Private Real Estate Ownership in Ibiza: Freedom and Obligations
If you’re primarily planning to use the property for yourself – or perhaps rent it out occasionally – a private purchase is likely the simpler and more convenient option. The big advantage? You have much more freedom. No complex business structures, no extensive accounting obligations. Just a house in a dream location, where you can vacation whenever you want. But, let’s be honest: there are downsides too. In terms of taxes, you might miss out on some advantages that a business purchase would offer, like wealth tax and possibly higher rates on rental income. However, for those seeking peace of mind without too much hassle, private ownership remains an attractive choice.
Tax Differences Between Business and Private Purchase in Ibiza
This may well be the most important aspect to consider. Because from a tax perspective, there’s a world of difference between buying business or private real estate in Ibiza. If you purchase property through a business, you can benefit from tax deductions, depreciation, and sometimes even VAT refunds. But that also means more paperwork and stricter rules. Private ownership is simpler, but tax burdens can be higher, especially if you decide to rent the property. Wealth and income taxes can take a significant chunk out of your returns. It’s wise to consult a financial advisor to determine the best option for you.
