Selling Your Property in Tenerife - Seller’s Guide

Selling a property in Tenerife can be just as overwhelming as purchasing a new property in Tenerife, finding out the correct procedure and what you need to do can prove quite daunting. With Crossley, Morfitt & Lennox, you can relax, we will help you in selling your property in Tenerife, explaining the legal procedures in plain English so you can concentrate on moving to pastures new.

The legal procedure for selling your property in Tenerife

When selling your property in Tenerife you are obliged to pay Capital Gains Tax and Plus Valia.

Capital Gains Tax - is calculated on the profit on the sale of the property, the difference between the values stated on the old and new escrituras. The procedure is that if you are selling your property in Tenerife and for whatever reason you are not resident at the date of sale you will have to make an advance payment of this within 30 days of signing the escritura relating to the sale.

The amount that you have to pay as the seller is 5% of the declared value of the property, which is detailed in the new escritura. However, the anomaly is that even though you are selling your property, in Tenerife the responsibility for making the payment lies with the purchaser, for this reason the 5% is normally withheld from the final purchase price and the purchaser undertakes to make the payment to the tax office.

As the seller you need to receive a copy of this payment receipt, to reclaim any amounts that are refundable and also to prepare a capital gains declaration. On occasion discounts may be available depending on when you originally purchased the property. Our professional team at Crossley, Morfitt & Lennox can advise you in relation to all of these matters as it can appear quite confusing.

If the amount paid is insufficient, then the remainder needs to be paid to the Tax Office, if you as the seller have overpaid when selling your property in Tenerife you will receive a refund within 12-24 months.

If you are selling your property in Tenerife and you are resident then you do not have to pay Capital Gains Tax as long as the net profit is lower than the purchase price of the new property that you are purchasing.

Plus Valia - when selling your property in Tenerife this is a tax that you must pay to the Town Hall (ayuntamiento) it is calculated on the increase in the value of land since the last sale of the property.

In addition, as you are selling your property in Tenerife you have an obligation to declare this in your annual income tax return.

Utility Bills. When selling your property in Tenerife the purchaser of your property will need copies of the latest {paid} utility bills. Crossley, Morfitt & Lennox will advise you what documentation is necessary, usually - water, electric, community charge bills etc.

By letting us at Crossley, Morfitt & Lennox handle selling your property in Tenerife, will ensure that the process is totally seamless and keep you advised every step of the way.

Figures published in August 2006 by the Bank of Spain show that property prices rose 130% between 1997 and 2005, the bank says that the reason for the prolonged increase is due to economic expansion, falling unemployment and the increase in both first and second home acquisition.

Crossley, Morfitt & Lennox “ The Family firm you can trust”