When buying property in Madrid, foreign buyers must pay several mandatory taxes and legal fees. These depend on the property type (new-build or resale), value, and location — but skipping or miscalculating them can lead to delays or penalties.
At Borderless Lawyers, we handle all tax filings and payment logistics for foreign clients so nothing is missed.
📊 Overview of Property Purchase Costs
| Cost Type | Applies to | Typical Amount |
|---|---|---|
| Property tax (ITP or VAT) | All property purchases | 6–10% of price |
| Notary fee | All transactions | €600 – €1,200 |
| Land Registry fee | All registrations | €400 – €1,000 |
| Legal fees | Foreign buyers (optional but essential) | €1,500 – €4,000 |
| POA & translations | If buying remotely | €200 – €400 (or included) |
| Bank & currency fees | If paying from abroad | Varies (0.5–1.5%) |
🧾 1. Transfer Tax (ITP) – Resale Properties
If you’re buying a used or second-hand property:
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Madrid applies a 6% ITP (Impuesto de Transmisiones Patrimoniales)
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Calculated on the declared purchase price or official value, whichever is higher
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Paid within 30 days of signing the deed
📌 We prepare and file this tax on your behalf to avoid late penalties.
🏗️ 2. VAT and Stamp Duty – New-Build Properties
If you’re buying directly from a developer:
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10% VAT (IVA) on the purchase price
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1.25% Stamp Duty (AJD) in Madrid region
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Paid at the time of notary signing
We confirm the seller’s developer status and handle VAT declarations.
🖋️ 3. Notary & Land Registry Fees
These are regulated based on property value and complexity:
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Notary fees: €600–€1,200
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Land Registry fees: €400–€1,000
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Paid immediately after signing the public deed
We ensure all documentation is accepted and filed correctly.
🧑⚖️ 4. Legal Fees
Hiring a lawyer is not mandatory — but for foreigners, it is critical.
At Borderless Lawyers, our legal services cover:
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NIE, due diligence, arras review, contract drafting
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Tax filing and notary representation
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Remote signing with Power of Attorney
✅ Our legal fee packages are fixed and transparent, starting from €1,500.
🌐 5. Power of Attorney & Translations (If Remote)
If you’re buying without being in Spain:
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POA drafting and notary: €150–€300
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Courier and apostille (your country): €50–€150
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Certified Spanish translations (if required): €50–€100 per document
We handle this entire process and can reuse POA for other property services later.
💳 6. Currency Exchange and Banking Costs
Foreign buyers often incur:
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International wire transfer fees
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Currency conversion losses
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Account setup charges (some Spanish banks)
💡 We work with trusted foreign exchange providers to reduce your costs by up to 70% compared to high-street banks.
📋 Example: €400,000 Resale Property in Madrid
| Cost Type | Estimated Amount (€) |
|---|---|
| ITP (6%) | €24,000 |
| Notary + Registry | €1,500 |
| Legal fees (fixed) | €2,500 |
| POA + courier | €300 |
| Bank & exchange costs | €2,000 |
| Total extra costs | €30,300 |
💬 Final Word
Understanding property taxes and fees is essential to budgeting your Madrid purchase. Don’t leave calculations to agents — work with lawyers who protect your interests.
At Borderless Lawyers, we:
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Handle all tax filings and payments
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Explain your costs upfront in plain language
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Offer all-in-one legal packages for foreign buyers
📞 Contact us today for a detailed quote based on your property type and location in Madrid.