Solicitors, Spanish Conveyancing Services, Property Lawyers - Costa Blanca, Torrevieja, Spain

Rodas Consulting S.L.

Danish Norska Swedish ruso Nederland Nederland Fran�aise

Legal Services

Mortgage Calculator
Capital Gain Taxes

Capital Gain Taxes

4. Change of permanent dwelling

If you sell one property in order to buy another, you have some special advantages if you are a resident, or become one. Because then you have the right to deduct the costs of buying the new permanent dwelling from the gains of selling the old one. You may have a complete exemption from paying capital gains taxes on two conditions:

  1. if the total declared sales price of the old permanent dwelling is reinvested in the purchase (or purchase and renovation) of new permanent dwelling, and
  2. that the reinvestment be done within a period of a maximum 2 years.

You will have a part exemption from capital gains taxes if the purchasing price of the new permanent dwelling is less than the declared sales price of the previous one, according to this formula:

amount reinvested x capital gains
________________________________
total declared sales price

Example on a part exemption: Using the calculations explained in previous chapters, you have got net taxable capital gains of 18000 Euros on a net total declared sales price of your previous permanent dwelling, let us say 72000 Euros. The declared purchasing price for the new permanent dwelling is 54000 Euros. The calculation is: 54000 Euros x 18000 Euros = 972 Million Euros. Then you divide the 972 million by 72000 = an exemption of 13500 Euros. You pay capital gains tax only on 4500 Euros (18000 Euros minus 13500 Euros).

 

© RODAS CONSULTING SL IS A COMPANY REGISTERED IN SPAIN WITH REGISTRATION
NUMBER B-53805917 AND REGULATED BY THE LAW SOCIETY

Copyright || Disclaimer || Aviso Legal