Tax reliefs on sale of Spanish property

The recent tax changes in Spain have been widely reported. There was a massive drop in the CGT rate for non Spanish residents which came about due to the EU getting involved and not liking the fact that Spain taxed residents at 18% but non residents at 35%. This is obviously a bonus for non Spanish residents, particularly if there domestic tax rate is less than 35% as this means they'll see a real tax saving if they sell Spanish assets. This though focuses attention on other aspects of the Spanish CGT legislationm particularly the rollover relief. This is available when another Spanish residence is purchased and allows the gain on a disposal of a property to be deferred. This though is only available to residents - what do you reckon the chances are of this being challenged by the EU on the same 'discriminatory' basis that the Spanish tax rates were. Although it's application would be much less widespread than the rate drop it could still be potentially useful to a non resident providing they could show that the Spanish property was their main residence. Click here for details of our article on buying Spanish property.