Selling a Spanish property brings several taxes into play, and together they determine what you actually walk away with. As a UK resident and Spanish non-resident, you are liable in Spain on the sale.
Capital gains tax #
If you sell at a profit you pay tax on the gain under Spanish non-resident income tax.
The rate for non-residents is 19 per cent, and unlike the income tax rate this one is not affected by being outside the EU. You pay on the net gain, being the difference between the sale price and the purchase price.
You can deduct costs, which reduces the taxable gain:
- The transfer tax or VAT you paid on purchase
- Notary and legal fees
- Agency commission
- Improvement works, provided you have the invoices
That last one is why keeping every builder’s invoice for fifteen years is not paranoia. Without documentation the cost does not exist as far as the Spanish tax authority is concerned.
The 3 per cent retention #
On a sale by a non-resident, the buyer is obliged to withhold 3 per cent of the sale price and pay it directly to the Spanish tax authority. It counts as an advance payment against your tax.
Two outcomes follow.
If your actual tax is lower than the retention, or you sold at a loss, you can reclaim some or all of the 3 per cent. That reclaim is not automatic and takes months, so budget for the cash flow.
If your tax is higher, you pay the balance through your return.
Plusvalía, the municipal tax #
Separately from the tax on your gain, there is a municipal tax called plusvalía. It taxes the increase in the value of the land, not the building.
The amount depends on the cadastral land value and how long you owned the property. Where you sell at a loss, it can be reduced or challenged, following changes to how it is calculated.
Plusvalía is normally paid by the seller.
Filing #
The 3 per cent retention is handled by the buyer through Modelo 211. Your own return goes on Modelo 210, and any refund is claimed through it.
Getting the calculation right is what stops you either overpaying or leaving money with the tax authority.
The UK side #
Spain taxes the gain first. But as a UK resident you also pay UK capital gains tax on worldwide disposals, so the sale goes on your self assessment return.
You claim credit for the Spanish tax paid, so you are not taxed twice. Where UK CGT on the gain is higher than the 19 per cent paid in Spain, you pay the difference to HMRC.
Be aware that the UK calculates the gain in sterling, using the exchange rate at purchase and at sale. A property that made no gain in euros can show a taxable gain in pounds purely from currency movement, and the reverse is equally possible.
Practical points #
Keep every purchase and improvement invoice, and check you can substantiate each cost. Make sure your NIE is still in order. Ask the town hall how plusvalía is calculated for your property. And have the expected tax calculated before you accept an offer, not after.
In short #
Selling in Spain involves capital gains tax, the 3 per cent retention and plusvalía, plus a UK return afterwards. Mapped out in advance you know what you keep.
Sale taxation involves both countries and the sterling calculation frequently surprises people. Have the figures reviewed by an adviser before you commit to a sale.
Last reviewed 2026-08-24
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