Paying the Deposit and Completion from Abroad

Paying the deposit and completion from abroad is the part of a Costa del Sol new-build purchase that trips up the most foreign buyers, because the money has to move across borders, clear Spanish anti-money-laundering checks and land in the right account on the right date. This guide explains how payments are structured on an Andalusian new build, how to get funds into Spain cleanly, what taxes and fees to budget for, and how to sign completion even if you cannot be in the country. It pairs with our related guides on taxes and costs when buying a new build, getting your NIE and opening a Spanish bank account, and non-resident mortgages.

How new-build payments are structured on the Costa del Sol

A new-build (obra nueva) purchase is paid in stages rather than in one lump sum, and understanding the sequence is the key to planning your transfers from abroad.

1. Reservation contract (contrato de reserva). A small holding deposit, commonly between 3,000 and 6,000 euros, takes the property off the market. This amount is normally deducted from the next payment. ⁶
2. Private purchase contract (contrato de arras / contrato privado). Signed within roughly 30 to 60 days of reservation. A payment of typically 10 to 30 per cent of the price is made on signature, with any reservation deposit deducted. ⁶
3. Stage payments during construction. On off-plan properties, further instalments are tied to construction milestones (foundations, structure, facade, finishes). ⁶
4. Completion (escritura pública and handover of keys). The outstanding balance, often 60 to 70 per cent, is paid at the notary on the day the title deed is signed and ownership legally transfers. ⁶

Because these dates are fixed in the contract, plan each transfer well in advance. International payments can take several days to clear, and a late completion payment can put you in breach.

Getting the money into Spain: bank account and source of funds

In practice, nearly all completion and stage payments are made from a Spanish bank account in the buyer’s name to the developer’s Spanish account. Opening a non-resident account is straightforward, though full operability can take a few days, so do it early. ⁵

Spain’s anti-money-laundering (AML) rules require the notary, the bank, the developer and the lawyer to identify you and verify the origin of your funds before completion. You will complete a Know Your Customer (KYC) form and provide documentary proof of where the money comes from: payslips and savings statements, the deed and settlement of a property you sold, or inheritance documents and the corresponding transfers. If the funds cannot be traced, the notary can refuse to authorise the escritura. ⁵

Practical tips for transfers from abroad:

• Keep a clean paper trail. Transfer from an account clearly in your own name and keep evidence of the source of every large deposit.
• Currency exchange is often better handled through a specialist FX provider than a high-street bank, but the receiving account should still be your Spanish one so the AML filter is applied.
• Send funds two to three working days before each contractual deadline to absorb interbank delays.
• Never pay the developer’s balance in cash. Spanish law caps cash payments and completion is settled by bank transfer or a banker’s cheque handed over at the notary.

What you actually pay: taxes and fees on an Andalusian new build

On a new build bought directly from the developer, the transfer tax (ITP) does not apply. Instead you pay IVA (VAT) at 10 per cent of the price, plus Actos Jurídicos Documentados (AJD, stamp duty) at the general Andalusian rate of 1.2 per cent, set by Decreto-ley 7/2021 and consolidated by Ley 5/2021. ¹² That is 11.2 per cent in tax alone before professional costs.

As a rule of thumb, foreign buyers should set aside roughly 12 to 14 per cent above the purchase price for taxes and fees, and more if there are furniture packages, parking and storage extras or mortgage set-up costs. ⁵ The AJD is also charged on the mortgage deed if you borrow, though since 2018 the lender pays that stamp duty, not the buyer.

Financing from abroad: non-resident mortgages

Spanish banks lend to non-residents but on tighter terms. Loan-to-value (LTV) for non-residents typically sits between 50 and 70 per cent, meaning a deposit of 30 to 50 per cent plus all the taxes and fees above. EU tax residents commonly reach 60 to 70 per cent, while non-EU buyers (for example UK, US, Middle East) are often capped nearer 50 to 60 per cent. ⁶ Terms usually run up to about 25 years and, for larger loans, are increasingly on variable rates linked to Euribor. ⁶

Because a mortgage adds valuation, arrangement and stamp-duty steps, start the application early and factor it into your milestone-payment plan. If you are financing part of an off-plan purchase, most of the loan is only drawn at completion, so the stage payments still come from your own funds.

Protecting your off-plan deposit: Ley 38/1999

Every euro you pay before the home is finished must be legally protected. Under the First Additional Provision of the Ley 38/1999 de Ordenación de la Edificación (which replaced the historic Ley 57/1968 after its repeal), a developer taking advance payments on an unfinished home must: ³⁴

• Guarantee the return of all advance amounts, including taxes, plus statutory interest, through a bank guarantee (aval bancario) or an insurance policy, if the home is not delivered on time; and
• Receive those amounts into a special, separate bank account used only for that development.

Before you transfer any off-plan instalment, ask your lawyer to confirm the guarantee or insurance certificate is in place and that you are paying into the correct special account. This is the single most important protection when buying off-plan, and it is your money at stake if the developer fails to deliver.

Signing completion when you cannot be in Spain

Two things make remote completion possible. First, you must have an NIE (Número de Identidad de Extranjero): it is mandatory for any foreign buyer, resident or not, and the notary cannot authorise the deed or the taxes without it. Apply for it well ahead of completion. ⁷

Second, if you cannot attend the notary in person, you can grant a power of attorney (poder notarial) to your Spanish lawyer, signed before a notary in your home country with an apostille, or at a Spanish consulate. Your representative then signs the escritura, pays the taxes and collects the keys on your behalf. Arrange the power of attorney weeks in advance, as translation and legalisation take time.

After completion: your ongoing taxes as a non-resident owner

Owning on the Costa del Sol as a non-resident brings two recurring obligations. IBI, the annual municipal property tax, is billed by the town hall (broadly around 0.4 to 1.1 per cent of the cadastral value depending on the municipality). Separately, you must file an annual Modelo 210 (IRNR): if the home is not rented, Spain imputes a deemed income of 1.1 or 2 per cent of the cadastral value, taxed at 19 per cent for EU/EEA residents or 24 per cent for non-EU residents. ⁷

One point about the well-known 3 per cent retention: it does not apply when you buy a new build from a Spanish developer. It applies later, when you sell, if you are then a non-resident: the buyer must withhold 3 per cent of the price and pay it to the Agencia Tributaria via Modelo 211 as a payment on account of your capital-gains IRNR. ¹ Keep that in mind when you eventually exit.

For the full breakdown of purchase taxes, see our guide on taxes and costs when buying a new build, and for the residency and account groundwork, our guides on getting your NIE and opening a Spanish bank account.