IVA and AJD on New-Build Property in Spain: VAT and Stamp Duty Explained for 2026

IVA and AJD on New-Build Property in Spain: VAT and Stamp Duty Explained for 2026

If you're buying a brand-new home in Spain — straight from a developer, never previously occupied — the tax picture looks very different from buying a resale. Instead of the resale transfer tax (ITP), you'll pay IVA (Spain's VAT) plus AJD (Actos Jurídicos Documentados, or stamp duty). Together these are the single biggest line item on your closing statement after the price itself, and getting them right is essential before you sign anything.

This 2026 guide walks foreign buyers — from the US, Canada, the UK, and elsewhere in Europe — through how IVA and AJD work on new-build property in Spain, who pays what, and the pitfalls to watch for. Rates and rules change, regional governments adjust AJD frequently, and your personal situation matters. Always confirm current figures with the Agencia Tributaria, your autonomous community's tax authority, and an independent licensed Spanish *abogado* before you commit.

When IVA Applies Instead of ITP

The rule of thumb: IVA (VAT) applies to the first delivery of a new property by a developer or promoter. ITP (Impuesto sobre Transmisiones Patrimoniales) applies to second-hand homes between private parties.

You'll pay IVA + AJD when:

• You buy directly from a developer who built or rehabilitated the property.
• The property has never been occupied, or has been occupied by the developer for less than two years before sale to you.
• You're buying off-plan and paying staged deposits during construction.
• You're buying a brand-new commercial unit, parking space, or storeroom from the promoter.

You'll pay ITP (not IVA) when:

• The home has already had a first owner-occupant.
• You buy from a private individual rather than a business.
• The property was rented out by the developer for more than two years before being sold to you (it is then considered "second transmission").

This distinction matters because IVA is a national tax with a uniform rate, while ITP is set regionally and varies widely. AJD, by contrast, is regional and varies by comunidad autónoma.

The IVA Rate on New-Build Homes

For residential new-builds in mainland Spain and the Balearic Islands, the IVA rate on housing has historically been 10% of the declared purchase price. For social/officially protected housing (Vivienda de Protección Oficial de Régimen Especial), a reduced rate has applied. For garages and storerooms sold together with the home (up to a limit, typically two parking spaces), the same residential rate generally applies; sold separately, they're taxed at the general rate.

Important regional note: The Canary Islands do not charge IVA. Instead, they apply IGIC (Impuesto General Indirecto Canario), at a lower rate. If you're buying in Tenerife, Gran Canaria, Lanzarote or elsewhere in the archipelago, your tax calculation is entirely different — confirm with a local asesor fiscal.

For commercial premises, plots of land sold by a developer, and certain other non-residential transactions, the general IVA rate applies — significantly higher than the residential rate. Mixed-use purchases need careful structuring.

Rates can be adjusted by the Spanish government and have been the subject of political debate. Before signing your contrato de arras or escritura, confirm the current rate with the Agencia Tributaria (AEAT) or your abogado.

AJD: Stamp Duty on the Deed

AJD is a documentary stamp duty levied on notarised deeds that are registrable in a public registry — which includes your escritura pública de compraventa (the purchase deed) and, separately, any mortgage deed.

Key points:

• AJD is regional. Each of Spain's 17 comunidades autónomas sets its own rate. Typical ranges fall between roughly 0.5% and 1.5% of the declared deed value, but exact figures vary — Madrid, Andalusia, Valencia, Catalonia, the Balearics, and Murcia all differ, and rates have been changed several times in recent years.
• You only pay AJD on new-builds. On resale homes you pay ITP instead, and AJD on the purchase deed doesn't apply (though AJD on a mortgage deed may).
• Mortgage AJD is paid by the bank. Following a 2018 Supreme Court controversy and subsequent legal reform, the lender — not the borrower — pays the AJD on the mortgage deed itself. You still pay AJD on the purchase deed.
• Reduced AJD rates exist in several regions for young buyers, large families, primary residences below a price threshold, or buyers with disabilities. These almost always require Spanish residency and a primary-residence declaration — most foreign second-home buyers will not qualify.

Always check the current AJD rate with the tax authority of the specific *comunidad autónoma* where the property sits. A rate that applied last year in Andalusia may not be the rate today.

Who Pays What at Closing

On a typical new-build purchase, the buyer pays:

• IVA (10% residential / IGIC in the Canaries) — to the developer, who remits it to AEAT.
• AJD — paid to the regional tax authority, usually via your gestoría or abogado shortly after signing.
• Notary fees for the escritura.
• Land Registry (Registro de la Propiedad) fees to record the deed.
• *Gestoría* fees if you use one to handle filings.
• Legal fees for your independent abogado — budget around 1% of the price plus VAT as a working figure, and get a written quote.

The developer pays the plusvalía municipal on the land value gain (in practice — though contracts sometimes attempt to shift this; read carefully). The developer also handles their own corporate income tax on the sale.

Rough total closing costs for a new-build: plan for roughly 12–14% on top of the purchase price, dominated by the 10% IVA. Resale buyers in many regions pay similar or slightly different totals depending on the ITP rate.

Off-Plan Purchases: IVA on Staged Payments

If you're buying off-plan, IVA is charged on each stage payment as you make it, not just at handover. Your contrato privado de compraventa should clearly break out:

• The net price.
• The IVA on each instalment.
• Bank guarantees (aval bancario or insurance policy) for your deposits under Law 20/2015 — non-negotiable; never wire deposit money to a developer without one.

At final delivery and escritura, the AJD is paid in one go on the full deed value.

Common Pitfalls for Foreign Buyers

• Assuming the listed price is "all-in." It almost never is. Ask whether the price is IVA incluido in writing.
• Confusing IVA with ITP. If a developer tries to charge you ITP on a new-build, or vice versa, something is wrong — escalate to your abogado.
• Missing the AJD deadline. AJD must typically be self-assessed and paid within 30 business days of the deed. Late filing triggers surcharges. Your gestoría normally handles this.
• Buying a "new" home that's legally a resale. If the developer occupied or rented the unit for over two years, the sale flips to ITP. The economics — and the tax — change.
• Ignoring the NIE. You cannot pay these taxes without a Número de Identidad de Extranjero. Apply early.
• Trusting the developer's lawyer. Use your own independent *abogado* — never the one introduced by the seller.

Short FAQ

Can I reclaim IVA on a new-build home? Generally no — IVA on a personal residence is a final cost. IVA on commercial property bought through a Spanish company (e.g., an SL) for taxable business activity may be recoverable. Speak to a Spanish asesor fiscal.

Is AJD deductible against future capital gains? Yes — both IVA and AJD form part of your valor de adquisición and reduce your taxable gain on eventual sale. Keep every invoice and the escritura.

Do non-residents pay a different rate? The IVA and AJD rates themselves are the same regardless of residency. However, reduced AJD rates for primary residence almost always exclude non-residents.

What if I buy through a company? Buying through a Spanish or foreign company changes the IVA treatment significantly and may allow VAT recovery, but introduces corporate tax, Modelo 720 reporting, and other obligations. Get specialist advice before structuring.

The Bottom Line

For a new-build in mainland Spain in 2026, expect 10% IVA plus regional AJD of roughly 0.5–1.5%, plus notary, registry, and legal fees — together adding around 12–14% to the headline price. The exact AJD depends on the comunidad autónoma, and the Canaries use IGIC instead of IVA.

Tax rules and rates change. Before you sign anything, confirm current figures with the Agencia Tributaria, your regional tax office, and an independent licensed Spanish *abogado* who represents only you. The cost of good advice is a fraction of the tax you're about to pay.