A Spanish villa is not the same legal object to a UK buyer as it is to a Swiss one. It is not even quite the same object to two UK buyers, depending on what they intend to do with it. Foreign buyers of Spanish property — and at the €5M+ level virtually all buyers are foreign — routinely accept frictions they could have planned around. Three in particular cost them money on every transaction.
I. Notary timing.
In Spain, the notary represents the act, not the parties. The notary is the moment of completion; once the deed is signed, ownership transfers. What this means in practice: the financial readiness of the buyer must be perfect on the day. Bank transfers from foreign accounts that "should arrive Monday" but do not arrive until Wednesday — a routine condition in cross-border banking — make for an expensive Tuesday. We have seen buyers lose a 10% deposit because of a SWIFT delay nobody planned for.
The fix is unglamorous: fund a Spanish escrow account a week before completion, not the day of. Most buyers don't, because their lawyer is focused on the contract and their banker on the wire. We hold this calendar separately for every transaction we run.
II. Hacienda reporting.
When a foreign buyer pays for a Spanish property, the Spanish tax authority (Hacienda) takes interest in two things: the source of the funds (anti-money-laundering) and the buyer's ongoing status (non-resident income tax, wealth tax, and where applicable, the imputed income on a property held but not let). The first is handled at completion; the second is forgotten.
A foreign owner who does not file Modelo 210 — or who files it incorrectly — accumulates exposure that surfaces only at sale or estate transition. By then the cost is multiples of what proper annual filing would have cost. We brief on this at the start, not the end.
III. The structuring jurisdiction.
A €15M villa held personally is taxed one way; the same villa held through a Spanish SL is taxed another; through a Luxembourg holding, a third; through a UK property unit trust, a fourth. The right structure depends on three things: the buyer's tax residence, the intended use (residence, rental, family transfer), and the expected hold period.
The premium that the wrong structure imposes is rarely visible at purchase. It surfaces as an extra 1.5% on capital gain at exit; or as an additional Spanish wealth tax annually; or as 36% non-resident income tax on rental that could have been 19%; or as the inability to leave the asset cleanly to children. We do not provide structuring counsel ourselves — but we will not let a buyer purchase before they have engaged it.
None of these three is dramatic. None makes the press. Each quietly costs about one to two per cent of asset value, every time, on every deal where it is overlooked. Together, on a €15M acquisition, that is between four and six hundred thousand euros — saved by counsel that costs a fraction of that, engaged before the offer.