Can I deduct agency fees from a capital gain on real estate in Spain?
Taxation of real estate capital gains in Spain
How much can you deduct from the sale of your property in Spain ?
How to deduct agency fees ? We explain everything to you!
It is important to know that you do not pay a "commission" to a real estate professional, but "fees" that pay for the provision of services and skills, in the same way as for other professions.
Real estate agency fees refer to the fees that an agency charges to manage the sale and purchase of a property: attracting customers, promoting the property, conducting visits, etc. Those who have sold their home with the services of one wonder if real estate agency fees can be deducted from personal income tax (IRPF) or in Hacienda. In this article, we solve the doubts.
Taxation of real estate capital gains in Spain
How much fees are paid to a real estate agent ?
The answer is that it depends on several factors and the type of agency. For example, online real estate agencies charge less than brick-and-mortar agencies and usually offer services at a fixed price. You can find agencies of this type that charge 1,000, 2,000 or 3,000 euros.
On the other hand, physical real estate agencies usually charge a percentage of the final sale price, the most common being 5%, although some offer their services at 3%. In the luxury real estate sector, it is common for real estate agencies to charge 7%.
Can the real estate agent's fees be deducted?
Yes, the fees of a real estate agency on the sale of a home can be deducted. To deduct them from IRPF tax, you will have to ask the real estate agent who managed the operation for the invoice.
Some unscrupulous real estate agencies offer to charge less fees or not to charge VAT if no invoice is issued. This is illegal and will prevent you from being able to deduct the fees.
How to deduct agency fees in hacienda ?
By adding up all these expenses, the transfer value will decrease, which will affect the difference between the purchase value and the sale value. The formulas for finding these values are:
- Acquisition value : purchase price + investments and improvements + expenses related to the purchase - depreciation.
- Sale value : sale price - fees and taxes.
- Capital gain : transfer value - acquisition value.
The percentage of tax applicable to the result obtained varies from 19% to 23%.
What happens if the capital gain is negative?
If the capital gain is negative, you will not have to pay income tax or a municipal capital gain. However, you must include the sale on your tax return in boxes 1631, 1632, and 1633.
What expenses can be deducted from the sale of a home?
When selling a home, certain expenses may be deductible from personal income tax, which reduces the tax base of the capital gain obtained. These expenses fall into two main categories: those that are subtracted from the transfer value and those that increase the acquisition value.
Regarding the sale value, expenses such as real estate agency fees can be deducted, provided that you have an invoice, the municipal capital gain, and expenses related to the cancellation of the mortgage.
On the other hand, the acquisition value can be increased by deducting the costs of renovations and improvements made to the property, taxes paid at the time of purchase, such as the Wealth Transfer Tax (ITP) or VAT (IVA), and notary and agency fees, paid at the time.
In which box should I declare the fees and the sale of a property?
The sale of a house, which generates a capital gain or loss, must be declared on page 15 of the income tax. In box 1817, indicate the type of heritage element by specifying that it is a dwelling. Then, the cadastral reference is added in boxes 1819 to 1821. Depending on the type of transaction, box 1822 is ticked if it is a onerous transfer (such as a sale or exchange) or box 1823 if it is a onerous transfer (such as a gift). Finally, the transfer value must be entered in box 1826 and the acquisition value in box 1830.
Can the real estate commission be deducted from a rental?
If you are a homeowner, you can deduct all the real estate fees you paid when formalizing a rental. This expense, which usually amounts to a monthly rent or 10% of annual income, is not regulated by law and is fully deductible. You have a period of three years from the completion of the real estate service to include it in your declaration, provided that the property appears to be the tenant's sole residence.
A real estate project in Spain?
Contact the Spanish real estate specialists of our agency MCB Costa Blanca immobilier.
Looking for a reliable valuation for your property on the Costa Blanca?
Sell with MCB Costa Blanca Real Estate RAICV Approved Agency, API Member.
Dominique SANTI
CEO
Publié le 06/09/2024 par
Dominique SANTI
How much can you deduct from the sale of your property in Spain? How to deduct agency fees? We explain everything to you.
