Selling a property in Tenerife can be a rewarding experience, but understanding the costs involved in the selling process is crucial for a successful transaction. This guide outlines the essential expenses to consider, ensuring you are well-prepared for your sale.
Key Costs When Selling a Property in Tenerife
- Hacienda Retention for Non-Residents – If you’re a non-fiscally resident selling property in Tenerife, you are required to leave 3% of the sale price with the Hacienda, Spain’s tax authority. This retention serves as a withholding tax and helps cover your tax obligations, ensuring compliance with local laws.
- Capital Gains Tax in Tenerife is another significant cost to factor into your budget. This tax applies to the profit you make from selling your property and is calculated based on the difference between your purchase price and the sale price. Be aware of any allowable deductions that may reduce your tax liability, as understanding this can greatly affect your final earnings.
- Plusvalía Tax – In addition to capital gains tax, sellers must also pay the Plusvalía tax, which is a municipal tax reflecting the increase in value of the land your property occupies since you acquired it. The amount can vary significantly depending on the municipality, so check with local authorities for specific calculations relevant to your property.
- Real Estate Agent Commission Fees – Many sellers opt to work with real estate agents to simplify the selling process. Be prepared for a commission fee, typically around 5% of the sale price, including Canary Island VAT. This fee compensates the agent for their expertise in marketing your property and facilitating the transaction.
Budgeting for Your Property Sale
Understanding the total costs of selling property in Tenerife is essential to avoid surprises during the selling process. By accurately budgeting for these expenses, you can ensure a smoother transaction and maximize your profits.
30 questions in 30 days – 3 – How much does it costs to sell a property in Tenerife?
