Any business transaction becomes more complex when it is done internationally; not only do you need to worry about a whole other set of laws and regulations, you may also have to meet a series of requirements that would not apply to citizens of that other country. Both buyers and sellers of real estate in Spain have their respective legal responsibilities, due diligence and tax obligations. Furthermore, when talking about real estate for business purposes—whether commercial real estate or investment property in Spain—there is so much at stake that you really need a team of legal professionals on your side to protect your interests.
Buying commercial real estate in Spain
While there are no restrictions per se on foreigners owning real estate in Spain, you may have to file a variety of forms depending on the source of funding for the purchase and on the location and type of property to be purchased. Also, your documentation requirements will differ if you are buying commercial real estate in Spain as a natural person or legal person. In both cases, you must go through the process of registering for an identification number, a NIE for individuals and a CIF for non-individual legal persons, such as business entities.
As a buyer of real estate in Spain, you are afforded certain legal protections against the seller and property developer. It’s important to understand your rights and responsibilities to prevent any problems down the road. It is your job to confirm, for example, that the property you are going to buy is environmentally suitable for the business activities you plan on carrying out there.
Investment property in Spain
Real estate investment in Spain is on the rise now that prices have stopped falling, and the country should no longer be considered a risky option for investors. If you are considering buying an investment property in Spain, you need to be aware of the various structures used to accomplish this. A legal service with experience in Spanish real estate law for businesses can help you choose the most advantageous investment procedure.
In the case of commercial real estate and investment property in Spain, there is also the matter of tax liability. When a property purchased with the intention of business activity, it is usually subject to VAT (value added tax). If the buyer is able to deduct this VAT, it may be beneficial to have the seller waive their VAT exemption and invoice the buyer for that VAT. Other taxes that may apply are transfer tax, stamp duty, and standard property taxes.
Finding a property for sale in Spain
When it is time to find a property in Spain, there are a number of factors that need to be considered. Firstly, each of the country’s autonomous communities may impose different rates on certain taxes that are relevant to commercial real estate transactions. There is also the matter of whether the property requires military authorization because it is in a sensitive area, or if any local environmental restrictions are in force. In short, the old adage “location, location, location” rings truer than ever.
Once you find a property for sale in Spain, you must provide documentation verifying your identity and bank account details, and you may be subject to anti-money laundering procedures. Before you enter into a contract with a seller, it is always advisable to have it reviewed by a real estate lawyer. This will also be immensely helpful if there are problems later because the seller breaches the contract.
When it comes to your business, you have plenty to worry about without having to get into the complexities of Spanish commercial real estate and investment property legislation. Protecting yourself, your business and your assets when buying real estate in Spain is much simpler when you have an experienced attorney on your side making sure all of i’s are dotted and t’s are crossed.