Buyer’s Q&A
Capital gains tax when you sell your fractional ownership share
Selling a fractional share can trigger capital gains tax in the property's country (and potentially the seller's home country) on any gain. How tax works depends on the country and the home's legal set-up, which our partner explains before you buy; we recommend independent advice.
The short answer: When you sell your share for more than you paid, capital gains tax applies to the gain — just as for any property — in the property's country, and potentially also in your home country, with double-taxation treaties preventing you paying twice. How tax works depends on the country and the home's legal set-up, which our partner explains before you buy — as well as on the seller's residency and any double-taxation treaty between the two countries. A cross-border tax specialist can model your position in advance, so you know your net proceeds before you list.
Full guide: Second-home tax by country: Spain, France, Italy, Portugal, Austria and Germany compared
The structural picture
Capital gains tax (CGT) on a fractional share sale operates at two levels. The property's country taxes the gain under its rules. The seller's home country may also tax the gain under its rules, with credit available for tax already paid in the property's country under the relevant double-taxation treaty.
Exactly how the gain is treated depends on the country and the home's legal set-up, which our partner explains before you buy. We recommend independent advice from a cross-border tax specialist.
How CGT is calculated
The gain is the sale price minus the original cost basis. The cost basis includes the original share price plus any documented capital additions to the property funded by special assessments during ownership. Sale-related costs (resale fee, legal fees) are deductible from the gain in most jurisdictions.
Worked example: a buyer who purchased a 1/8 share for €300,000 in 2026 sells for €360,000 in 2035 with €6,000 in sale costs. Net gain: €54,000. CGT applies to the €54,000 in the property's country and (with credit for that tax) in the seller's home country.
Country-by-country headline rates (illustrative)
| Property country | Headline CGT rate on share sale (non-resident) |
|---|---|
| Spain | 19% on the gain (with some indexation reliefs for older purchases) |
| France | ~36.2% (CGT + social charges), tapering with holding period; treatment depends on the home's legal set-up |
| Italy | ~26% on capital gains; treatment depends on the home's legal set-up |
| Portugal | ~28% for non-residents |
| USA | Long-term federal CGT 15-20% + state CGT (varies); subject to FIRPTA withholding |
| Mexico | ~35% on the gain; lower rates available with documented cost basis |
These are illustrative starting points. Actual rates depend on share-purchase date, holding period, the specific treaty position, and the seller's overall tax situation.
Holding-period taper relief
Some jurisdictions reduce CGT rates the longer the share is held — France's tapering relief, for example, reduces the CGT charge meaningfully for shares held 6+ years. Buyers planning to hold for the long term should factor this into the cost-per-night model.
The home-country tax position
UK CGT: applies to UK-resident sellers' worldwide gains, with credit for foreign tax paid. The UK rate (currently 24% on residential property gains for higher-rate taxpayers) is typically higher than the foreign-country rate, so additional UK CGT is usually due net of credit.
US capital gains: applies to US-resident sellers' worldwide gains. Federal long-term CGT 15-20% plus relevant state tax, with foreign tax credit available for foreign tax paid.
EU residents: most EU countries tax worldwide capital gains for their tax residents, with treaty credits.
What sellers should do before listing
Three things in order. First, gather the documentation that establishes cost basis (original share purchase paperwork, any special-assessment contributions). Second, engage the same cross-border tax specialist who advised on purchase (or equivalent) to model the CGT outcome before listing — so you know your numbers upfront. Third, factor CGT into the price negotiation when accepting offers.
If you sell below your purchase price
A capital loss may be deductible against other capital gains — a UK seller can typically offset it against other UK gains, and a US seller against other US capital gains. Keep the paperwork to hand.
Where to find listings with disclosed resale histories
Co-Ownership Property's selection includes both new and resale fractional listings with the resale status flagged.
Further reading
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