Andalucia’s great offers on Regional Real Estate taxes

As followers of the Costaluz Lawyers blog will know, Andalucia introduced reductions in regional real estate taxes last year. As a result, buyers of property in Andalucia have made considerable savings on tax payments, particularly on transfer tax.

The good news is that the regional government has decided to maintain these reductions throughout 2022. In addition, there are further discounts for specific circumstances. In this article, we describe these reductions in detail.

Is Andalucia keeping the reduced rate of transfer tax in 2022?

Yes, the general rate for transfer tax (Impuesto sobre Transmisiones Patrimoniales/ ITP) remains at 7%, down from the previous 8 to 10% payable on the purchase of resale properties in Andalucia.

In addition, the region is also maintaining the allowances for specific groups buying a home to live in (primary residence), provided that the value of the property does not exceed certain limits.

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Which specific groups qualify for reduced transfer tax in Andalucía?

The following groups may apply additional discount for ITP:

• Those who are under 35 or a victim of domestic violence or terrorism or if you buy the property in a municipality with a problem of falling population qualify for a rate of 3.5% transfer tax in Andalucia. The property price must not exceed €150,000 and it must be for the purchaser’s habitual residence.
• Those who have certified disability of at least 33% or are a member of a large family (3 or more children) may apply the rate of 3.5% when they buy a property whose value does not exceed €250,000.
• Individuals or legal entities whose business activity applies to the rules for the adaptation of the General Plan for the Real Estate Sector benefit from the reduced rate of 2% transfer tax in Andalucia.

What other reduced taxes exist for transfer tax in Andalucia?

There is also a reduced rate of 2% on transactions for Reciprocal Guarantee Companies (Sociedad de Garantía Recíproca/ SGR) or state or Andalusian public sector companies whose purpose is the provision of participative guarantees.

Buying property in Andalucia? Read this first.

What about the general reduction to 6% for all citizents in Andalucía?

We’ve saved the best news about lower transfer tax in Andalucia until last and it’s a big one. Anyone buying a property for their primary/habitual residence whose value does not exceed €150,000 qualifies for a reduced payment of 6%.

This deduction applies to any buyer as long as they fulfill the two conditions above (habitual residence and price). 

What about Stamp Duty tax (AJD)?

The regional government has also maintained the deductions in stamp duty introduced last year. Specifically, the general rate remains at 1.2%, compared to the previous 1.5%. This tax figure is levied on notarial documents, such as, for example, the signing of the deed of sale.

Find out more about paying taxes in Spain and Andalucia.

Are there any further reductions in Stamp Duty?

Yes, like transfer tax, stamp duty in Andalucia is also lower in certain cases, including:

• Those who are under 35 or a victim of domestic violence or terrorism or if you buy the property in a municipality with a problem of falling population pay 0.3% stamp duty if the property costs no more than €150,000 and is intended for the purchaser’s habitual residence .
• Those who have certified disability of at least 33% or are a member of a large family (3 or more children) may apply the rate of 0.1% when they buy a property whose value does not exceed €250,000.
• Individuals or legal entities whose business activity applies to the rules for the adaptation of the General Plan for the Real Estate Sector pay 0.1% stamp duty in Andalucia.
• Reciprocal Guarantee Companies (Sociedad de Garantía Recíproca/ SGR) or state or Andalusian public sector companies whose purpose is the provision of participative guarantees benefit from a reduced rate of 0.1%.

Is there a general reduction in Stamp Duty for property purchases in Andalucía?

Yes, and here’s more good news for anyone buying a property for their primary residence that costs no more than €150,000. They benefit from a general reduced rate of 1% stamp duty.

How can I find out more about property taxes in Andalucia?

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Maria Luisa Castro

Director and Founder

María founded CostaLuz Lawyers in 2006 and is the Firm’s Director. María is registered Lawyer number 2745 of the Cadiz Bar Association and is licensed to practice in all areas of law throughout Spain. Working closely with her team, María has developed the firm into one of the most highly regarded and trusted Spanish Law Firms acting for English-speaking clients with legal problems in Spain. We’re here to help. Contact us today for a free, no-obligation, initial legal orientation.