Many people ask what the benefits of being a fiscal resident of Spain are. This is a complicated question and an important one. It is best to discuss this with a specialised tax consultant as every one´s personal situation is unique, but in general there are advantages to being a resident of Spain, especially when it comes time to sell.
The first advantage is that there is no retention for residents at the point of sale, whereby for non-residents there is a retention of 3% of the purchase price. The second advantage to being a resident is that when you sell your house, assuming it was your primary residence, if you re-invest the proceeds within a period of 2 years, you are exempt from paying capital gains. The third advantage is that if you are a resident of Spain and you are over 65 and you sell your primary home as long as you have lived there for at least 3 years, then you are exempt from capital gains tax and you are not required to re-invest the proceeds on the purchase of another property.
Please note that if you have lived in the house you are going to sell for an extended period of time but you were classified as a non-resident, so you don´t meet the minimum requirement of 3 years, there are ways that accountants can use to try to prove that you really were a resident of Spain to enable you to avoid the retention and the capital gains tax. Please contact us at CumbreVillas.com and we can recommend some tax specialists and accountants that can advise you.
