Madrid offers excellent opportunities for international buyers, but understanding property taxes and legal fees is essential to avoid surprises.
Here’s a breakdown of what you’ll pay — and how we help you navigate every step.
💰 1. Transfer Tax (ITP) – Resale Properties
If you’re buying a second-hand property (from a private individual), you’ll pay:
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Transfer Tax (ITP): 6% of the purchase price (flat rate in Madrid)
💡 Some regions in Spain have higher ITP rates — Madrid is relatively favorable.
🆕 2. VAT (IVA) & Stamp Duty (AJD) – New Builds
If you’re buying a newly built property from a developer:
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VAT (IVA): 10% of the purchase price
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Stamp Duty (AJD): 0.75% in Madrid (on notarized deed)
đź“Ś These apply to first-time sales only, including some new developments.
🧾 3. Notary & Registry Fees
These are public administrative costs required to finalize the transaction:
| Fee Type | Estimated Range |
|---|---|
| Notary Fees | €600–€1,200 |
| Land Registry Fee | €400–€800 |
| Deed Preparation | €200–€400 |
The exact amount depends on the property value and complexity.
🏛️ 4. PlusvalĂa Municipal (Capital Gains Tax)
A local tax paid to the Madrid municipality based on the increase in land value since the last sale.
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Usually paid by the seller, but can be negotiated
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Buyer must ensure it’s paid to avoid future liability
đź“Ś We include PlusvalĂa terms in the arras contract to protect you.
đź’Ľ 5. Legal Fees (Property Lawyer)
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Standard fee: 0.75% to 1.5% of the property price
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Often capped with a fixed minimum
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Covers: due diligence, POA, contracts, notary, registration
📌 We offer fixed-fee packages for foreign buyers — with no hidden costs.
đź“… 6. Annual Property Taxes After Purchase
Once you own the property, you’ll also pay:
IBI (Impuesto sobre Bienes Inmuebles)
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Annual municipal property tax
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Based on cadastral value
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Usually ranges €300–€1,500/year
IRNR (Non-Resident Income Tax)
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Applies even if the property is vacant
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Based on imputed rental value
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Typically 0.48%–0.75% of cadastral value
đź“Ś We help you file annual tax returns for Madrid property owners.
đź’ł 7. Other Possible Costs
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Mortgage set-up or notary costs (if applicable)
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Bank transfer fees
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Currency exchange fees
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Property insurance (optional but recommended)
📊 Example: Costs for a €400,000 Resale Flat in Madrid
| Category | Estimated Amount |
|---|---|
| Transfer Tax (6%) | €24,000 |
| Notary + Registry Fees | €1,500 |
| Lawyer Fees (1%) | €4,000 |
| PlusvalĂa (negotiable) | €0–€2,500 |
| Total (approx.) | €29,500–€32,000 |
đź“Ś We provide a personalized cost estimate before you sign any deposit.
🧑‍⚖️ Why Work With a Property Lawyer?
✔️ Avoid tax penalties or double-payment
✔️ Get cost transparency from day one
✔️ Ensure correct filings and on-time payment
✔️ Plan for resale or rental tax implications
✔️ Peace of mind with bilingual legal support
đź“ž Want a Full Madrid Property Tax Breakdown?
We’ll explain your total cost of purchase and handle all filings, deadlines, and legal paperwork — so you can focus on your move or investment.