The cost of transferring a property is not just the amount the buyer has to pay the owner. There are additional costs that accompany the whole process, such as the Real Estate Transfer Tax.

Real Estate Transfer Tax is defined as the tax imposed by the state on every purchase and sale of real estate or, more specifically, on every transfer of real estate for consideration.

Before the contract for the transfer of the real estate (or real estate as a whole) is drawn up, the parties to the contract submit a joint declaration of Real Estate Transfer Tax with the obligation to pay the tax falling on the buyer of the real estate. This is an effective means of collecting money from the State with the ultimate aim of covering public expenditure.

The Real Estate Transfer Tax is not levied in cases of donation, parental gift, and inheritance, as in such cases the donation tax, parental benefit tax, and inheritance tax are levied respectively.

  • How is the Real Estate Transfer Tax declaration made?

The real estate transfer tax return is submitted to the tax office in whose territorial jurisdiction the property is located. However, it is now possible to submit the return digitally with the operation of the myProperty platform of the AADE.

  • How is Real Estate Transfer Tax calculated?

The following formula is used to calculate the Real Estate Transfer Tax:

Real Estate Transfer Tax = Real Estate Transfer Tax Coefficient x Taxable Amount

In most cases, the Real Estate Transfer Tax rate applied is 3% of the taxable value of the transferred property. However, there are cases where different rates of Real Estate Transfer Tax calculation are applied, depending on certain specific circumstances.

The taxable amount is defined as the highest value between the objective value and the agreed price stated in the transfer contract. The tax-free threshold depends on the personal characteristics of the buyer, such as the purchase of a first home.

 

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