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Property Taxes and Costs

When buying a property in Andorra you will need to count with following charges:

– 4% purchase tax if the seller is a private person and 4.5% if the vendor is a company or a professional real estate developer.
– Notary fee is about 0.5 to 1% of the purchase price.

Since 2007 there is a law to restrict speculative property purchases.
The period between purchase and sale of real estate determines the rate of capital gains tax which is to be paid:

If the sale is produced within 12 months after purchasing one pays 15% on capital gains
Within 2 years, 14%
Within 3 years, 13%
Within 4 years, 12%
Within 5 years, 10%
Within 6 years,   8%
Within 7 years,   6%
Within 8 years,   4%
Within 9 years,   2%
Within 10 years, 1% and after 10 years it reaches zero.

An inflation adjustment is applied between the time of purchase and sale of the property.
In certain cases, when one meets the requirements, one can ask for dispensation, when as e.g. reinvestment in Andorra.

Prime Properties can advise you on this.