Claim the 3% Retention Back
If you are not a resident in Spain and you sell your property, the buyer is obliged to make a 3% retention of the purchase price and pay it to the Spanish Tax Office as a payment on account towards your Capital Gains Tax. This is colloquially called “the 3% retention”.
After the sale, your solicitor will calculate your Capital Gains tax liability, which will be based on whether you have made a profit with the sale or not. Sometimes, if you have not made a profit at all, you are entitled to have the full amount back.
ABC Solicitors can assist you claiming this 3% retention back.
This tax is paid towards the vendor’s potential Capital Gains tax, which has to be declared in the four months following the sale (although legally you have up to four years to claim it back) and it has a current rate of 21%.
This retention does not cover the vendor’s ‘Plusvalia’ tax liability, which is paid to the Town Hall and is a separate matter.
After the sale, the buyer has one month to pay this 3% retention to the local tax office using the 211 form (modelo). A copy of this 211 form is then given to the vendor or their lawyer, so they can request a refund (which can be full or partial) if it proceeds..
If you are owed a refund and have been waiting for a long time, we can make enquiries with the Tax Office on your behalf and hurry your claim along.
One of the most common questions is how long it takes to get this 3% retention back. It depends upon the tax office; some are quicker than others. In theory it shouldn’t take more than a few months, though you have to know sometimes the refund takes more than a year to arrive.
The legal period to claim your 3% retention money is 4 years from the date of the sale, so if this is your case, and you sold your house in 2009 or later and you want to claim the tax paid back, please contact us, we will be delighted to hear from you.