Capital Gains Tax in Spain is paid on the proceeds from the sale of certain assets in Spain, including antiques, art and jewellery, stocks and shares, properties and businesses.
Capital Gains Tax Exemptions on Property
Residents over the age of 65 are exempt from this tax on the profit obtained from the sale of their primary home, regardless of how long they have owned it.
It is important to highlight that the Spanish Tax Agency defines “a main residence” as the place where you have lived permanently for at least 3 years; Thus, residents under 65 years of age are exempt from CGT on the profit obtained from the sale of their main home, provided that the entire profit is invested in the purchase of another main home in Spain within two years of the sale. .
Any earnings that are not reinvested are subject to CGT at the income tax rate.
Gains disclosed as a result of the death of a taxpayer, donations to government entities, and donations of certain assets in lieu of tax are exempt from CGT.
Capital losses can be offset against capital gains, but not against ordinary income.
Capital losses in excess of earnings may be carried forward to offset future earnings over a period of five years.
Capital Gains Tax Rates
On January 1, 2010, Spain raised its CGT from 18% to 19% on benefits of up to 6,000 euros obtained in a year.
As of June 2010, the tax increase is frozen at 19% for non-resident property sellers, meaning they pay only an additional 1%.
Capital Gains Refunds
The European Court of Justice has ruled that non-resident sellers, since 1997, can claim a refund for any excess CGT they have paid. The European Court of Justice annulled Spain’s claim for a four-year limitation period for claims.
