There are two main taxes when selling a property in Spain: the Capital Gain Tax and the Municipal Plusvalia Tax. In this article we are going to focus on the Capital Gain Tax and its general rule for individuals, since there are many particular cases that we cannot deal with due to space limitations.

How is the Capital Gain which is going to be subject to the Tax calculated?

Patrimonial Gain = Value Transferred - Acquisition Value

The details on how to calculate these two values is as follows:

Value Transferred is the value for which the property is sold minus the expenses and taxes associated to the sale operation that are detailed below:

The real estate agency fees, if the operation is carried out through one, with its corresponding VAT (at this point it is important to know that to deduct an expense you must have a supporting document - receipt of payment of a tribute or invoice - so it is key to keep them when a transaction is carried out).
The Tax on the Increase in Value of Urban Land, known as Plusvalía Municipal Tax.
The expenses of cancellation of the mortgage in case there was one on the property.

Acquisition Value is the value that was paid for the property plus possible investments made on it, reforms (you must have invoices to be able to add them), plus the expenses and taxes associated with the purchase operation that are detailed below:

Notary and Land Registry expenses.
The Transfer Tax or VAT, as applicable, depending if it was a second hand property or a new unit.
The Stamp Duty (Impuesto de Actos Jurídicos Documentados).
The refurbishing costs of the house destined to the extension or to a substantial improvement of it. To add these costs to the acquisition value it is necessary to have the invoices that accredit these expenses.