Buying in Málaga vs the UK: costs and taxes

Málaga is simpler to buy into than England, but it keeps sending you tax bills for as long as you own the place without living in Spain. The UK hits harder on the way in if you already own a home elsewhere.

The short version

Anyone can buy in Spain, British passport or not. Owning a flat doesn't give you any right to live there, though; outside residence you're on the 90/180-day rule.
A resale home in Andalusia pays a flat transfer tax (ITP), currently around 7% [10]. On a EUR 360,000 flat that's roughly EUR 25,200 (about £21,000); your abogado or notary will confirm the rate on the day.
Back home, a £300,000 house costs £11,000 in stamp duty if you buy while living abroad, and £26,000 if you also keep your Málaga flat, thanks to the 2% non-resident surcharge and the 5% higher rate for additional homes [1].
Non-resident owners in Spain pay tax every year on notional income from a home they don't let, at 24% for UK residents [8], on top of the council's IBI [9].
Sell in Spain and the gain is taxed there first at 19%, with 3% of the price held back by the buyer [7]. Sell in the UK as a non-resident and you report to HMRC within 60 days [4].

Pound conversions use the Bank of England spot rate of 5 November 2026 (£1 = EUR 1.20).

What a Brit can buy in Málaga, compared

Spain doesn't care whose passport you hold when you buy. A Brit can own a flat in Soho or El Palo, a townhouse in the hills above Churriana or a villa outside Mijas outright, with no approval, no quota and no foreign-buyer surcharge. You need an NIE number, a Spanish bank account helps, and you need your own independent lawyer, because the notary checks the deed, not the house. Our guide to buying on the Costa del Sol covers the process and the illegal-build traps.

Spanish ownership is generally outright. Flats sit in a comunidad de propietarios, the owners' community, which sets the service charge and votes on works. That's closer to commonhold than to an English leasehold: there's no freeholder, no ground rent and no lease ticking down.

Back in the UK, anyone can buy too. The difference is the tenure. Most English and Welsh houses are freehold, but most flats are leasehold, with a lease, a freeholder and service charges you don't control. A flat in Málaga can feel more like owning a house than a flat in Manchester does.

One thing to keep an eye on: Spain has floated much heavier taxes on non-EU buyers who don't live in the country. As far as we could find, that's still a proposal, not law. Check the position before you sign.

Upfront costs side by side

We've used a EUR 360,000 resale flat in Málaga and a £300,000 house back home, which are about the same money at our exchange rate.

	Málaga (resale flat, EUR 360,000)	England (house, £300,000)
Foreign-buyer surcharge	None	2% surcharge if you weren't in the UK for 183 days in the 12 months before buying [1]
Main purchase tax	ITP at a flat rate of around 7% on the whole price: roughly EUR 25,200 (about £21,000) [10]	SDLT in bands: £5,000 at standard rates [1]
Buying while living abroad, no other home	Same flat rate	£11,000 [1]
Keeping or buying another home anywhere	Same flat rate	£20,000 if you're UK resident, £26,000 if you're also non-resident [1]
New build instead	IVA, usually around 10% on a home, plus stamp duty (AJD) of around 1.2% [10]	Same SDLT as a resale
Lawyer, notary, registry	Lawyer often around 1% plus IVA; notary and registry on official scales	Solicitor or conveyancer, searches, Land Registry fee
Survey	Optional, not standard	Optional, but usual

The surprise for Brits is that in Spain a second home costs the same to buy as a first one, and the flat rate bites from the first euro. In England the band structure is gentle on a modest first purchase, then the surcharges stack. The 5% higher rate looks at residential property you own anywhere in the world, so a flat in Málaga worth £40,000 or more counts when you buy back home [1]. If you're non-resident when you buy and then spend 183 days in the UK within the following year, you can claim the 2% back.

All in, budget roughly 8% to 10% on top of the price for a Málaga resale. On a new build from a developer, IVA plus AJD at the usual rates on EUR 360,000 comes to roughly EUR 40,000 (about £33,500) before fees; check the current rates with your abogado.

Scotland and Wales do their own thing. Scotland charges Land and Buildings Transaction Tax with a flat Additional Dwelling Supplement on second homes, and Wales charges Land Transaction Tax with its own higher rates. Neither has a 2% non-resident surcharge.

Financing: Spanish bank or UK lender?

In Spain, banks lend to non-residents, but usually less of the price than they'd lend a resident, and with stricter checks on income earned in sterling. Expect to find a bigger deposit plus the purchase costs, which Spanish banks generally won't fund. If you'll repay a euro loan from a pension or salary in pounds, the exchange rate becomes part of your monthly payment.

Back home, a UK mortgage while you live in Spain is doable but narrower. Many high-street lenders won't count foreign income, specialist and private-bank lenders will, and you'll usually need a bigger deposit than a UK resident would. Buy-to-let deals typically want at least a quarter down. Our guide to UK mortgages for Brits living abroad explains the foreign-currency loan rules.

Owning it: property tax and running costs

In Málaga, you pay IBI, the municipal property tax, on the property's cadastral value, which is usually well below what you paid. Málaga's 2026 rate for urban property is 0.451%, the lowest of the eight Andalusian capitals [9]. As an illustration, a flat with a cadastral value of EUR 150,000 would pay about EUR 680 a year (about £565). Add community fees, rubbish collection charges and insurance.

Then there's the bit that catches Brits out. If you're not tax resident in Spain and the home isn't let, Spain taxes you on imputed income: 1.1% or 2% of the cadastral value, depending on when the town's values were last revised, taxed at 24% for residents of non-EU countries such as the UK (EU residents pay 19%) [8]. On that EUR 150,000 cadastral value, that's roughly EUR 400 to EUR 720 a year (about £330 to £600), filed on form 210. Let it out and you pay non-resident tax on the rent instead.

In England, you pay council tax by valuation band. Since 1 April 2025 councils can charge a premium of up to 100% on second homes, and most do: 211 of 296 authorities applied it in 2025, all at the full 100% [2]. So keeping a UK house empty while you're in Málaga can mean double council tax.

Letting your UK home brings in the Non-Resident Landlord Scheme. If your usual home is abroad, your letting agent (or a tenant paying more than £100 a week) takes basic-rate tax off the rent each quarter unless HMRC has approved you to receive it gross [3]. You apply on form NRL1, and you still file a Self Assessment return. See our guide to renting out your UK home.

Tax when you sell

The Spain side

Spain taxes a non-resident's gain on Spanish property at 19% [7]. The buyer must hold back 3% of the price and pay it to the Agencia Tributaria on form 211 within a month; you then declare the actual gain on form 210, and the 3% counts against the bill, with any excess refunded [7]. So on a EUR 420,000 sale, EUR 12,600 (about £10,500) goes to the taxman before you see the money. A EUR 60,000 gain would cost EUR 11,400 (about £9,500).

The town hall also charges plusvalía municipal on the rise in land value, usually paid by the seller. If you've moved to Spain and the flat is your main home, Spanish residents get different rules, including reinvestment relief; a tax adviser who knows both countries can check your case.

The UK side

Selling a UK home while you live in Spain. Non-residents pay UK capital gains tax on UK property, and you must report every sale to HMRC within 60 days of completion, even with no tax to pay or a loss [4]. For 2025/26 and 2026/27 the rates are 18% and 24%, depending on your UK income, and the annual exempt amount is £3,000 [5]. Private residence relief can still cover the years you lived there, but it's general information and the rules for years abroad are tight. Our guide to selling UK property as a non-resident walks through it.

Selling the Málaga flat once you're back in the UK. UK residents pay capital gains tax on gains anywhere in the world. For land and buildings abroad, HMRC says you may pay tax in both countries and claim relief in the UK [6]. Under the UK–Spain double taxation convention, Spain taxes the gain first, and the Spanish tax is normally credited against your UK bill. Because the UK and Spanish rates are close, the result is often a modest top-up to HMRC rather than two full bills. Work out the gain in pounds, using the exchange rate on the purchase date and the sale date.

Which makes sense for whom

Wintering in Málaga, home base in the UK. A flat can work, but price in the yearly non-resident tax, the 90/180-day limit and the fact that it makes any later UK purchase an "additional" home for stamp duty.
Moving to Málaga for good. Selling the UK house first keeps things clean: one home, Spanish resident rules, and no second-home council tax. Report the sale to HMRC within 60 days.
Keeping the UK house as a let. Fine, but sort the NRL1 before the first rent arrives, and check your mortgage allows letting.
Planning to come home in five years. Renting in Málaga keeps your options open, and buying back in the UK as someone with no other home avoids the 5% higher rate.

Buying abroad is a bit of a minefield. Ask around in our community group for Brits in Spain, where someone will have bought on your street and can tell you about the lawyer, the bank and the comunidad.

Buying in Málaga vs back in the UK: ITP, IBI and the taxman on both sides