Properties in Spain can be jointly owned for a number of people. This co-ownership is known as “condominio” or “propiedad en condominio”.

However, there are cases where one of the joint owners wishes to terminate the community/“condominio” by buying their portion (%) or selling their portion (%) to a co-owner. This is known as Dissolution of Joint Property Ownership (DJPO), which in Spanish is translated as “Extinción de condominio”.

Dissolution of Joint Property Ownership (DJPO) is a special procedure in Spain which saves 80% in taxes (approx.)


Dissolution of Joint Property Ownership (DJPO) consists on assigning an asset or property that belongs to several owners (co-owners), who agree to sell it to one of them. The other joint owner/buyer has to pay a price for gaining the share (%) that belonged to the others.

DJPO implies the end of joint ownership by transferring the asset to a single individual (100% ownership). It can only be applicable to assets belonging to several owners who decide to sell it to one of them.

Therefore, it cannot be applicable when the transfer goes to more than one owner (i.e.: if there are three joint owners and two of them keep the other one’s share).


  • Dissolution of Joint Property Ownership is suitable:
    • When a couple breaks off and one of them wants to adquire the portion (%) of the ex partner.
    • When heirs of a heritage own a property and one of the heirs buys the portion of the other heirs.
    • When partners, colleagues, friends or family own a property and one of them buys the portions of the others members.

Therefore, both parties (buyer and seller) have to be owners of the property and they both decide to finish the co-ownership.

There are cases where a property is affected by a mortgage, in this particular case, the lender (bank) has to agree the DJPO and attend the Notary meeting in order to liberalize the owner from his mortgage duties.


DJPO offers one main advantage: the tax paid by the buyer to achieve this share of the property is significantly lower than a sale.

On buying resale property in Spain, a buyer is normally liable for Property Transfer Tax (Impuesto de Transmisiones Patrimoniales (ITP) which ranges between 7% to 10% (the % varies depending on the region in Spain where the property is located as it is a regional tax). However, by following Dissolution of Joint Property Ownership a buyer only pays 1.5% Stamp Duty (AJD – Actos Jurídicos Documentados).

Therefore, this special legal procedure to re-arrange holdings saves buyers a considerable amount in taxes.


The DJPO follows the same legal procedure as if you were buying or selling a property. Therefore, the process will be completed by signing a deed of Dissolution of Joint Ownership before a Spanish Notary Public who will witness it.

Once the Notary´s deeds are signed, the registration of the deeds at the Land Registry is essential in order to legally lodge the new awarded share in ownership of the property.

Therefore, a DJPO has associated identical expenses as a orderly conveyance, however, the tax paid by the buyer is undoubtedly lower than in a purchase (approximately 80% less).

As previously said, if the property is mortgaged, agreement from a lender (bank) is needed to approve a deed of dissolution.


It is important to highlight the fact that before October 2018 the tax of 1.5% was paid on the entire value of the property when the share transferred was just 50% of the property.

Thanks to a Sentence of the Supreme Court of Spain of 9th October 2018 the tax will only be paid according to the value of the share effectively being transferred which means a massive tax saving.

Stamp Duty is a devolved tax of Spain’s 17 different regions. Each region is allowed to settle the tax rate within a range between 0.5 and 1.5%. For instance, in Andalucia or Comunidad Valenciana, the tax is 1.5%.

  • We include an example of Dissolution of Joing Property Ownership:
    • A couple who has been divorced.
    • They own a property in equal shares (50% husband – and 50% wife) in Alicante.
    • The property worth is €100,000.00.
    • The husband wants to buy the 50% of his ex-wife´s ownership.
  • Before October 2018: The husband-buyer paid 1.5% Stamp Duty on the full property value, so €1,500.
  • After October 2018: The husband-buyer pays 1.5% Stamp Duty on the % that he buys (50%), so €750.

Moreover, there are some other additional expenses for the buyer:

In addition to the 1.5% Stamp Duty (AJD), there are some expenses associated to the process, which are common to any sale or purchase:

  • Notary fees: €400 – €600
  • Land Registry´s fees (*): €250 – €400
  • Lawyer´s fees

(*) The registration of the deeds at the Land Registry is essential in order to legally lodge the re-arranged share in ownership of the property.

Regarding the expenses associated to the vendor/seller:

The seller will only pay Capital Gains Tax (known as Plusvalia) on the outgoing share. If you want to know more about Plusvalia, do not hesitate to read this link.

If the vendor is non-resident, 3% retention is practiced on the outgoing share which will be paid into the Tax Office as per Law. The vendor, depending on whether he/she makes a profit or a loss, may be due a tax rebate on the amount.


If one of the co-owners refuses to sell his share, it is when a contentious DJPO should be applicable. This process is known as Forced Dissolution of Joint Property Ownership and it is advisable only as last resort.  

Forced Dissolution of Joint Property Ownership should be used when parties do not come to an agreement with the co-ownership property sale.

We do not recommend to follow Forced Dissolution of Joint Property Ownership as the result of the public auction may not be as beneficial as thought.  

REUTERS SOLICITORS can help you to process your Dissolution of Joint Property Ownership without any need for you to fly over to Spain by granting a Power of Attorney to your lawyer.

Our service includes:

  • Consultation and detailed description of the procedure, solving all the questions from the client/s.
  • Prepare the Power/s of Attorney (if necessary) 
  • Preparation of all documents required for DJPO.
  • Making preparations at the Notary.
  • Registering updated Title deeds.
  • Filing and paying associated taxes.
  • Clearing off mortgage at the property (if applicable).

Do not hesitate to contact us for more information.

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