Actos Juridicos Documentados (AJD)
It is comparable to Stamp Duty. It can vary depending on the area. In the Valencia area a property acquired for holiday purposes leads to an amount of 1% of the value of the property as declared in the Title Deeds.
Escritura Pública de Compraventa
It is the Spanish name for the Purchase Title Deeds of the property, document signed before a Public Notary. It contains a detailed description of the property, the conditions of the conveyancing and the price of the property, identifying seller and buyer parties.
Hacienda
The Spanish Tax Office
IBI (Impuesto sobre Bienes Inmuebles)
Although you may often see it described as "municipal real estate tax", it is really the equivalent of local rates (i.e. a charge for public road repairs, hospitals, schools etc). It is paid annually to the local Town Hall (or, in the Alicante province, to the SUMA office – an agency that collect the payments on behalf of the Town Halls).
When buying a resale property, it is vital to see the latest paid-up IBI receipt before you sign anything at all with the seller, because if the IBI has not been paid you can find yourself liable for up to 5 years of back payments due. As explained above, in Spain such bills are charged to the property and not to the owner.
A new property will not be registered for IBI payments until the new owner takes possession.
The rateable value (valor catastral) of your property is calculated on the value of both the land and the building and the IBI tax (set by the Town Council and the same rate for all properties in the municipality) is applied to this rateable value. Your payment is therefore the rateable value of your property multiplied by the local tax rate.
ITP (Impuesto de Transmisiones Patrimoniales)
A tax on the transfer of ownership of a resale property only (does not apply to a new property). It amounts to 7% of the value of the property as declared in the Title Deeds.
IVA (Impuesto sobre el Valor Aňadido)
This is Spanish VAT and applies to the purchase of a new property only (not to a resale property). It amounts to 7% of the value of the property as declared in the Title Deeds.
NIE (Número de Identificación de Extranjero)
All foreigners with any financial interests in Spain, whether Resident or Non-Resident, are required to obtain a foreigner's identity number, called an NIE, which identifies you to the Spanish tax authorities. NIE numbers are issued by the Foreigners' Department of the National Police.
No Residente
You can remain as a "tourist" if you spend less than six months in Spain in any one calendar year and your principal residence is in another country.
Nota Simple
An extract from the Land Registry, a Nota Simple gives details of any mortgages or charges against the property. It is important to realise that any debts or charges registered against a property are just that - ie registered against the property itself and not against the person who took out the debt. It is therefore imperative to know that the property you are buying is debt-free!
Notario
A Notary is a highly qualified legal person who is an official of the State. A Notary authenticates legal documents and confirms the identity of the parties and the date of the signatures, and sets on public record that the Title Deeds (or other documents) have been signed in his/her presence. It is important to understand that the Notary is not acting for you and will not give you any advice. Historically, the Notary was a person with valued literacy skills who provided assistance to others in various matters such as the sale or purchase of land. The role became established in Law in the 1800s and has evolved ever since.
Padrón
A register of legal residents held at the Town Hall. As funding for the town's facilities and Services is based upon the numbers of people on the register, it is everyone’s responsibility to register.
Patrimonio (Impuesto Extraordinario sobre el Patrimonio)
It is a low-rate "wealth tax" on assets. Non-Residents are taxed on their assets held in Spain, while Residents are taxed on their world-wide assets.
Plus Valía (Impuesto sobre el Incremento del Valor de los Terrenos)
This is a tax paid on the increase in value of the land and the percentage is determined by the local tax authorities. It may vary according to location; time elapsed since the last transfer of title and land size. Not all Town Halls (Ayuntamientos) enforce this tax. Whilst normally the responsibility of the vendor, it has become customary for the buyer to pay the tax – and this may be stipulated in the Sale/Purchase contract. This tax can apply to the purchase of both a new and a resale property.
Referencia Catastral
A public record maintained by the Town Hall of the value and extent of the property, from which the rateable value is set.
Registro de la Propiedad
A registry which lists the ownership of, and any outstanding charges against, the property.
Valor Catastral
This is the rateable value of a property as set by the Town Hall. Please note that, because of a backlog, it may take some 18 months for the Town Hall to set the rateable value of newly built properties.
