FAQ: Owning property

People have all sorts of questions about owning property in Tenerife, whether about going to the notary, the costs involved in a purchase, how to sell, valuations, taxes, you name it. Below are some of the questions I’m most often asked. If your question hasn’t been answered below, please just ask in the comment box at the bottom of the page. Just click on any question to expand it to show the answer.

If your question is about complexes, community life or the Law of Horizontal Division please see the Complexes FAQ page HERE.

Buying

When you buy an apartment. does the money have to be paid by bank draft or can it be transferred electronically? Also, does it have to be in Euros to go into a Spanish bank or can it be in Sterling if the seller wants it to go straight to the UK?

Monies can be arranged however the buyer and seller agree. Normally this is by bank draft from a Spanish bank in Euros at notary, but payment can equally be made by bank draft in Sterling, or drawn on a British bank, or even transferred electronically to any bank anywhere. Any notarial costs have to be deducted before the seller gets his or her money, but the way that money is paid to the seller at that point is purely a matter of negotiation between seller and buyer. Do be aware that it is in the interests of the buyer not to hand over any money until sure the new escritura has been signed, and in the seller’s interests to have the money before signing. Given the two conflicting interests, and the astronomical risks involved, it is worth going back to basics in my opinion and to hand over a bank draft in notary at the point of signing.

If a buyer pays a deposit and changes his mind, who gets the deposit: seller or agent or both?

Do you hand the notary the bank draft at the point of signing or give it to your solicitor to do so in our presence? Does the banker’s draft have to be for the agreed full amount? How does it all work?

To save time, paperwork, monies and keys are all arranged in the notary’s office before coming face to face with the notary himself. The money is never actually handed to the notary anyway, but to the vendor, and it would be entirely normal for each side’s lawyer or other legal helper to exchange monies and keys before the moment of actual signing. The bank draft can be for any percentage of the purchase price – how the monies are paid are entirely a matter of agreement between buyer and seller, though there is now a small limit of the percentage that can be paid in cash. The only rules in this respect are that the method(s) of payment must be listed in the escritura, and that all monies are traceable.

We were thinking about buying our Spanish property in the children's names for convenience and inheritance tax purposes but I'm worried about any tax/legal implications of doing such a thing. Any advice?

There are no legal implications as such. They would own the property outright and legally it would be nothing to do with you. I’ve known several people buy a property in their children’s name (or transfer it to them later) for such reasons. Any monies involved in a purchase must always be accounted for at notary, but there are no other issues unless you gift them the money in Spain, in which case there would be an issue of Gift Tax: adult children have an allowance of around €16,000 and then a rising tax rate (see HERE for the rates, which are the same as for inheritance tax in Spain).

Do all the same things apply to buying a mobile home, same taxes, ongoing costs etc?

A mobile home isn’t considered a “property” in the sense of purchase taxes, so it’s more like buying a car. I believe there will be taxes payable on the transfer of ownership, but they won’t be anything like the order of magnitude payable if you were buying an apartment. As to ongoing costs, this will vary on ground-site to site, and you’d need to speak to a tax adviser as to whether tax would be payable on an ongoing basis – from what I understand, it’s not clear whether the same non-resident assessment system applies to mobile homes as it does to bricks and mortar.

Do we need to do anything about the rates after we buy or will we just be sent a bill when they are due?

You need to take your escritura to the ayuntamiento and confirm that the property’s change of ownership has been registered by the seller. It should have been because it is the vendor who pays the plusvalia, and this involves submitting a copia simple of their sale, which gives the council the details of the new owner. It will be worth double checking, however, and while there you will be able to set up a direct debit for future payments.

Costs & Taxes

Could you tell me what costs are involved in buying a property, and how much I should allow for ongoing expenses?

We own an apartment but don't rent it out. We only use it for family holidays. We have just found out that we should be paying property tax based on assumed rental income? Is this true?

Yes, there is a notional rental income tax, which assumes legal but undeclared rental income. Please note that this is a tax imposed not just on “foreigners”, but any non-resident property owners, and so it is also payable by Spaniards themselves who perhaps live on the mainland with a holiday home in the Canaries. Please have a read HERE for all costs you might expect to have to cover as a result of owning property.

How and when is the Spanish tax due and payable? We have been told once a year, quarterly, that we both need to submit a tax return, even that we can and can't submit the declarations ourselves - all conflicting information. We know we cannot claim utilities against the income, only community charges and local taxes and we think we have to pay 24% on the rest.

Resident owners of property here should be submitting annual tax returns, but non-resident owners must also submit returns. Those who are in receipt of declarable rental income submit a modelo 210 quarterly. For jointly owned properties, a return has to be submitted in the name of both owners, but this can be a joint return, and does not necessarily have to be two separate returns. To a question I’m asked now and then, owners can do this themselves or employ someone to do it, as they please: there is no legal obligation to employ a “fiscal adviser” – that requirement was dropped years ago.

With regard to the tax rate, it went from 24% to 24.75% for 2012, 2013 and 2014 as a “special temporary crisis measure”, but from 2015 was reduced to 20% (24% for non-EU nationals); it will be reduced further to 19% in 2016 (again, 24% for non-EU nationals). As far as deductions are concerned, non-resident property owners who let out can now deduct all expenses connected directly with the letting of the property, eg electricity, water, cleaning services, etc. A gestor, asesor or accountant will help with the computations so that the deductions are allowed for the period of rental.

Bear in mind too that the notional rental income tax is charged on any unrented part of a year, or a whole year if no rental income at all is received, and this declaration is submitted annually. Non-resident owners also have to prove they are fiscally resident outside of Spain, so will need to get an annual certificate of fiscal residence from the Inland Revenue or other national tax department.

Could you please advise me where I can download the modelo 210 declaracion ordinaria for impuesto sobre la renta de no residentes?

Just within 4 years of buying my property I received a notice from the tax office saying that their valuation was more then stated in the escritura and that I had to pay the purchase tax on the difference between the two prices. I complained about the valuation and the time they had taken to ask for their tax, but they replied that the law allows them up to 4 years to notify and charge you interest on the delay. What else can be done about this?

This happens all too frequently when prices are far below what would be expected, and the tax office is correct to say that they have four years to demand a “top-up” sales tax. The problem has arisen, though, because of abuse in the past on the part of those directly involved with property transactions. “Black money” has traditionally been a standard part of such transactions and everyone, even notaries, knew it was happening. The tax authorities’ only recourse was to take an independent view of the transaction and “assess to tax” any property for which they did not believe the price noted in the escritura. The problem is becoming quite serious now that prices are falling genuinely here, with people paying sometimes just 50% of a “tax value”. What will happen, for example, to all those properties bought as repossessions from the banks? These are sometimes at knockdown prices, abusive in several other senses, of course, but there could well be a serious tax bill waiting up to four years down the line for anyone who buys property far below what the tax office will accept as the tax value. As to what can be done about it – nothing, I’m afraid, as far as I know.

Please can you tell me what a Plusvalia is and why Solicitor says it must be paid by the Vendor and what it is based on?

We have been advised that we should arrange to transfer the ownership of our apartment into a UK Company to avoid substantial inheritance tax should anything happen to either of us, can you advise us on the above issues please?

I have to advise against it in the strongest possible terms. Unless the company is already trading in its own right, the scheme runs a clear and significant risk of being considered fiscal fraud by the Spanish tax authorities, and that is a very very serious issue indeed. There are occasions when such a transfer into a company can work, but very often it is not to the advantage of anyone. Do note that this is not my own personal view, but legal opinion: please read what I wrote HERE and seriously consider an alternative solution to the inevitable inheritance tax bill.

I would like to transfer ownership of the apartment wholly into my wife's sole name and to do this officially and with no loose ends.how long would this take, what would the likely cost be, and would my wife have to be present at the notary where I assume this process would take place?

There is a set legal procedure known as a Deed of Dissolution of Joint Ownership. Under the Deed system, the 6.5% transfer tax is not payable, rather there is a stamp duty of (I believe) 1.5% of declared property value or of the purchase price, if higher. This stamp duty is a percentage of the whole property value, whereas the 3% non-resident retention which will be taken in lieu of any capital gains tax due will only be levied on the transferred half. There will also be notary fees because the procedure is conducted at notary, land registry fees because the official record of ownership needs to be changed, and a lawyer’s fees if you were to use one, which I would strongly recommend.

So in total, you are looking at combined fees (lawyer, notary and land registry) of around €2000 or so, plus the stamp duty (1.5% of 100%), plus the non-resident retention (3% of 50%), this last being reclaimable as normal provided that tax affairs are in order (non-res returns, deemed notional rental income tax paid, for example). For the rest, it operates as though it were a sale-purchase, and so both parties have to be physically present or represented by someone holding either a general power of attorney or one specific for the purpose. Thereafter the Deed is registered with the land registry and the ownership details changed, and it all happens just as quickly as a sale would.

Valuations

Can I get a valuation of an apartment I am considering buying to submit to the tax people BEFORE I sign anything? If so, who gives me this valuation? and is this something my solicitor would do as part of his searches etc.

Yes, you can get a valuation up front, and it’s a good idea if someone is in some doubt about whether the tax office will accept the escritura price. It can take up to a couple of months to get, but once it is given, the Hacienda has to stick with the value. It’s not an automatic part of a search, no, but it’s something I or any conveyancer, including an abogado, would do if specifically requested. You don’t submit it “to” the tax people, though, you get it “from” the tax people, the office in the Zentral Centre in Playa de las Américas … and keep it as a record of the fiscal value of the property so that the tax is known beforehand, and cannot be surcharged later.

Is there any way of finding out recent sold prices in the area rather than relying on an estate agents estimate of value that has been given to the seller?

Letting

We are considering letting out our residential apartment for three months. How can I find out what we are required to have or provide – things like complaints book (what form should this take?), fire extinguisher, smoke alarm etc?

You don’t need those things. A fire extinguisher and smoke alarm are a good idea of course, but not legal requirements. Complaints books are for commercial lets so won’t apply to you (and would only apply to the sole agent anyway if you had a tourist property). You just need a contract. For your own security, please read my “Renting a property” page in the Your Rights tab (direct link HERE) before committing yourself to anything.

Is there a list of residential property areas to assist buyers?

What is to stop a sole agent on a touristic complex basically hiking up the % they take from an owner each year. Are there any safeguards in place legally to restrict the % they can take/charge for their services?

Nothing to stop them, and no restrictions, other than the law requires them to act legally within their business model (a very broad definition!). But owners are entitled to remove their properties from the agent’s books, and if another would-be agent can get the requisite number, s/he would become the new agent. I suppose that voting with their feet is the only control they have, though it’s not much of a control because sometimes there aren’t enough who’ll walk, and they wouldn’t be able to let legally in the meantime. These are all the reasons why so many argue for changes in the legislation about the sole agent system, but it hasn’t happened.

Mortgages

How are hipotecas (mortgages) registered? Is it registered against the Referencia Catastral of the property?

I've been told it's compulsory to have life and buildings insurances with my mortgages. Is this correct?

It is compulsory to have buildings insurance with a mortgage under all circumstances, but despite what the banks frequently say, life insurance is not compulsory unless it is written into the terms of the mortgage document itself. Any policy you have for life insurance is likely to be very evasive about how to cancel. Most, though, have a clause somewhere allowing that the policy will lapse “if you cease payments”. Anyone with life insurance on a mortgage should also note that in the sad event that this becomes payable, it will come off the mortgage amount, not be paid as a cash lump to the insured.

I am a 50% owner of a property which is mortgaged, but the mortgage is in the name of my co-owner. What happens if he stops paying?

We have paid off our mortgage. What happens now?

Selling

What are the costs involved in selling our property in Tenerife?

Please have a look at the Notarial System & Costs page HERE: as you will see, as vendors you will be liable for plusvalía. Please also look at the Capital Gains & Inheritance Taxes Page HERE for an explanation of the capital gains tax payable, and the retention in lieu made for non-resident vendors. If you are using an estate agent, then there will be commission involved if they find you a buyer – this is normally 5% of the sale price but might be more or less depending on the particular agent.

I am thinking of putting a for sale sign outside my house. I have it with a few estate agents. Would estate agents have any problem with this.

They shouldn’t – it’s your house, and even an exclusive agreement with an agent wouldn’t preclude you trying to sell privately! If your property is part of a complex, technically you may not put up se vende (or se alquiler) signs, but a blind eye is frequently turned to them. The biggest problem you will find is that agents will be less likely to bring clients to view, fearing that they will jot down your number and deal directly.

The agent selling our house says we need an energy certificate before they can show our house to clients. Is this true? and who should do this job as the agent said they have there own people.

Anyone in the Canaries wishing to organize one of these certificates, or to confirm that someone else is legally able to issue them, should contact the Consejería de Empleo, Industria y Comercio. Dirección General de Industria y Energía, C/ León y Castillo, 200; Edificio Servicios Múltiples III , Planta 4ª; 35071 Las Palmas de Gran Canaria – tel: 928-899-400 . The full details on what is actually required (no, agents don’t need to be in possession of the physical certificates before they do viewings) are HERE.

What happens if you receive a fine, either refuse to pay or don’t have the means to pay and then a charge is levied against the property? Does this just stay there then until such time that the property is sold?

Yes, though a fine will attract “legal interest” of around 6% or so, plus possible penalties and costs so will end up being more than the fine levied. A fine charged against a property will show up when the new buyers’ conveyancer carries out a land registry sesarch – it will show up in the same way as any charge on the property, e.g. a mortgage. If a property is never sold but inherited on the death of the owner who was fined, inheritance tax would be payable before the property could be transferred. When it is transferred, it is treated like a sale, indeed the tax payable on a transfer is the same tax as that paid on a sale because a sale is, effectively, a transfer of title. Any fine would be payable at this point, along with interest, and along with transfer and inheritance taxes, before the property could be registered in your heirs’ names.

Can you advise of how long you have between selling and buying a property in Tenerife have you got to reclaim retention tax of 3%?

Is it correct that a resident over 65 who has been living in a house for three years is exempt from capital gains tax upon sale?

First, please read my page on capital gains tax HERE. As I say, “Fiscal residents over 65 who are selling a main home in which they’ve lived for more than three years are exempt from CGT without the requirement to reinvest.” So it’s not just a case of being over 65 and living somewhere for three years: the person must be both legally and fiscally resident, and have the property as a main home. As always, though, with tax issues, speak to a qualified adviser. You can contact Blevins Franks through links on this website – just put “Blevins Franks” in the search box above.

I am selling an apartment and have been asked for a certificate of fiscal residence from the tax office. Is this correct, and if so, how do I go about getting one?

It’s a normal and required process for tax residents selling property. You’ll need an appointment with the tax office and to take in personal ID and proof of ownership (copia simple would do) because the certificates are issued for particular fiscal transactions. You are then given a date to go back and collect the document. Click HERE and select the first option (cita previa) for an appointment, then choose the option for certificates … you’re after a “certificado de residencia fiscal”.

68 Comments

Hi
with regard to the plusvalia tax surely now a vendor could refuse to pay this as the courts have already ruled that it it is illegal in cases where the value of the property has fallen from the time of the initial purchase.

GERARD MC NEILL

3 May 2016

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There have been a few rulings, I think, but none in the Canaries … but no, a vendor couldn’t refuse to pay without being prepared for the Ayuntamiento to take action against them for non-payment. Each case would need to be the subject of a separate legal challenge by a vendor, I would think, at least until the Constitutional Court has ruled on the issue as a generality (and my understanding is that they are considering the matter but have not yet ruled.).

Certainly too a fiscal valuation would be required, and if the vendor is a non-resident, indeed, most often a retention will be taken to ensure the bill is covered to stop it becoming a bill that the new owners are held responsible for.

Janet

3 May 2016

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Hello Janet and everybody! About IRNR, for 2015, it is reduced to 20% from the beginning of 2015 (till 11th of July) and further (from the 12th of July 2015 till 31 th of December 2015) lowered to 19,5%.
Does that mean two different “‘modelo120”, correct? Thanks in advance and congratulations for your site!

Joss

5 June 2016

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I’m sorry I don’t know. As I say repeatedly, please direct any specific questions about tax and tax returns to qualified professionals. Please see the “Financial” section of the Resources page (main tab above) for links to Diana McGowan and Paul Montague, both of whom I can recommend for tax issues.

Janet

5 June 2016

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Where is the best place online to find people are renting their property for 2 – 3 months over the summer period please?

Thanks

Martin

6 June 2016

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There are links on the Resources page (main tabs above) to official tourism sites for legal holiday acommodation, but for very short-term private lets (i.e. under three months, and so which are deemed touristic and are not legal here) your best bet is to seek owners who are letting direct, usually through Facebook groups … just put Tenerife apartment rental in the search box. Bear in mind that over the summer months, most owners will want one or two week holiday lets, being the most profitabale, so you might struggle somewhat.

Janet

6 June 2016

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my daughter wants to buy our apartment in spain but pay in pounds,my Spanish lawer said we have to prove payment has been made any ideas thanks.

brian stephenson

14 June 2016

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It is quite normal, and absolutely fine, to pay in Sterling outside of Spain, but for money-laundering reasons, EU law require transactions to be provable. Your UK bank will need to provide proof of the payment, both the account the money leaves and the account it arrives in, and this proof will need to be included in the escritura your daughter signs at notary.

Janet

14 June 2016

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I have a holiday property in Amarilla Golf but live in the UK. My water and electric bills are paid usually by direct debit by BBVA bank in Playa. Due to a bank error my bills have not been paid for 6 months. Where can I go in Tenerife to pay these bills by cash when I come out in 2 weeks. Help please.

Alan Rogers

9 July 2016

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You should go to the offices of your water and electricity companies and get an up-to-date account of how much is outstanding, and whether there are any reconnection issues. Once you know the exact situation, they will confirm how you can pay – maybe over the counter, or you might need to go to a bank to pay over the counter.

Janet

9 July 2016

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Thank you. That really is very helpful. All I need to do now is to find my nearest Canaragua and Endesa Energia offices and go along with the money. Any idea where the closest offices are, please. Many thanks.

Alan Rogers

9 July 2016

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As far as I know the nearest Canaragua is in a shop in Marola Park, El Camisón, and the nearest electricity office in a shop in Oasis Dakota complex in Fañabe (opposite Gran Sur).

Janet

9 July 2016

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Hi Janet Do you know if there is a standing charge for your electric metre in Tenerife, just checked my on line banking and noticed Electric bill for €47, we have not been out for 2 months so wanting to understand why, any suggestions would be helpful

Michael

26 July 2016

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yes, there are standing charges here, and fairly hefty ones too.

Janet

26 July 2016

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Hi Janet my my husband and i want to buy a house with are adult daughter
we are non resident but she is resident and works
do you know how are yearly tax bill will be worked out
she will be living in the house and owns no other property
thankyou
sue

sue hughes

28 July 2016

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I don’t advise on taxes, but as always with these situations, there will be a pro-rata division in non-resident and resident taxes annually and on sale. I recommend that you jointly consult someone like Diana McGowan, a qualified asesora (like a certified accountant) who does tax returns and whose details are on the Resources page.

Janet

28 July 2016

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Hi Janet
thankyou very much for your advice
sue

sue hughes

28 July 2016

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Hi Janet
sorry to trouble you again
we are buying in south gran canaria in sonneland , do you know of a qualified asesora there we could use
thanks
sue

sue hughes

28 July 2016

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no, I don’t, I’m afraid. I have no connections with Gran Canaria.

Janet

28 July 2016

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Hi Janet
Where can i obtain a list of home improvements that are exempt from capital gains tax we are selling our property and have been told that we may have to pay capital gains but if you have improved the property they are taken into consideration, unfortunately we do not know what they class as ho e improvements.
Can you help
Thanks

Mandy

3 August 2016

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There’s no list – you claim and they accept it or not. The key is not a particular “thing” but whether you can prove the expense and have a tax receipt for it. Those are the only works you can claim for.

Janet

3 August 2016

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Do you know what happened at the court of European justice meeting on 12th July regarding the interest rates being charged by banks please

jackie ford

11 August 2016

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If you mean the clausula suelo, as far as I am aware a judgment has not yet been made, though a legal opinion expressed at the time of the hearing suggested that things weren’t looking bright for those who hoped to get overpaid interest backdated.

Janet

11 August 2016

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Hi Janet.
We are thinking about buying in Tenerife. The property has a mortgage outstanding and we are told the balance of the motrgage is deducted from the purchase price and that is paid to the bank.After the mortgage balance is deducted then i pay whats left to the notary for the property.Does that mean i am paying under the market value price after the mortgage balance is deducted and if so does that also mean a tax bill as i will be paying under the market price
and if so what is the percentage?
Thanks
Robert

Robert

15 September 2016

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no, because the full price will be declared in your new title deeds (escritura), and it will say, for example, that you bought a property for 200,000 with a mortgage of 100,000, and that the mortgage has been repaid by bank draft and a second bank draft was given to the vendors at notary for the remainder. The full price, including the mortgage being paid off, will be recorded so there’ll be no apparent underpayment.

If you get independent legal conveyancing when you buy you will be certain that all will be correct, that the paperwork is all in order, all taxes are properly paid and that you won’t be charged for anything you shouldn’t be paying for. Many estate agents will offer to do “the legals” in-house for a reduced cost or even “free”, but an independent conveyance will assure you that your purchase is guaranteed to be fully safe.

Janet

15 September 2016

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And from personal experience, you could do no better than ask the lady that runs this site to do it for you.

Derek

15 September 2016

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Hi Janet, Do you know the new tax rate for non residents in Tenerife for property tax?
It was 24.75 %, Has it now changed ?

Jeff Hampson

26 September 2016

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Yes. It was raised to 24.75% in 2012, but as far as I’m aware it was reduced to 20% from the beginning of 2015 and brought down again to 19% for this year.

Janet

26 September 2016

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Hello Janet
We sold our apartment in Tenerife early this year, using solicitor our agent recommended and after all bills were paid we closed our bank account in Tenerife.
Previous to selling we had used an accountant in Tenerife to manage our affairs etc but informed him we no longer required him once we had sold our property.
The accountant has now told us we owe €94 euro non letting income tax for 2015 and, including his own charges, wants to deduct a total of €225 from our bank account, even though I have already told him it is closed.
We are in Tenerife at end of October – could you tell me where I could go to to pay this outstanding tax myself, without involving my ex accountant? Thank you

Dazzler

11 October 2016

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You will need a modelo to pay the tax at the bank, but it sounds as though your accountant is charging for work done for a previous tax year and as such, it will be a bill that is already outstanding even if you actually go to the bank to make the transaction personally. The fact that you’ve just sold your apartment isn’t relevant to last year’s tax and accountancy issues. This is something your lawyer should have advised you was forthcoming.

Janet

11 October 2016

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will the tax office in Tenerife notified me if I don’t pay my plus valia tax

Jo

13 October 2016

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You need to give me more information. Are you a seller? Are you resident or non-resident? Has the property changed hands yet?

Janet

13 October 2016

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I inherited half a property and half was put in my name I don’t remember paying plus valia tax this was in 2011I am a Spanish resident

Jo

13 October 2016

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Then the debt could have been registered against your property. You will need to check with the local Ayuntamiento and, ideally, the lawyer who helped you transfer the title and pay inheritance tax.

Janet

14 October 2016

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Hi Janet, with regards to declarable rental income to be submitted quarterly, does every UK resident still need to attach their Certificate of UK residence? I checked with HMRC and they said the CoR can only be issued up to current date, so if this is the case, does this would mean getting a new CoR every quarter to be submitted with their quarterly taxes? Also, a very short timeframe of 20 days to get the CoR ready and available. Many thanks.

Ari

14 October 2016

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I don’t know, I’m sorry, you’ll need to check with an gestor or asesor who does tax returns.

Janet

14 October 2016

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I writing to ask if anyone can advise the type of costs, fees / taxes etc of buying a secure garage to store our car.

Having purchased an apartment some time ago I appreciate the array of costs involved in that but unclear of the costs relating to a garage purchase.

Thankyou in anticipation.

sniff

9 November 2016

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A garage is still a property so you will still have the purchase tax to transfer title, and the land registry cost of registering it in your name. As to fees, anything from €500 to €1500 depending on who you use.

Janet

9 November 2016

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To sniff. They will treat it as just another property sale so the same charges apply but pro-rata will be smaller as it will cost less than a house or apartment.

Stewart Kirby

9 November 2016

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Janet / Stewart – many thanks for your help and speedy replies.

sniff

9 November 2016

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Can you tell me exactly what paperwork is required at Notary as we are selling a property over 30 y ars old. TIA.

Diane Carroll

10 November 2016

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Your buyers’ lawyer/conveyancer will take care of the arrangements, but you will be asked for a copy of your escritura (or at least the section providing land registry details), last IBIs and basura, certificate from the community (if on a complex) showing all payments up to date, and last electricity and water bills. You will also need to produce an energy certificate.

Janet

10 November 2016

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Many thanks Janet

Diane Carroll

11 November 2016

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Maybe I’m going blind but I can’t see anything about Non Resident Property Tax, apologies if I’ve missed it

Our Management Company have just told me it’s payable now and I just wondered the basis of the charge and how it’s calculated. Also our charge is 260€ and the Management Co have added 97€ as their fee. Is this something i could just do myself to avoid that fee in future? If so how would i go about it?

Tony Cooper

28 November 2016

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Please see the Costs & Taxes section above – the first four questions all deal with non-resident tax.

Janet

28 November 2016

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HI Janet, about 18 years ago i sold an apartment in Tenerife and paid a 5% Tax Retention 2,100,000 pesetas…..could I have claimed this back . My solicitor made no mention of claiming it back ..??

Paul

29 November 2016

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Yes, the whole idea is that non-residents can claim it back. It’s a retention against settlement of capital gains tax and once that is paid then any credit balance is repaid. Bear in mind, though, that it is only repaid if the claimant’s tax affairs are up to date, and there is a possibility that with a large capital gain, the 5% (now 3%) wouldn’t actually cover the tax due so there might still be tax owing on top of the retention.

Janet

29 November 2016

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Hi, out of Caixa, BBVA and Santander. I wondered which one has the least transaction charges etc for non residents.

Deb Young

4 January 2017

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That should be an easy question to answer but I’m afraid it isn’t. Charges always depend on the number of “additional products” (e.g. insurance, pension, cards, etc) that one takes in addition to the basic account, and each bank calibrates charges in these respect differently. My own opinion is that they are all thieves, so that it’s much of a muchness, but it might be helpful if you have a look at THIS page, scrolling down to the section “Banks”.

Janet

4 January 2017

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I would agree with Janet, it’s unbelievable what they charge for given that you can carry out most transactions online so the bank isn’t doing anything. We are with La Caixa and friends are with Santander and BBVA, no one has a good word to say about any of them. Pick a bank with a branch close to where you live so that you can use their ATM for free, if you use a rivals ATM they often want to charge you.

Stewart Kirby

4 January 2017

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Hi Janet,
My estate agent in Spain says that it is not necessary for me to attend the sale of my property in Catalonia, Spain. What is to stop him running off with the monies?

Les

14 January 2017

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Nothing really. You should either be there in person or have someone you trust completely to hold power of attorney for you.

Janet

14 January 2017

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Hi Janet , we own a property in Adeje as non-residents . We plan to live here more than the UK . Would we need to become residencia and can you shed any light on what happens after the UK leaves the EU or give an opinion on the likely outcome, many thanks

Mike

14 February 2017

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Please see HERE for residence registration requirements (and HERE for further answers to questions about being legal and living here), and HERE for the Brexit issue.

Janet

14 February 2017

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Hi Janet, first of all want to say thanks for your hard work and all the advice you give! We purchased an apartment in Los Cristianos in 2014. We are now thinking about buying another one. We do have a gestor who does the 210 every year for us.
My question is are there any new tax liabilities to us since this will be a second property? What about if we later decide to sell one?
Many thanks
Val

Vallerie

20 February 2017

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Hi Val, there will be the same taxes on your second property as your first, but no “new” ones just because it’s a second property. As to selling, please have a look at the Selling section of THIS page on owning property … again there are just the normal sales costs, not any specific to the fact that you own more than one property.

Janet

21 February 2017

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Hi there,

Can you help. I am looking for a mortgage for a 2 bed apartment. I have been advised by more than one lender that because I am married I will need to have my husband on the mortgage. I do not want this and neither does he. Can anything be done about this.

Thank you Bernice

Bernice Marshall

15 March 2017

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I’m afraid that if the banks are setting that as a requirement I don’t see what can be done about it. I’m presuming that the apartment is intended to be in joint names, and the only solution I can see is that you buy it in your own name, and then your husband won’t come into it.

Janet

15 March 2017

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Hi Janet!

First of all thank You for your time and for all the useful information you provide here! This is the first site I check any time when something is unclear 🙂
My question would be about transfer tax, or any tax related to buying a SECOND apartment in Tenerife. We are buying our second apartment and we heard that the tax will be higher (then 6,5%) when is not the “first” home, as they consider it as more like an investment.. is that true? Is there any difference in costs when you buying second or third apartment? I know at bank when you taking mortgage it can matter if its not your first home ect.. I was trying to search for information but could not find anything.
Thank You,
Judit

Judit Schmidt

16 March 2017

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no that is not correct. The costs are the costs regardless of how many properties one buys, and regardless of whether one is a resident or not. I’ve been asked this before and I wonder if it’s a rumour arising from someone buying a second property with a mortgage, which would indeed increase costs because there would be a separate escritura, notary and land registry fees. Or it could be confusion caused by the difference in Capital Gains Tax liability for those who are selling a property that is not their main home.

Janet

16 March 2017

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Hi Janet, my husband visited Tenerife last year to host our wedding ceremony..we live in Florida USA, we fell in love with Tenerife and would like to buy a one bedroom apartment with the idea of renting and we maybe to used once per year as well. From all we have been reading of process of buying we are aware of at least 30 percent down payment thats required. Can you tell us what paperwork would be required by the bank from us to obtain a mortgage? And as well how to open a non residents bank account?
Thank you so much!

Sophia Watson

26 March 2017

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Buyers normally pay a 10% deposit here. As to getting mortgages and bank accounts, particularly paperwork required, that is too varied to comment now. It used to be simple: banks gave mortgages easily and opening non-resident accounts required simply a pasport and NIE. I remember those days well but they have not been like that for 10 years or so now. These days, hardly any banks will lend, and paperwork required varies bank to bank, but most will require some form of proof of income in addition to whatever personal ID they request.

Janet

26 March 2017

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There is rainwater getting into the apartment below mine from my terrace. I notice that in a previous answer you say that the owners terrace is their responsibility but in another answer you say that the outside surface of the building belongs to everyone. My terrace is exclusively mine but is also the outside surface & also a roof. If the insurers won’t pay for the remedial work should I as the owner or should the community share it?

jeremy Braund

27 March 2017

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If the terrace is part of the freehold, then the outside surface of the property will be the outside of the terrace. If the water originates in your terrace it will be your responsibility as far as the insurance is concerned. The fact that your terrace floor is someone else’s roof isn’t the point because the water is “originating” within your freehold. Where there is any confusion over particular responsibilities, however, the administrator and/or president of the specific complex need to advise.

Janet

27 March 2017

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Anywhere where the property registration fees are published? Property is 245k.

max

23 April 2017

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They will be imposed by the land registry in the municipality in which you are buying, so you would need to check locally. Generally you will be looking at around €500 or so.

Janet

23 April 2017

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Hi Janet.
I own two apartments through my British Ltd company. The bank wouldn’t open an account in the company’s name, so the account is in my name. I have authorised direct debit with the bank, but they refuse to pay the bill for local taxes because the bill and the account are in different names. I never see the local bills and the first I hear is when I am charged late payment penalties. I live in France, visit Tenerife rarely and have no Spanish. How do I unwind this mess?

John Cox

24 July 2017

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you should speak to the lawyer who oversaw the purchase and conveyance for you.

Janet

24 July 2017

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