Under the Law 14/2013, of 27 September, on support for entrepreneurs and their Definition From the 27 of September 2013, citizens not residing in the EU also have the possibility of applying for a residence permit in Spain, with which they can move freely through the 27 countries of the Schengen area. For this, they must invest, at least, 500,000 euros of own capital in a property in Spain. Amounts over 500,000 euros can be financed with a mortgage. The residence permit is also valid for the spouse and minor children, as well as for the parents of the investor. Being required to pay taxes as non-residents; the minimum length of stay is not limited. So, You may obtain a residence visa, and afterwards a residence permit, if you invest at least €500,000 in Spanish property (one or more), provided that at least the minimum investment amount is unencumbered (mortgage free). You may conduct the investment after your residence visa application is approved, provided that you have transferred the funds to Spain and concluded a sales and purchase agreement with guarantee of compliance prior application. Investment may be carried out by your non-Spanish company, provided that is not incorporated in a considered tax haven. You must own, directly or indirectly, the majority of its voting rights and the right to designate or remove the majority of the members of the board of directors. The residence visa is valid for 1 year, during this year you may apply for a temporary residence permit which will be valid for 5 years, provided that you still keep the investment. Your spouse and your unmarried dependent children may be included in the application. To maintain your residence status, you will be required to visit Spain at least once per year. After 5 years holding the temporary residence permit, you will be eligible for permanent residency. For residents under this scheme, no physical residence or place of abode is required to apply for a PR status. Note that the 1-year residence visa does not count in this 5-year period! The permanent residency will entitle you to live and work in Spain indefinitely. After 10 years of legal residency (temporary or permanent) you may be eligible for naturalization. To become a Spanish citizen, you will be required to commit to renounce your previous nationality, have financial stability, no criminal record, attend to an interview and prove your degree of integration into Spanish society, e.g. knowledge of Spanish language, culture, values and participation in Spanish social activities!
When buying a property in Spain you will have to deal with various aspects such as taxes, registration costs, but also fixed costs such as community costs, etc. Due to the rapidly changing regulations within the EU it is not easy to give a standard manual. We will explain the procedure and our services transparently with this manual. You do not need a lawyer if you have a professional behind you! If you have found a house that you want to buy, it is of course the custom that you make an offer. Once you and the seller agree on the purchase price and the day of purchase, we make a purchase contract. You must also deposit 10% advance as a deposit on our third-party account to seal the purchase. (later you will see why this is important) Of course, buyers often do not have the 10% in their pockets or sometimes even not in their ( Spanish) bank account. That is why a 3,000 € is usually deposited immediately, so that the property is removed from the website. Then you have two weeks to deposit the remainder of the 10%. From now on, real work will start! 1) Before you can sign any document or Notary deed for purchase or even open a bank account with a Spanish bank, you must apply for a NIE number (Numero de Identificación de Extranjeros) as a foreigner. Do not worry, we do that together. No problem. 2) With this NIE nr we will open a bank account with a Spanish bank of your choice. This is because you can only bring € 10,000/person legally across the border. The money must therefore be transferred from your Dutch or Belgian bank to the Spanish bank. For English buyers we offer a really good deal with a foreign exchange company that leave the tremendous high bank costs aside Later, at the notary, you will notice that you have to bring a guaranteed bank check for that purchase in order to conclude the purchase. Unlike as in a lot of countries, Spanish notaries do not have a third-party account to park the purchase money prior to signing the deed. "Spain is different" 3) We will now request a "Nota Simple" from the property register to see if there are no debts or mortgages registered on this property. If a mortgage is registered, we will notify the bank to pay this mortgage before signing the purchase deed. We will then ask you as the buyer to reserve a bank check for the exact amount of the outstanding loan (debt). For example, it can also be a tax debt that is registered! No problem here either. You take care to reserve a check for these taxes, or the owner pays his taxes in advance, or we, as a broker, pay those taxes from your 10% advance that you have paid us. All owners are mentioned on that Nota Simple. This is important to know if a death has occurred, and the inheritance tax may still have to be settled. No problem, we have also that procedure in our hands. 4) Construction violations: on the "Nota simple", which is a shortened representation of the deed (Escritura), the dimensions of the land and of the dwelling are also shown. Usually with an apartment that is not a problem, but older houses often have attachments that do not appear in the deed, and are therefore "Illegal" at the moment. This is only a matter of legalizing. The costs are for the seller. Do not be frightened by this word "Illegally" we have the procedure in hand to legalize it. No problem. If it is really illegal, we will not sell it! 5) If you buy an apartment, we ask the relevant administrator the document that the seller stands even with the payment of his community fees. For example, has that account already been in debt for let´s say two years and there is a debt of, for example € 2000, no problem, either the owner will pay for it in advance and he will show us the proof of payment, or we will pay this debt from your 10% advance! 6) If the seller is a "Non Spanish resident" (Dutch, Belgian or English for example), the tax office has a surprise for you! As a buyer you are obliged and responsible to withhold 3% of the agreed sales price and send it to the tax authorities (Hacienda) Do not worry, we will do this for you, through our lawyer, who will also provide you with the relevant tax certificate that it has been paid. 7) Speaking of Hacienda, or the tax authorities: The seller must pay a certain (local) tax on the sale of his property. This tax is called "plus valia" If he does not pay it, it will come on your head as a buyer afterwards. Do not worry "Either the seller will show us proof of payment of this plus valia at the SUMA (Tax collector office ), or we will pay the plus valia from the 10% deposit that you paid. Owners must also pay IBI in Spain (Impuestos Bienes Inmuebles) this is the property tax . Here too we want to see from the seller whether it has been paid or not. If not ... we pay it from the 10% deposit. You start now to understand that your 10% advance on our escrow account is the safety for you to ask the seller for all payment receipts, otherwise we will pay it for him and secure you from problems. 8) We want the latest invoices of all utilitie bills, so that we can put these utitilties on your name after the sale (water, electricity etc) 9) If you want to work with a financing or mortgage. We can help you with that. In short. You can borrow up to 60% to 70% at a Spanish bank with a maximum term up to your age 70. You can spend 30% of your income on a loan. My experience: do not count too much on it, the banks are quite "conservative" in accepting your loan application. But it must been said: more and more cases are been approved lately. 10) WE FINALLY GO TO THE NOTARY! On that day, it is up to us, brokers, to hand over a complete file to the notary in such a way that it can be establish that everything is in good standing. In the absence of the right documents, everyone can go back home and do his homework again! (To give you a practical example, the expiration date of the buyer's passport was exceeded, and the purchase did not go through that day). If there is a mortgage on the house, the bank will first be paid (with your check) and then the seller can sell for "Free and encumbered ". 11) Transfer tax and notary fees: The transfer tax in Spain is 10%. But on top of that you have to count the registration of the deed (We do this) and the notary also wants to earn something himself. So you can count on an 11% to 12% in total for all these transfer costs + Notary + register. Since the notary is not a tax collector office, you also transfer that 11% to our lawyer who will again give you the relevant tax certificate. So in total you transfer by bank transfer to our lawyer the 3% non resident tax ( if applicable see point 6) and the 11% transfer tax. 12) After signing the new title deed (escritura) by the notary and all parties present, you will be handed over your title deed and the keys and you hand over to the sellers the bank check of the remaining amount. 13) CHAMPANGE NOTE: Do not let this detailed description be a reason for "Do it yourself" adventures. There are still many small and minor pitfalls on the road that can cause you financial damage. Let yourself be guided by a professional! Copyright: Walter Matthyssen
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