Despite Brexit, Brits can still buy in Spain
Since the United Kingdom officially left the European Union on 31 January 2020, British nationals purchasing property in Spain face a slightly different landscape. Brexit has introduced new legal requirements, tax implications, and residency considerations. However, buying a home in Spain as a British citizen is still very much achievable — it simply requires a better understanding of the rules. Here’s your comprehensive legal guide to navigating property purchases post-Brexit.
Understanding Residency and Visa Rules
One of the most significant impacts of Brexit for British buyers relates to time spent in Spain. Before Brexit, British citizens could come and go freely with the right to stay as long as they wished. Today, British citizens are considered “third-country nationals,” which means they can only stay in Spain for up to 90 days within any 180-day period without a visa.
If you plan to spend more than 90 days at a time in your Spanish home, you’ll need to apply for the appropriate visa. Popular options include the Non-Lucrative Visa — ideal for retirees or those with income from outside Spain — or the Golden Visa, which can be granted to non-EU nationals who make a significant investment (typically €500,000+) in Spanish property. Both allow you to stay for extended periods and offer routes to residency.
Buying Process and Legal Representation
Although British buyers face more administrative hurdles post-Brexit, the actual process of purchasing property in Spain remains unchanged. The key steps involve:
- Securing a Número de Identificación de Extranjero (NIE): The NIE is a tax identification number that every foreign buyer must obtain. It can be applied for at a Spanish police station or at the Spanish consulate in the UK.
- Opening a Spanish Bank Account: A local account is usually required for paying fees, taxes, and utility bills.
- Signing a Reservation Contract and Paying a Deposit: Typically 3,000–6,000 euros to take the property off the market.
- Drafting the Private Purchase Contract (Contrato Privado de Compraventa): This will set out the terms of the sale, the completion date, and other critical clauses.
- Executing the Public Deed (Escritura Pública): This is signed before a Spanish notary and is the formal transfer of ownership.
Hiring a reputable Spanish lawyer (abogado) to handle due diligence is highly recommended — especially post-Brexit, as tax implications and visa requirements have changed.
Taxes and Fiscal Considerations
Post-Brexit, British buyers face different tax treatment. Crucially:
- Income tax on rental income: EU citizens pay a flat tax rate of 19% on Spanish rental income, with deductions allowed for expenses. Non-EU citizens, including British buyers post-Brexit, pay a 24% rate on gross income with no deductions. This is an important factor if you plan to let your property when not using it.
- Capital gains tax (CGT): UK nationals must pay CGT on the profit when they sell a property. The rate for non-EU owners is also higher — 24% instead of 19%.
- Inheritance and gift tax: Spain’s inheritance tax rules apply regardless of your nationality. However, rates and allowances can vary regionally. British owners can benefit from some regional tax breaks, especially if they register as tax residents.
Additionally, purchasing a property in Spain entails around 10–14% in closing costs, including transfer tax (ITP) for resale properties or VAT (IVA) and stamp duty (AJD) for new builds. These rates remain the same post-Brexit.
Golden Visa and Investment Options
A key incentive for non-EU buyers is Spain’s Golden Visa programme. It grants the right to live and work in Spain to those investing at least €500,000 in real estate. It also allows you to move freely in the Schengen Area — perfect for British citizens who want to visit other European countries without the usual 90/180-day restrictions.
Applicants can also include their spouse and dependent children. After five years of maintaining the investment, you may qualify for long-term residency. After ten years, you could also pursue Spanish citizenship — although this usually requires renouncing UK citizenship.
Mortgages and Financing
Post-Brexit, Spanish banks continue to lend to British buyers. Typically, banks offer up to 70% Loan-to-Value (LTV) for non-residents at competitive rates. Be prepared to show proof of income and savings. It’s also a good idea to compare banks and consult a specialist mortgage broker who understands both the UK and Spanish property markets.
Future Outlook and Practical Advice
Despite Brexit, British interest in Spanish property remains strong — especially along the Costa del Sol and in the Balearic Islands. Many British buyers recognize that owning a property in Spain is a lifestyle investment as much as a financial one.
If you plan to buy post-Brexit, keep these practical points in mind:
- Start early: Applying for an NIE and mortgage pre-approval can take several weeks.
- Work with professionals: A Spanish abogado, notary, and tax adviser familiar with post-Brexit requirements can help you avoid pitfalls.
- Factor in tax changes: Consider future tax implications — especially if you plan to rent.
- Think long-term: Post-Brexit legalities encourage long-term commitment through visas or Golden Visa schemes, so have a clear plan for your future in Spain.
Buying property in Spain as a British citizen is still very much possible post-Brexit. By understanding the legal landscape — from visas and tax considerations to the conveyancing process — you can make an informed decision and fully enjoy your Spanish property. With careful preparation and the right advice, Brexit is no barrier to making your dream of owning a home in Spain a reality.
