At the time we took on your house for sale, we explained to you that when you sell your house, you are required to pay capital gains tax on any profit you make on the sale.

Foreign non-residents pay 18% on the profit from the sale. On the day of completion, you will be charged 3% on the full declared sale price - this is part payment of the 18% to be paid on the profit.

Foreign residents are also required to pay 18% tax on the profit from the sale. This amount is declared in your following year's tax declaration. If within 2 years of the sale you invest all of the proceeds from the sale into another primary home in Spain, you will not have to pay this tax. If you do not then you will pay 18% on what is not spent on your next home.

Both foreign residents and non-residents can deduct from the profit of the sale of their house amongst other things the costs for buying the house including taxes, notary and registry fees and lawyers' fees.

* Previously, in the case of non-residents the tax office has rarely enforced the payment of the difference between the 3% paid on the day of completion and the 18% owed on the profit. However, in view of the current worldwide economic climate, the Spanish tax office has recently started to require payment of this balance.

We feel that it would be advisable when you sell your house that you put aside enough money to cover this amount following completion as you might be pursued by the tax office even if you are going back to the UK.

Further information can be found on our website by following this link

http://www.sunsetproperties-spain.com/info/selling-guide/selling-costs,49.html

This information is merely a guide and we do strongly recommend that you consult your lawyer, asesoria or fiscal adviser with regard to your own particular circumstances.