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To purchase a Car in Spain, you will need to produce certain documentation, this includes confirmation of your address such as the Escritura (property deed), or a rental agreement for where you live in Spain as well as, your N.I.E number and Passport.
If you are buying a new car in Spain, from a dealer, they will normally organise all the paperwork for you, but you will have to pay any transfer tax and fees. If purchasing a second hand car in Spain then you need to ensure all the paperwork is handled correctly to avoid incurring fines.
The vehicle seller should provide you with the impuesto sobre la circulación de vehiculos (car tax) and the tranferencia. Most people will use a Gestor to organise the paperwork for them although this will incur you a fee. We would recommend taking a note of the vendors NIE number or copy or tarjeta de residencia or passport for your own peace of mind and it can also be used to check signatures. You should also ensure the inspection technical de vehiculos is current (ITV) This is the Spanish equivalent of the UK MOT and all cars over 4 years old must have had an annual ITV test. There is a time limit of 15 days to register the car in your name.
Most people use a Gestor (Spanish solicitor), to organize the paperwork for them.
If you have an EU licence, such as, the Full UK licence, then you can use that license to drive a vehicle in Spain. You cannot obtain a Spanish driving licence without a residencia (residents permit). Whilst it is not necessary to obtain a Spanish licence, strictly speaking, you should carry a translation of your licence in Spanish, just in case you are stopped by the police. This can be obtained from the Real Automovil Club de España. Alternatively, you can obtain an international driving licence from your home country before leaving for Spain.
If you decide to become a full time resident of Spain you should change your license to a Spanish license. You can arrange to show your current EU licence and your tarjeta de residencia to the relevant trafico office and complete the relevant form.
The alternative is to exchange your current driving licence for a Spanish licence. In order to do this you must provide copies of your passport, your driving licence, tarjeta de residencia and the relevant form from Trafico (spanish traffic police), completed. The process can often take several days to complete.