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Financial Dictionary - Stamp duty
Stamp duty
Stamp duty (AJD, for the Spanish acronym) is often known as the mortgage tax. It is applied to notarised deeds legalising the commercial and administrative documents involved in mortgage loans.
Worried about the extra costs? Use our mortgage cost calculator to find out all the extras involved in buying a property: deed, taxes, notary, etc.
Stamp duty is regulated by Legislative Royal Decree 1/1993, of 24 September, under the Property Transmission Tax and Stamp Duty Act.
This tax is an extra expense for home owners and natural or legal persons interested in buying and selling houses, premises and other types of property. This tax can represent up to 70% of all the mortgage expenses, depending on the price of the property.
What is the percentage rate for stamp duty?
When you buy a home in Spain, the percentage payable depends on the autonomous community where the loan is arranged. The percentage is usually between 0.5% and 1.5% of the sale price.
Communities with higher rates (1.5%) include Andalusia, Aragon, Valencia, Castile and León, Catalonia, Galicia and Murcia.
At the other extreme, communities such as Ceuta, Melilla, Navarre and the Basque Country charge 0.50%.
In between these extremes, we have: Castilla-La Mancha, 1.25%; Asturias, the Balearic Islands and Extremadura, 1.2%; the Canary Islands, Cantabria and La Rioja, 1%; and Madrid, 0.75%.
Stamp duty rates by autonomous community:
Andalusia
1.50%
Aragon
1.50%
Asturias
1.20%
Balearic Islands
1.20%
Canary Islands
1.00%
Cantabria
1.50%
Castile-La Mancha
1.25%
Castile and Leon
1.50%
Catalonia
1.50%
Ceuta
0.50%
Valencia
1.50%
Extremadura
1.50%
Galicia
1.50%
Madrid
0.75%
Melilla
0.50%
Murcia
1.50%
Navarre
0.50%
The Basque Country
0.50%
La Rioja
1.00%
There are usually reductions or even exemptions from this tax on mortgages to facilitate access to housing for certain groups, such as large families, young people and people with disabilities.