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The annual costs of running a property in Spain

The following is a guide to the approximate costs of running a property in Spain. It is assumed that the value of the property is 1,000,000 euros. Only the standing charges are assumed for the utilities, as when you are staying in Spain, you will not be using these services back in the UK. Water and electricity are about the same price here as they are in the UK. All costs can vary, and this is only a representative example.

Urbanization fees only apply when a property is part of a development with communal areas. This would typically be an apartment, a villa in a gated community, or where there is a communal swimming pool. The cost varies according to the your share of the communal costs (gardening, cleaning, security). For a villa in the countryside, outside of an urbanization, there will not any such fee.

Wealth Tax is chargeable on property. This varies according to a sliding scale and there is a 700,000€ threshold before tax is charged. If the property is in joint names this threshold applies to each owner, so if the property is in the joint names of a husband and wife then tax would only be levied on property in excess of 1.4 million euros.

Income tax is charged on the assumption that you will be renting out the property for a couple of weeks every year. If the property is you main residence (i.e. not just a holiday home) then this will not be levied. It is calculated according to the catastral value, but is normally in the region of 0.2% of the value of the property.

Example 1

For an apartment (in an urbanization) of value 1 million € in a single name the approximate annual costs would be:

Item Amount
 in euros
Urbanization Fee 950
Property Tax (IBI) 450
Rubbish Collection 250
Wealth Tax 5489
Income Tax 2000
Insurance 500
Fiscal Representative 125
Utility Standing Charges 150
Total 9914

 

Example 2

For a villa in the countryside in joint names and having the same value of 1 million euros:

Item Amount 
in euros
Urbanization Fee 0
Property Tax (IBI) 450
Rubbish Collection 250
Wealth Tax 0
Income Tax 2000
Insurance 500
Fiscal Representative 125
Utility Standing Charges 150
Total 3445

Note: Actual value will be different. These examples are for demonstration only.

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