This is a contract in which one person transfers to another the ownership of a good (such as a house, a car, shares, etc.) in exchange for a price in money or in a medium that represents it. When the exchange is not made with money, but with a different good, it is called an exchange.
Documentation for Purchase and Sale:
Deed or title deed.
Receipt of contribution. In its defect the Cadastral Reference of the property will have to be contributed to obtain the notary's office the graphic and cadastral certificate.
Identity documents. If they were companies, the corresponding powers of attorney or the appointment and validity of the representative's position.
All the participants must show the original of the N.I.F. (Tax Identification Number) that coincides with the number of the Spanish D.N.I., or the foreigners the N.I.E. (Foreigner's Identification Number), so that the taxes can be paid and the purchase-sale can be registered in the Land Registry.
Documentation relative to means of payment (in any case dates and form of payments and, if available, documents accrediting the payments or at least indication of the Banks of origin and destination of the funds). That is to say, it must be indicated whether the price was received before or at the time of the deed, or is deferred, as well as the means or means of payment used and the amount of each one of them. The notary must attest in the public deed the checks or supporting documents of the means of payment used, which are exhibited to him by the grantors. If the grantor refuses to identify in whole or in part the means of payment used, the notary must warn, stating it in the public deed, that he will provide the Tax Agency with the information.
To provide form S-1 (it is a declaration to the Bank of Spain that is made in the financial institutions) when payments are made in cash or bearer checks are used for amounts greater than 100,000 Euros. As long as the means of payment are not accredited it will not be possible to be registered in the Registry of the Property (art. 254 Mortgage Law).
If an apartment, premises, or garage of a building under horizontal property regime is transferred, a certificate of the Secretary with the approval of the president regarding the state of the community expenses must be provided, although the deed, being in agreement with the buyer, can be granted without the certificate on the basis of the declarations of the seller.
The “Real Decreto 235/ 2013 de 5 de abril ‘por el que se aprueba el procedimiento básico para la certificación de la eficiencia energética de los edificios’ establishes the obligation to make available to buyers or users of buildings or building units, an energy performance certificate (registered in a special register) which must include objective information on the energy characteristics of the same. They last for ten years. Their lack does not prevent making the deed nor the registration in the Register but could lead to the imposition of penalties to the transferor. Law 8/2013, of June 26, on urban rehabilitation, regeneration and renovation considers serious misconduct punishable by a fine of 601 to 1,000 euros “Selling or renting a property without the seller or lessor delivering the energy efficiency certificate, valid, registered and in force, to the buyer or lessee”. (Disp. Ad. 3ª-4, e). Excluded from the scope of application:
Buildings and monuments officially protected because they are part of a declared environment or by reason of their particular architectural or historical value.
Buildings or parts of buildings used exclusively as places of worship and for religious activities.
Temporary buildings with an expected period of use equal to or less than two years.
Industrial, defense and agricultural buildings or parts thereof, in the part intended for workshops, industrial, defense and agricultural non-residential processes.
Isolated buildings or parts of buildings with a total useful area of less than 50 m2.
Buildings that are purchased for major renovation or demolition.
Buildings or parts of existing residential buildings, whose use is less than four months per year, or for a limited time per year and with an expected energy consumption of less than 25 percent of what would result from its use during the whole year, provided that this is stated in a responsible declaration by the owner of the dwelling.
The Law does not apply to garages and storage rooms and neither to “raw” premises, understanding included in this concept the premises that are not susceptible of qualification, the seller will not be obliged to carry out the energy efficiency certificate. When the premises are fitted out and the corresponding construction and activity project is drawn up, it must contain the energy efficiency certificate, as it is a new construction.
It must be stated to the notary, in order to draft correctly the purchase deed, if there is any matrimonial agreement agreeing a different economic regime to the usual one (capitulations) or you are not married but if you are subject to a registered common-law marriage.
Tax Information:
Buyer:
If the purchase is from a private individual, Transfer Tax (ITPAJD) is accrued, which is payable by the buyer and is settled based on the market value at the initial rate of 8%.
IMPORTANT
The law 11/2021 has meant an important change in this point, establishing that the market value is the reference value established by the cadastre or the one declared in the deed if this is higher than the reference value. Consequently, if the cadastral reference value is higher than the sale value, THE TAX MUST BE SETTLED AT THE REFERENCE VALUE, OTHERWISE IT MAY GIVE RISE TO A TAX INFRINGEMENT. The change is important because before the liquidation by the declared value could give rise to a complementary liquidation but it did not suppose infraction, now yes.
If it is a purchase of a plot of land or first purchase of an urban building from a developer, VAT is payable by the buyer, (since September 1, 2012 10%, for homes or homes with garage, and 21% on premises and plots) in addition to the legal acts tax, at the rate of 1.5%. The buyer pays the VAT to the seller and the seller pays it to the Treasury.
Special case of INVERSION OF LIABLE SUBJECT
The new letters e) and f) of art. 84, 1.2º of Law 37/1992 introduce some cases of inversion of the taxable person (i.e. the vat is paid directly by the buyer who becomes the taxable person, and not by the seller), in the following supplies of real estate:
(1). Made as a consequence of a bankruptcy proceeding (Law 38/2011, of October 10, of reform of Law 22/2003, of July 9, Bankruptcy).
(2). With waiver of the exemption in the cases of sections 20 and 22 of art.20.one of Law 37/1992 (transfer of non-buildable land and second transfers of buildings).
(3). In the execution of a guarantee (the dation in payment of a property).
(4). In execution of works and assignment of personnel for their execution. It can be with or without contribution of materials. The addressee must act as a businessman or professional. Contracts directly formalized between promoter and contractor or between contractor and subcontractor. The object must be the urbanization of land or the construction or rehabilitation of buildings.
(5). In the consideration of work executions, increasing the % of the cost of materials used from 33 to 40% to be considered delivery of goods the work executions that have the purpose of constructing or rehabilitating buildings.
Seller:
In the case of urban real estate (rustic real estate is not taxed for this concept), the transfer is also subject to the municipal tax on the increase in value of urban land (formerly Plus-Valía), which must be paid within 30 days from the signing, the amount varies depending on the Municipality and the dates of acquisition and sale of the property, the City Council will calculate it with a simple copy of the deed. It is regulated in articles 104 and following of the Consolidated Text of the Law regulating local finances. At the moment this increase can be calculated by two ways, or a system attending to the cadastral value or by the real difference between the price of acquisition and sale, in such a way that unlike before if you sell for less than what you bought, there is no capital gain.
If the seller is a foreigner and does not prove his fiscal residence in Spain, the buyer is obliged to withhold and pay to the Tax Authorities 3% of the sale price.
The transferor must also pay, when making the tax return, the tax for the capital gain that he has had with the sale, for the difference between the purchase price and the sale price.