selling a property in ibiza

S

sam23

Active Member
Hi, Can anyone help please?

I am selling my apartment in Ibiza and was wondering what taxes i have to pay as a foreigner.

The estate agent has said 5% + 16% VAT. Is this just for the estate agent? Or do i have to pay further Tax to the government.

Your help would be appreciated.

Thanks

Sam
 
the 5% is the estate agents fees. you will have to pay capital gains tax on the sale of your apartment. it's a percentage of the difference between what you paid plus any improvements you made and the selling price. your buyer has to deduct a percentage of the official selling price and pay this to the taxman. this is so you can't do a moonlight flit without paying the tax. consult a gestor for the exact amounts involved as i've forgotten.
 
stephen said:
the 5% is the estate agents fees. you will have to pay capital gains tax on the sale of your apartment. it's a percentage of the difference between what you paid plus any improvements you made and the selling price. your buyer has to deduct a percentage of the official selling price and pay this to the taxman. this is so you can't do a moonlight flit without paying the tax. consult a gestor for the exact amounts involved as i've forgotten.
Click to expand...

Thanks Stephen,

I understand i have to pay 18% CGT and 3% retention which is deducted from my CGT.

The thing i dont understand is the estate agent is charging my a 5% fee PLUS 16% VAT. So hes basically charging me 21%. Is this normal practice?

Thanks
 
It will be tax on his 5% fee, But I would suggest you have a shop around, I have seen less than that these days,

Have a good one
Tim
 
sam23 said:
The thing i dont understand is the estate agent is charging my a 5% fee PLUS 16% VAT. So hes basically charging me 21%. Is this normal practice?

Thanks
Click to expand...

As Stephen says it is now 18% IVA, they add this on because the days of them getting their commission in 'B' (cash) have now more or less gone, so they are charging you VAT.

They arent charging 21%, they are charging 5% and then another 18% of the 5% on top. You will be able to off set the 18% against your capital gains once it is figured out, this will then be deducted from your 3% retention, it can take a while though so be patient and hire a decent representative (fiscal or accountant) to make sure you get it back (alot of people just go and forget it believe it or not)

blackswan555 said:
It will be tax on his 5% fee, But I would suggest you have a shop around, I have seen less than that these days,
Click to expand...

Owning an estate agency myself we hear alot of people moan regarding the commision fees. It's the standard rate TBH, though you can get 3% if you give them exclusivity, obviously this restricts the possibilities of a sale as only one agency has it.

The trouble is if you insist to agents that you dont want to pay the 5%, they may well accept this (esp if its unique, well priced and or something they can sell quickly) but the trouble is they wont network it with collaborating agents as they will have to split it 50/50 and therefore theyd rather sell something else with more commision. If they cant network it then it really restricts your possibilities.

If you want my advice then I'd recommend doing your homework regarding the agencies, ask around who has got the better reputations. I'd choose say 4/5 located around the island.

Then regarding the commision tell them that you are happy to pay the 5% if you get the asking price or as close to it as possible (you can add it into the price) and you are happy to pay 5% if they are having to share with a collaborator.

The truth of it is that no one pays full asking price, unless its super cheap or very unique. So as and when you get an offer, tell the agent look I'll accept such and such, but you need to reduce your commision. If theyre decent and want to do the deal most will take a chip to get the deal done. But play hard ball, you need a thick skin !! We have reduced our commisons alot this year to get deals done, we'd rather sell it than lose it completely, and 3/4% is still alot of money, especially in this climate !!

As a matter of interest where is the apartment ??
 
Hi, can you help again please? if i sell a property for the same amount i bought it for , what sort of fees will i be paying?
Im not using an estate agent. Do i still pay 3% retention?

Thanks

Sam

weloveliam@space said:
As Stephen says it is now 18% IVA, they add this on because the days of them getting their commission in 'B' (cash) have now more or less gone, so they are charging you VAT.

They arent charging 21%, they are charging 5% and then another 18% of the 5% on top. You will be able to off set the 18% against your capital gains once it is figured out, this will then be deducted from your 3% retention, it can take a while though so be patient and hire a decent representative (fiscal or accountant) to make sure you get it back (alot of people just go and forget it believe it or not)



Owning an estate agency myself we hear alot of people moan regarding the commision fees. It's the standard rate TBH, though you can get 3% if you give them exclusivity, obviously this restricts the possibilities of a sale as only one agency has it.

The trouble is if you insist to agents that you dont want to pay the 5%, they may well accept this (esp if its unique, well priced and or something they can sell quickly) but the trouble is they wont network it with collaborating agents as they will have to split it 50/50 and therefore theyd rather sell something else with more commision. If they cant network it then it really restricts your possibilities.

If you want my advice then I'd recommend doing your homework regarding the agencies, ask around who has got the better reputations. I'd choose say 4/5 located around the island.

Then regarding the commision tell them that you are happy to pay the 5% if you get the asking price or as close to it as possible (you can add it into the price) and you are happy to pay 5% if they are having to share with a collaborator.

The truth of it is that no one pays full asking price, unless its super cheap or very unique. So as and when you get an offer, tell the agent look I'll accept such and such, but you need to reduce your commision. If theyre decent and want to do the deal most will take a chip to get the deal done. But play hard ball, you need a thick skin !! We have reduced our commisons alot this year to get deals done, we'd rather sell it than lose it completely, and 3/4% is still alot of money, especially in this climate !!

As a matter of interest where is the apartment ??
Click to expand...
 
it's out of your hands. the buyer of the property has to deduct the retention from the official sale price, no matter what that is, and pay it to the taxman. you then have to complete an annual tax return which demonstrates that you have not made a profit and you should get the money back then.


here's my tip, get yourself a gestor. they will advise you and it sounds like you need it, on all aspects of the sale, including the tax aspect and all the bits of paper you need to take to the notary's office when you both sign on the dotted lines.
 
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