Can Property in Spain be Purchased through a Foreign Company?

Investing in property in Spain, particularly in prime locations such as Altea, Albir, La Nucía and the Costa Blanca, is increasingly attractive to international buyers.

A question we are frequently asked at ALTEALEX is: Can I buy property in Spain through a foreign company?

The answer is YES. However, the decision involves important legal, tax, and practical considerations that must be carefully evaluated. The real question is not whether it is possible, but whether it is appropriate, efficient, and legally sound in your specific case.

Yes. Spanish law allows both individuals and companies whether Spanish or foreign to acquire property in Spain. This means you can buy a property through:

• A company registered in your home country
• An offshore company
• A Spanish company

However, legality does not always mean suitability. The key question is not “can you do it?” but “should you do it?”

There are several reasons why international investors explore this structure:

✔ Asset protection: Separating personal assets from investments.

✔ Privacy: In some jurisdictions, ownership may be less publicly visible. However, under Law 10/2010 on the Prevention of Money Laundering, financial institutions and notaries must identify the ultimate beneficial owner behind the purchasing entity. This means that the individuals who ultimately control the company must be properly identified during the transaction.

✔ Investment structuring: Particularly for portfolios or multiple properties.

✔ Corporate ownership flexibility: Facilitating future transfers of shares instead of property.

✔ Estate and succession planning: These advantages only apply in specific circumstances and must be evaluated with precision.

This is where professional advice becomes essential. In recent years, the legal framework governing property transactions in Spain has evolved significantly.

Tax transparency legislation and anti-money laundering regulations now form a central part of the legal environment for property acquisitions.

Buying through a foreign company can trigger:

– Higher taxation: In some cases:

• Additional taxes may apply
• Less favourable tax treatment compared to individuals

– Annual tax obligations: Companies owning property in Spain must:

• File annual tax returns
• Declare income or imputed income
• Comply with Spanish tax regulations

– Anti-avoidance rules: Spanish authorities closely monitor structures designed primarily to reduce tax.  Incorrect structuring can lead to:

• Penalties
• Additional tax assessments
• Legal complications

– Increased administrative complexity: Owning through a company involves:

• Continuous legal compliance
• Accounting and administrative requirements
• Legal oversight

Legal due diligence in Spain is no longer limited to verifying ownership title or checking charges at the Land Registry. It now requires a broader and more sophisticated analysis, including:

• Tax compliance obligations
• Anti-money laundering requirements
• Source of funds verification
• Cross-border regulatory implications

In other words, ensuring that the transaction can proceed smoothly from a regulatory perspective is just as important as verifying the property itself.

Purchasing through a foreign company may be appropriate when:

• You are acquiring multiple properties as an investment
• You require a corporate structure for asset management
• You have received specific tax advice tailored to your situation

It is generally not recommended for standard residential purchases without a clear strategic reason.

In many cases, particularly for private buyers:

• Single residential purchases
• Holiday homes
• Lifestyle investments

A company structure may introduce unnecessary complexity and cost.

At ALTEALEX, we often see buyers:

• Setting up structures without proper legal advice
• Relying on advice not adapted to Spanish law
• Assuming tax advantages that do not apply
• Underestimating compliance obligations
• Creating unnecessary complexity

These mistakes can be costly and difficult to correct later.

As a law firm specialising in property transactions involving foreign nationals, we provide a comprehensive approach:

✔ Legal and tax assessment: We analyse whether buying through a company is suitable for your case.

✔ Structuring advice: We guide you on the most efficient and compliant ownership structure.

✔ Full transaction support: From due diligence through to completion, ensuring legal certainty at every stage, and assisting with the incorporation of a Spanish company where appropriate.

✔ International client expertise: We regularly advise buyers from across Europe and beyond. We have been involved in over 3,000 property transactions, some of which have been carried out through companies based in Spain and other countries

• Over 45 years of experience
• Deep knowledge of Spanish property, corporate and tax law
• Proven track record with international investors
• Discreet, professional and results-driven approach

Before deciding how to structure your purchase, it is essential to understand the legal and tax implications.

At ALTEALEX, we provide a clear, tailored and confidential assessment to help you make the right decision.

Contact us today for a consultation