When you sell a property in Spain and you are not a Spanish tax resident, two things happen that surprise a lot of owners. First, you pay Spanish capital gains tax on the profit, even though you live abroad. Second, the buyer holds back 3% of your sale price and sends it straight to the tax office before you ever see it. This guide explains how the tax is calculated, what that 3% is really for, and the deadlines that decide whether you get money back or owe more.
The headline: 19% on your gain
Capital gains made by non-residents on the sale of a Spanish property are taxed at a flat 19%. There are no bands and no progressive scale: the same 19% applies whether your profit is 10,000 euros or 500,000 euros.
Here is the point that trips up most British sellers. Since Brexit, UK residents are treated as non-EU taxpayers, and the general non-resident rate for things like rental income is 24%. But that 24% does not apply to the capital gain on selling a property. Gains from the sale of assets are taxed at 19% for all non-residents, EU or not. So if you have read that you will pay 24% on the sale, that is the rate for other income, not for your capital gain.
The 19% is charged on your net gain, not on the sale price. That distinction is worth real money, and it is where good advice pays for itself.
How the gain is actually calculated
Your taxable gain is the difference between what the property is worth on transfer and what it cost you to acquire, after allowable adjustments:
Transfer value: the sale price, minus the costs of selling, such as estate agent commission and the legal costs of the sale.
Acquisition value: the original purchase price, plus the costs you paid when you bought, such as transfer tax or VAT, notary and Land Registry fees and legal fees (if applicable), plus the cost of documented structural work to the property. Note that ordinary maintenance and repairs do not count.
The gain is the transfer value minus the acquisition value. Keeping every invoice from your original purchase and from any improvement works can reduce the gain significantly, which is why sellers who kept good records usually pay less.
A worked example
Imagine a non-resident who:
- Bought for 200,000 euros, with 20,000 euros of purchase costs (transfer tax, notary, registry, legal), giving an acquisition value of 220,000 euros.
- Sells for 300,000 euros, with 10,000 euros of selling costs (agent commission and legal), giving a transfer value of 290,000 euros.
The net gain is 290,000 minus 220,000, which is 70,000 euros. Capital gains tax at 19% on that gain is 13,300 euros.
Now compare that to the 3% the buyer withholds.
The 3% retention explained
When a non-resident sells, Spanish law requires the buyer to withhold 3% of the agreed sale price and pay it directly to the tax office (Agencia Tributaria) using Form 211, normally within one month of completion. This is not an extra tax. It is an advance payment against your final capital gains bill, and it exists so the tax office is not chasing a seller who has already left the country.
In our example, 3% of the 300,000 euro sale price is 9,000 euros. The final tax was 13,300 euros, so this seller would owe an additional 4,300 euros when they settle up.
It often works the other way too. If your final tax is lower than the 3% withheld, or if you sold at a loss, you are owed a refund of the difference. Either way, the 3% is only a payment on account; your real liability is settled on the return.
Settling up: Modelo 210 and the deadlines
The non-resident seller settles the position by filing Modelo 210, the non-resident income tax return. You have roughly four months from the sale to file it: either to pay any balance still owed, or to claim back the part of the 3% that exceeds your actual tax.
Two practical points matter here. Missing the filing window can mean losing your right to reclaim the overpaid 3%, so the deadline is not one to drift past. And refunds are not fast; where the tax office owes you money, it commonly takes several months to arrive, which affects your cash flow after the sale even though it does not change what you are owed. If you sold at a loss, you still file Modelo 210, precisely so you can recover the withheld 3%.
Each owner files separately. A couple who own the property 50/50 submit two returns, one for each half of the gain.
Do not forget plusvalía: the second tax
Capital gains tax is a national tax on your profit. Separately, there is plusvalía municipal, a local tax charged by the town hall on the increase in the land value during your ownership. It is a different tax, paid to a different authority, usually within 30 days of the sale, and it is normally the seller’s responsibility. Sellers who budget only for the 19% and forget plusvalía can get an unwelcome surprise, so both should be worked out before you agree a price.
You can read more about the taxes of owning and selling in Spain on our Tax & Accounting page.
What about exemptions?
Some reliefs that residents rely on generally do not help a non-resident selling a Spanish holiday home. The over-65 exemption and the main-home reinvestment relief are aimed at a person’s habitual residence, so they rarely apply to a non-resident’s second property in Spain. Whether any relief is available depends entirely on your circumstances, which is exactly the kind of thing to check before completion rather than after.
Why this is worth getting right before you sell
The difference between a well-prepared sale and a rushed one is often thousands of euros: gains overstated because purchase costs were not claimed, refunds lost because a deadline slipped, or a plusvalía bill nobody planned for. We handle the full sale for non-resident clients, calculating the expected tax and the likely refund before completion, making sure the 3% and the paperwork are dealt with correctly, and filing Modelo 210 afterwards. See our Property Conveyancing service for how we manage sales end to end.
Frequently asked questions
How much capital gains tax do non-residents pay in Spain? A flat 19% on the net gain from the sale, whether you are resident in the EU or outside it, including UK residents since Brexit.
Do UK residents pay 24% capital gains tax in Spain? No. The 24% non-resident rate applies to income such as rent, not to the capital gain on selling a property. The gain is taxed at 19%.
What is the 3% retention when selling as a non-resident? The buyer withholds 3% of the sale price and pays it to the tax office as an advance on your capital gains tax. You reconcile it by filing Modelo 210, paying any balance or reclaiming any excess.
Can I get the 3% back if I made a loss? Yes. If you sold at a loss or your tax is less than the 3% withheld, you file Modelo 210 to recover the difference, though refunds can take several months.
Is capital gains tax the only tax when I sell? No. Plusvalía municipal, a separate local tax on the increase in land value, is usually also payable by the seller, typically within 30 days of the sale.
Selling in Murcia? Know your number before you sign
Whether you are selling in Puerto de Mazarrón, near the Mar Menor or in Condado de Alhama, you should know your true net position, the 19% liability, the 3% retention and the plusvalía, before you agree a price. At PALS we work it all out in advance and handle the filings in plain English. Book a consultation and we will make sure there are no surprises at completion.
