Taxes when selling an apartment in Madrid

If your next goal is to put your home up for sale in the capital, you have to be aware of all the taxes you will have to pay for the profit obtained. We detail one by one the taxes that exist when selling an apartment in Madrid.

Three taxes that you will have to pay when selling an apartment in Madrid

IRPF: Personal Income Tax

The Personal Income Tax contemplates the payment of taxes for capital gains. Therefore, if profits have been obtained from the sale of the property, it will be an unavoidable requirement for the seller to pay taxes on the operation in the Income Statement.

Depending on the profit obtained, the taxation will be higher or lower. This is defined by sections:

• Up to 6,000 profit: 19%
• Between 6,000 and 50,000 euros: 21%
• Between 50,000 and 200,000 euros: 23%
• More than 200,000 euros: 26%

Only on three occasions is it exempt from taxation:

• When no profit is obtained.
• When the profit obtained is reinvested in the purchase of another habitual residence.
• If the seller is over 65 years of age and the one he sells is his habitual residence.
• If there is a dation in payment.

Municipal capital gains

The Municipal Plusvalía is another of the taxes that must be paid when donating, inheriting or selling a property. It is a tribute in charge of taxing the increase in value of urban land.

It has a municipal character, so it is paid directly to the Town Hall where the house is located. The term to pay it is 30 days.

There are two ways of calculating the Municipal Capital Gains in Madrid: the objective method and with the real method. Discover both options, with a practical example, here.

IBI: Real Estate Tax

And finally, the Real Estate Tax. This tax usually causes confusion regarding who should pay it: the buyer or the seller.

The answer is simple, the City Council will charge the IBI to the person who appears as the owner on January 1. Although many times, buyer and seller usually reach an agreement to divide the amount depending on the moment the sale is signed.

The collection period established by the Madrid City Council to pay the IBI is from October 1 to November 30.

If your next goal is to sell a flat in Madrid without worrying about the process, with the maximum guarantees and as quickly as possible, at KM2 Real Estate Services we will help you achieve your goals.

Get in touch with our real estate agency in Madrid and opt for an honest and profitable process adapted to your needs.