When purchasing property here in Asturias the rule of thumb is to allow 10-12% above the purchase price to cover all extra fees and taxes. The biggest chunk of this is the purchase tax which in the case of second-hand properties (impuesto de transmisiones patrimoniales, ITP) is set at 8%. On new build properties the applicable tax is 10% IVA (VAT).
However, if you are looking to buy a rural property and make it your home then the good news is that you may be eligible for a 25% reduction in that purchase tax, from 8% to 6%. As an example, on the purchase of a 300,000€ property you would save 6,000€, which is not to be sniffed at.
This lowering of the ITP tax rate to 6% is a measure that is aimed at combating rural depopulation and is applicable in rural areas that are deemed to be particularly at risk from declining population and as long as the property will be the buyers’ main residence.
In order to qualify for the reduced tax rate you must take up residence in the house within 6 months from the date of purchase and it must be your full-time home for a continuous period of at least 3 years.
However it is understood that the house does not cease to be considered your permanent residence under the following circumstances:
a) In the event of the death of the taxpayer or of other circumstances outside of their control that prevent them taking up residence
b) When the taxpayer has a permanent residence linked to their profession or job, in which case the timeframes indicated start once their contract has ceased.
c) When renovation works need to take place prior to taking up residence. In this case the timeframe within which the buyer must take up residence is within 3 months of completion of the works, with an absolute limit of one year from the date of purchase.
The areas that are considered to be at risk of depopulation have been determined by the government and are listed in the official government bulletin (BOPA 240 15-XII-2020)
