Sales taxes: how much do you pay to sell your home?
If you’re thinking of selling, the first step is to get a clear idea of how much will go to taxes and costs. There’s no perfect simulator because every transaction has its own story: purchase and sale price, improvements you made, whether it’s your main home, whether you have a mortgage, the city it’s in… Even so, there’s a rule many people use as a guide: between 5% and 15% of the final sale price usually goes to total costs. In some sales it will be less, in others a bit more, but with that range you can start running the numbers.
In simple terms, you’ll pay IRPF if you’ve made a gain, you may face municipal “plusvalía” if the land has increased in value, and you’ll need to prorate the IBI for the year with the buyer if you agree to it. In addition, there are non-tax expenses that are part of the process: notary, possible mortgage cancellations, technical documentation (energy certificate, occupancy certificate/licence, land registry extract) and, if you work with us, agency fees. Don’t worry: we’ll break it all down calmly with examples so it’s crystal clear.
What taxes are paid when selling a home? (IRPF, plusvalía and IBI)
IRPF on capital gains: brackets, calculation and deadlines
IRPF only appears when there’s a capital gain. That is, when you sell above what it cost you to acquire the property, adding the expenses and taxes from that purchase, and subtracting the expenses incurred to sell.
To calculate it, imagine two boxes. In the first, the acquisition value: the price you paid at the time plus what it cost you to buy (notary, registry, taxes such as ITP or VAT, and certain commissions). In the second, the transfer value: the price you sell for minus what it costs you to sell (for example, agency fees if you assume them, part of the notary if that’s on you, cost of cancelling the mortgage if there is one). The difference between the second box and the first is your gain. On that gain, the applicable brackets are applied by the tax office.
When do you not pay IRPF even if you sell with a gain? Two very common situations: if you reinvest the proceeds in a new main home within the legal time frame, or if you are 65 or older and sell your main home. In both cases, if conditions are met, the gain may be exempt. You’ll declare it in the tax return for the year after the sale. If you make a mistake, the rules allow you to correct within the statute of limitations, so keep every invoice and come see us calmly: we review each document with you and tell you what counts and what doesn’t.
Municipal plusvalía: calculation methods and when it’s not due
The plusvalía (IIVTNU) is a municipal tax that looks at the increase in urban land value between purchase and sale. Since the reform, there are two paths and you can choose the most favourable: the objective method (applies coefficients to the cadastral land value) or the real plusvalía (takes into account the real gain attributable to the land). If you can prove there was no increase in land value, it’s not paid. In practice, we request the cadastral information, do both calculations and tell you which one suits you. Each city council has its own coefficients and allowances, so not all plusvalía bills cost the same.
IBI and other local taxes: who pays and prorations
The IBI for the year is linked to whoever appears as owner on January 1, but in the sale you can agree on a proration proportional to the months each party enjoys the property. It’s common to put it in writing in the contract and in the deed to avoid misunderstandings. If there are pending fees (waste collection, dropped kerb, etc.), it’s also wise to check them before signing.
Common selling expenses (non-tax)
Notary and Land Registry: what the seller assumes
The classic rule says the granting of the deed is assumed by the seller and the copies/registration are paid by the buyer, unless agreed otherwise. In practice, it depends on what the parties agree and local custom. Either way, we’ll give you an upfront estimate so you know what figures to work with and there are no surprises on signing day.
Mortgage cancellation and associated costs
If your home has a mortgage, it must be cancelled before or at the same time as the sale. This involves two things: the outstanding repayment with your bank and the registry cancellation (a cancellation deed that’s filed at the Registry). A gestoría can handle it or we can coordinate it with the notary to make it easier for you. Important: cancellation costs (fee, notary and registry for the cancellation) usually reduce the transfer value for IRPF purposes, so keep the invoices.
Energy certificate, occupancy certificate/licence and land registry extract
To sell you need the energy performance certificate. It’s issued by an authorised technician and its cost depends on size and type. In some regions you’ll also be asked for a valid occupancy certificate/licence; if it has expired or you don’t have it, it’s processed with a technician and municipal fees. And it’s always a good idea to have a recent land registry extract: it shows the registry status (ownership, charges, liens) and avoids surprises during negotiation. These three documents speed up the transaction and reassure the buyer.
Agency fees: what they include and how to optimise them
Our clients often tell us: “I don’t want to pay twice for the same thing.” We completely agree. That’s why our fees cover valuation, the marketing plan, viewings, buyer pre-qualification, negotiation, and coordination with the notary and bank, right through to completion. Plus, we help you optimise the total cost because many selling expenses can indeed be deducted in the IRPF calculation. Our goal isn’t to pay less for the sake of it, but to pay what’s fair with everything documented.
Exemptions and how to pay less (legally)
Reinvestment in a main home: requirements and deadlines
If you sell your main home and reinvest the proceeds in another property that will also be your main home, you may not have to pay IRPF on the gain. There are specific deadlines (usually two years before or after the sale) and requirements regarding effective residence. What does “reinvest the proceeds” mean? Not just the gain; we’re talking about the total sale amount, net of debts and expenses. If you only reinvest part, the exemption will be proportional. This is where good planning makes all the difference.
Over 65s and other exemptions (bare ownership, dación, etc.)
If you’re 65 or over and sell your main home, the gain is exempt. There’s also the option to apply an exemption if, being over 65, you sell another property and set up a life annuity with the proceeds (with limits and conditions). There are other relief cases: dación en pago of the main home to the bank in hardship situations, sales without real gain, or particular cases such as sales of bare ownership. The important thing is to provide solid proof for each situation.
Deductions and expenses you can add to reduce the gain
Expenses linked to acquisition
Everything you paid when you bought forms part of your acquisition value: the taxes then (ITP or VAT), notary and registry, gestoría and certain fees if they were necessary to acquire. If you made qualifying improvements (not simple repairs), they can also increase the acquisition value because they left the home in a better state than the original. Keep invoices and receipts.
Expenses linked to transfer
Many selling expenses reduce the gain: the agency fee if you assume it, notary when it’s on the seller, required technical certificates to be able to sell, property advertising if you paid for it, and mortgage cancellation (fee and notary/registry costs for the cancellation). It’s not about “adding expenses just because”, but about backing every amount with its invoice and ensuring it’s directly related to the transfer.
Important note: tax rules can change and each city council applies its own ordinances. That’s why we always review your real case before finalising the numbers.
If you still have questions, we can help
We are Emiris Homes, two professionals who live and work in Marina Alta. We love homes… but even more, we love the people behind every sale. If you need us to translate your transaction into clear numbers, to prepare the documentation with you, to coordinate notary and bank, or to review what you can deduct so you don’t overpay, our real estate agency in Dénia is just a short walk away: Calle Carlos Sentí 37, Dénia.
Call us, tell us about your situation and we’ll look at it together. Our service is personal; our goal is for you to sell with peace of mind and the certainty that every euro is well accounted for.