Spanish law has limits on cash transactions depending on the type and who they’re between. This is what you need to know if you want to buy a Spanish property with cash rather than via electronic bank transfer or cheque.
Yes, it is possible to pay part or all of the price of a property in cash in Spain, but there are limits.
Spanish legislation, specifically Law 11/2021, establishes restrictions on cash payments for transactions with the aim of combating fraud and increasing tax transparency.
Spain therefore has legal limits on cash transactions of almost all types above a certain legal threshold. It basically depends on whether the parties involved are natural or legal persons, tax residency, whether there is a professional or entrepreneur involved in the sale or whether it is a transaction between private individuals.
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For example, some people in Spain can pay up to €99,999 for the purchase of a house or a car, but for anything about €100,000 Spain’s Money Laundering Prevention Commission must be notified in advance.
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How much can pay in cash when buying a house in Spain?
According to Idealista, Spain’s leading property website, there are different limitations on cash transactions when buying a house in Spain depending on different factors.
For cash payments for property sales between private individuals: You can pay up to €99,999 in cash without having to give prior notice, but you must leave a record in the presence of a notary. From €100,000 onwards, the Prevention of Money Laundering Commission must be notified in advance by filing form S-1, the amount being €10,000 for movements of money or cheques or bearer bills of exchange entering or leaving Spain.
Paying in cash when buying or selling a property between professionals: If either of the parties is an entrepreneur (whether an individual or a legal entity), transactions for an amount equal to or greater than €1,000 may not be paid in cash.
If the buyer is a natural person (in other words, not an entrepreneur) and is not resident for tax purposes in Spain, he/she may pay in cash up to €10,000.
If the buyer is a natural person who is not acting as a businessman or professional and is resident for tax purposes in Spain, the seller (another private individual) may receive the amount from the sale of a house in cash, but proof of payment must be provided with a bank receipt, a receipt signed by the buyer or a document accrediting the origin of the money.
The receipt should be kept for a period of five years, as it may be required by the tax authorities to prove the legality of the transaction.
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