part of the market.
It is also important to note that this non-binding referendum and British politicians will now enter a prolonged period of horse trading over what to do – or even who is in charge.
At the MORAIRA GROUP you will find a great team ready to advise and help you find the home you are looking for. Professionals that from the beginning to listen to you and help you to offer you a home tailored to your needs.
What taxes are paid when buying a house in Spain?
The political party has presented several tax proposals to be included in the future tax reform that would increase the tax collection by some 29,800 million. Among the measures proposed are the creation of new taxes to tax empty homes, foodstuffs of poor nutritional quality and another one aimed at large fortunes that cannot be subsidized by the autonomous regions. It also proposes a surcharge in Societies to the electric companies, to raise the IRPF to the incomes of more than 120,000 euros and to harden the taxation of socimis and sicavs. Read more
Expenses for buying a home in Spain
“The truth is that the Brexit, now coupled with the coronavirus and consequent crisis in both countries, is affecting the real estate sector a lot. Sales are at a standstill as we wait to see what happens in the coming months,” says Lazcano.
This is not only a currency problem, but how are British citizens dealing with it? Well, they are thinking a lot about it because there are still many loose ends to be dealt with: health, pensions, visas, etc. Everything indicates that it is going to be more expensive for them to buy a home from January 2021: probably when applying for a mortgage they will need a higher deposit, as financial institutions will lower the % of financing to 60-65%. European citizens are taxed at 19% on real estate capital yields and in England they will now be taxed at 24% as of January 1, 2021,” points out Barbara.
Can i buy a house in spain after brexit? online
You can find a detailed explanation of all these costs and taxes in this article, but for now keep in mind that the costs associated with the transaction will be the same regardless of your nationality.
This volatility can change your purchasing power and make the existing price of the property higher or lower depending on currency movements (which after Brexit may be even more noticeable).
But now, as a non-EU citizen, that percentage increases. You will have to pay 24% income tax as a non-resident (IRNR) on the income generated; and you will not be able to deduct rental expenses.
This tax is paid quarterly, and we recommend you to contact a tax lawyer to manage the filing of the different forms, thus avoiding that you miss any deadline.
Well, if that is the case, you will continue paying taxes, but this time on the income you would have generated if you had rented, and at a different (higher) percentage than if you were still from the European Union.