Taxes when selling a home: income tax and municipal capital gains (2026)
Selling well is not just signing at the best price: it is knowing how much the taxman keeps and how to reduce it legally. Three taxes affect a sale: personal income tax on the gain, the municipal capital gains tax (plusvalía) and that year's property tax (IBI).
Every refurbishment backed by an invoice reduces the gain you pay income tax on.
Income tax: the capital gain
Income tax charges the difference between the sale price (less selling costs) and the original purchase price (plus the taxes you paid when buying and any refurbishment justified with invoices). That gain is taxed on the savings scale, at rates from 19% to 28% depending on the amount.
Municipal capital gains (plusvalía)
The plusvalía taxes the increase in the value of urban land and is paid to the town hall. Since the tax was reformed, you can choose whichever calculation method is lower —the objective or the real one— and, if there was no increase in value, nothing is due. The usual filing period is 30 days.
How to pay less, within the law
There are important exemptions: if you reinvest the entire proceeds in a new main home within 2 years (before or after the sale), the gain is exempt; if partial, the proportional part is exempt. Sellers over 65 selling their main home are exempt from tax on the gain. A dation in payment is also exempt.
A practical tip: keep the invoices from the purchase and from every refurbishment. Every justified euro raises the 'tax purchase price' and therefore reduces the gain you pay on.
If you are a non-resident
When the seller does not reside in Spain, the buyer withholds 3% of the price on account of the seller's tax. It is worth planning for in advance.
This article is informational and does not constitute tax or legal advice. Every transaction is different; consult a professional before deciding.