Buying real estate with cryptocurrency in Spain: how it works
Buying real estate in Spain using cryptocurrency is a process that is becoming increasingly common, especially among foreigners. Buying real estate in Spain with cryptocurrency is a completely legal and transparent procedure, provided that all legal requirements are met. Below, we will consider how the transaction is processed, the calculation process and taxation are carried out.
Transaction processing.
The process consists of transferring funds from the buyer's crypto wallet to the seller's crypto wallet. In this case, it is necessary to verify the source of origin of the funds, confirm the authenticity of the crypto wallet and provide a report from the exchange confirming the possibility of making the payment.
A real estate purchase agreement with cryptocurrency is possible through an agreement between the buyer and the seller. However, cryptocurrency as a form of payment is not considered an official means of exchange in Spain. This means that most often the cryptocurrency is either converted into euros before the transaction, or both parties agree on the form of payment in cryptocurrency and fix the exchange rate at the time of the transaction.
There are notaries who are ready to work with cryptocurrency, accepting it to their crypto wallet and converting it into euros on the day of signing the purchase and sale agreement. This method guarantees the security of the transaction, since the notary transfers the euros directly to the seller. However, it is important to consider that an additional commission may be charged for such services - usually 2-4% of the transaction amount. The official contract as a result is in euros, which avoids uncertainties associated with exchange rate fluctuations.
Taxes on the transaction.
Taxation when buying real estate for cryptocurrency in Spain is similar to standard transactions:
- Property Transfer Tax (ITP). Depending on the autonomous community, it ranges from 6 to 10% for secondary housing.
- VAT (IVA). When buying new real estate (for example, from a developer), you must pay VAT at a rate of 10% and stamp duty (1-1.5% depending on the region).
It is important to note that cryptocurrency transactions in Spain attract special attention from tax authorities as they require proof of the source of funds. This can make the process difficult for non-residents and investors if they do not have sufficient documentation.
Our company has experience in supporting cryptocurrency transactions and is ready to assist at all stages to ensure maximum protection of your interests and funds.