Sergio Roldán, an architect from Seville, is buying a house in Chiclana from Chantal Dubois, who lives in Brussels. The agreed price is 410,000 €, but the deal has a bit of everything: Chantal pays the estate agency 18,000 € in commission, takes on the plusvalía municipal (the local tax on the increase in land value), leaves the furniture "included in the price" and accepts that 100,000 € will be paid eighteen months after the deed. Her adviser has told Sergio to withhold "3 % of what she actually receives". Sergio has done four different calculations and got four different figures.
The base the law lays down
Article 25.2 of the Law on IRNR (Spanish non-resident income tax) requires "3 per cent [...] of the agreed consideration" to be withheld. Article 14.1 of the Regulations repeats the same expression. It does not speak of the gain, or of the net price, or of what is collected at the notary's office. It speaks of what was agreed as consideration for the property.
That choice makes sense: the buyer knows neither the price at which the seller bought nor the seller's costs, so the law asks him for a calculation he can make with the deed in his hand. The fine adjustment, with costs and acquisition expenses, is made afterwards by the seller in her Modelo 210, under the rules that article 24.4 of the same law takes from the IRPF Law (Spanish personal income tax).
What does not reduce the base
| Item | Does it reduce the base of the 3 %? | Where it counts, if anywhere |
|---|---|---|
| Estate agency commission paid by the seller | No | In the seller's Modelo 210, as a cost of the sale |
| Plusvalía municipal borne by the seller | No | In the seller's Modelo 210, as a tax inherent in the transfer |
| Cancellation of the seller's mortgage | No | It is a use of the money, not a discount on the price |
| Arras already paid (the deposit under the preliminary contract) | No | They are part of the price paid |
| Deferred price | No | The base is the total agreed price |
| A higher or lower cadastral reference value | It has no effect | It has its role in other taxes, not in this withholding |
The seller's costs do have their place: article 35.2 of the IRPF Law says that the costs and taxes inherent in the transfer are to be deducted from the transfer value "insofar as they are paid by the transferor". But that is the calculation of the gain, which belongs to Chantal, not that of the withholding, which belongs to Sergio.
Sergio's figures
- Agreed consideration: 410,000 €.
- Withholding: 410,000 × 3 % = 12,300 €.
- The commission, the plusvalía and any other cost of Chantal's do not change that figure.
If Sergio had followed the idea of withholding on "what she actually receives" (410,000 − 18,000 − 100,000 deferred = 292,000 €), he would have withheld 8,760 € and paid in 3,540 € less than was due. That difference could still be demanded from him, with whatever surcharge or penalty applied.
When part of the price is paid later
Deferral is the part that raises most doubts. The obligation to withhold arises with the transfer, and the one-month period runs from it (article 14.3 of the Regulations). At that moment, the agreed consideration is 410,000 €, even though 100,000 will be collected in 2028. So the withholding is calculated on the total and paid in during the month following the deed.
In practice, that means the 12,300 € come out of the 310,000 € Sergio pays at the notary's office:
| Moment | Amount | To whom |
|---|---|---|
| Deed | 12,300 € | Agencia Tributaria, with Modelo 211 |
| Deed | 297,700 € | Chantal |
| Eighteen months later | 100,000 € | Chantal, with no further withholding |
When Chantal is taxed is another matter. Article 14.2.d of the IRPF Law allows, in instalment sales or sales with a price deferred for more than a year, the income to be allocated as the payments fall due; whether that option applies to her case and how it fits with her Modelo 210 is something her own adviser has to study. For Sergio nothing changes: he withholds once, on the total.
Sometimes the seller proposes that the 3 % be deducted from the last deferred payment, so as to receive more now. The Modelo 211 deadline runs from the deed, not from the last payment. If you accept, you will have to advance the withholding yourself with your own money and trust that you can deduct it later.
Furniture, parking space and storeroom
The Chiclana house is sold furnished. If the contract sets a single price "furniture included", the agreed consideration is the 410,000 € and the withholding is made on it. If the parties allocate a separate and genuine price to the furniture, it can be argued that that part is not consideration for the property, because the withholding refers to transfers of real estate. But the argument carries risk: a disproportionate allocation to the furniture may be challenged by the tax authorities, and it is the buyer who answers for the withholding. The prudent course, unless the furniture has a significant and documented value, is to withhold on the total.
A parking space and a storeroom, on the other hand, are real estate. If they are sold in the same deed, their price forms part of the base. If they are sold in separate deeds, each has its own withholding and its own Modelo 211.
If you have a contract with itemised or deferred prices and would like us to review the base before signing, send it through the Modelo 211 form.
Exchanges and payments not made in money
In an exchange there is no price in euros, but there is consideration: what the non-resident receives in return for the property. Article 1538 of the Civil Code defines an exchange as the contract by which each party undertakes to give one thing in order to receive another. If Chantal handed over her house in return for a flat of Sergio's plus 60,000 € in cash, the agreed consideration would be the value of the flat plus the 60,000 €.
The practical problem is that the buyer has to pay in the withholding in money even though he pays hardly anything in money. If the cash part is not enough to cover 3 % of the total, someone has to make up the difference, and it is worth agreeing in the contract that the seller will. The value given to what is handed over must be consistent with market value, because in her Modelo 210 the seller will apply the exchange rule in article 37.1.h of the IRPF Law.
If the price in the deed does not match the real one
The withholding is calculated on the agreed consideration, and the agreed one is the real one. If the deed showed a price lower than the one agreed, besides the problems in other taxes, the withholding paid in would be lower than the one due, and the difference would still be the buyer's responsibility. There is no way of protecting yourself from that other than putting in the deed what is actually paid.
When there is a mortgage that is taken over or cancelled, the base does not change either, but the distribution of the money does, and we explain it in there is a mortgage and subrogation. If there are several sellers and only some are non-resident, the base is the non-resident's share: we look at it in two sellers and only one lives here. And the effect on the buyer's money, in does the 3 % come out of my pocket?
The guide on how to fill in Modelo 211 shows where the base is entered on the form. The rest of the questions on the withholding, with the deadlines and the documents, are on the Salama Tax page on Modelo 211.