Understanding Capital Gains Tax (CGT) in Spain (2025 Edition)

If you're planning to sell your home, investment property, land, or any other asset in Spain, one of the most critical taxes you'll face is capital gains tax (CGT).

Capital gains tax applies to the profit you make when selling an asset. The profit is the difference between your original purchase price (plus associated costs) and the price you ultimately sell it for. And yes, in Spain this tax hits both residents and non-residents—though the rates and exemptions vary significantly.

What Is Capital Gains Tax (CGT)?

Capital gains tax is triggered when:

• You sell a property, land, shares, or other financial assets in Spain;
• The sale price is higher than your acquisition price.

This profit is taxable, and the amount you’ll pay depends on:

• Your residency status;
• The total gain;
• Whether exemptions or reductions apply;
• The date the property was acquired.

Unlike in some countries (such as the UK, where CGT is a standalone tax), in Spain, CGT for residents is part of the IRPF (Personal Income Tax) system. For non-residents, it is a fixed, standalone tax under the Non-Resident Income Tax Law.

Property Sale, let’s make this real.

You purchased a stunning sea-view villa in Marbella in 2015 for €750,000. After nearly a decade of market appreciation, renovations, and increasing demand, you sell the property in 2025 for €1,250,000.

Profit = €1,250,000 – €750,000 = €500,000 taxable gain

The €500,000 profit is subject to capital gains tax.

Let’s break down how this would be taxed in both resident and non-resident cases.

Capital Gains Tax for Spanish Residents

To be taxed as a Spanish resident, you must:

• Spend more than 183 days per calendar year in Spain; or
• Have your center of economic interests based in Spain.

As a resident, the gain is added to your savings income base and taxed progressively.

2025 Resident CGT Rates:

Taxable Gain Bracket (€)	Tax Rate
Up to €6,000	19%
€6,001 – €50,000	21%
€50,001 – €200,000	23%
€200,001 – €300,000	27%
Over €300,000	28%  (New top rate in 2023)

Calculating the Tax:

€500,000 gain taxed as follows:

• First €6,000 → 19% = €1,140
• €6,001 – €50,000 → 21% = €9,240
• €50,001 – €200,000 → 23% = €34,500
• €200,001 – €300,000 → 27% = €27,000
• €300,001 – €500,000 → 28% = €56,000

Total CGT = €127,880

You declare this as part of your annual IRPF return.

Capital Gains Tax for Non-Residents

If you’re not a Spanish tax resident, different rules apply depending on where you live.

Non-Resident CGT Rates in 2025:

Country of Residence	Tax Rate
EU/EEA (e.g., France, Germany, Norway)	19%
Non-EU (e.g., United States, UK, Canada)	24%

For U.S. and U.K. citizens, there is no tax treaty with Spain covering capital gains. That means:

€500,000 x 24% = €120,000

Non-residents must file Modelo 210 and pay this amount within 4 months of the sale. Late filings = interest + penalties.

Deductions & Adjustments (Residents & Non-Residents)

To reduce your taxable gain, you may deduct:

• Notary and registry fees
• Property transfer tax or VAT (on original purchase)
• Real estate agency commissions (both for purchase and sale)
• Capital improvements (with oficial invoices)

CGT Exemptions & Reductions (2025)

1. Main Home Exemption (Residents Only)

• If you sell your primary residence, and
• Reinvest the full amount into another primary home in Spain within 2 years,
  → You pay 0% CGT.
• Must be habitual residence: lived there at least 3 years

2. Over 65 and Selling Primary Home (Residents)

• If you’re 65+, and
• You’ve lived in the property 3+ years as your habitual residence,
  → You pay 0% CGT, regardless of reinvestment.
• This is a major planning point for retirees.

3. Assets Purchased Before 1995

If the property was bought before January 1st, 1995, reductions may apply.

• Applies to gain generated up to Jan 20, 2006
• Only for assets purchased over €400,000
• Reductions:
  - 11% for real estate
  - 25% for company shares
  - 14% for other assets
• Not applicable to assets gained after 2006.

If you’d like more information on how capital gains tax in Spain might affect you, or if you have questions about inheritance laws, don’t hesitate to contact Landcross Partners. Our experienced team is here to guide you through the complexities and ensure your interests are protected.