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Illegal or not . Wether you pay or not The Hacienda will take it from your bank account ! Try getting that back! Well in Almeria they would, I will never buy in this country again ,I am just in the process of selling my 7th property here and its my last
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It isn't just us British that have been stung with this 'Complementary Transmission Tax', 3 other neighbours of mine were hit too..all Spanish. There were 4 of us that bought from a bank, we all got hit with it...so unfair and would love to know IF this tax is illegal??
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We bought a year last November and received a tax demand as you did the middle of last year for nearly 8 k We appealed and won on 2 nd appeal which cost us 800 euro plus tax, it stinks really that you have to pay to defend an injustice and then on top of that pay tax You cannot gaurantee a win of course you just have to trust your solicitor to do a good job of the appeal Hope this helps
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The trouble is that sometimes it is difficult to know when you have received the correct information. We read in the newspapers a good while back that the taxman could not come after anyone for this tax after 5 years. can anybody confirm that????
_______________________
 Now Retired and have our money back in FULL via our bank guarantee. Bob and Pauline.
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I purchased an apartment in Malaga province in 2012. I paid 125,000€ and the 7% purchase tax required. In mid 2012 I had a demand from the tax people for 9,500 €....my solicitor said it was a re-valuation of the catastral value, based on a formula not many mortals could understand. They had said the re-vaaluation was 255,000€!!!! He told me the accepted thing to do was appeal, and get a re-valuation, this had to be done within so many days. He appealed on my behalf, and got a re-valuation of 155,000€ and therefore I had to pay them the reduced sum of 2,500€. Reluctantly, I said I would pay, he advised that the accepted course of action was to do nothing, the tax people would therefore think we had accepted the new valuation, and the sum would be deducted from my bank account by Christmas 2012. When January came and went, I contacted the solicitor and advised no money had been removed from my account, he dropped the bombshell...oh sorry, but I should have let the tax people know we had accepted the new valuation, as 'We' didnt, they have reverted to the original valuation of 255,000€ and now you owe them 10,500 €....including interest!... I stayed in Spain untill last October, thats when my Spanish bank account was embargoed as I didnt have that sort of money to pay the debt, so I came back to the UK. I have since written to my local MEP...he has written to the Spanish Ambassador in London, who basically said 'tough'....you have to pay my corrupt government your hard earnt money whilst we carry on squandering it....so, now I have a new solicitor, Spanish based in England, who is going to attempt to get some justice. ?.im not holding my breath! ,
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Our story is similar... we got a bill for 3000 euros as they considered that the house was undervalued. We made the initial appeal (and lost), and have followed the process of getting the house revalued and presented this to the Hacienda (cost to us so far, 1200 euros). We won't know the outcome for 12 - 18 months (!), but the new valuation was essentially the same as our purchase price, so we're hoping it will be accepted.
It seem incredible that whilst the Spanish government is trying to eradicate the 'black economy', they are willing to allow their local authorities to promote these dubious actions. What sort of a message does this send to the public?
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This is Spain doing what it does, getting as much money as posible from foreign property owners, buyers and sellers. Making up rules and laws to benefit the goverment. The country is in debt, the Banks are still in turmoil and they need money so this group is an easy target. I would you seek advise from lawyers who would be willing to help you. Yours gave you conflicting advise, so I would ditch them asap. You are paying, so you should expect a good service and help.
I agree with other posters who have had enough of Spain, a lovely country, but corrupt to the core. That's why even the Spanish are leaving, especially the young, who can blaim them. I wish you luck. Never again would I buy in Spain.
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This is unbelievable, and the first I have heard of it. I own in the Alicante region, buying an apartment in 2011. Yes it was reduced from when they were first marketed in 2006, by about 50% although we bought from a person who paid the same amount as us. So no black money. Mind you over 50% are still unsold from when the development was first built. This is a nightmare tax for people having bought in good faith.
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The value of the properties is taken off the ibi bill, it's the cat astral value and there is a way to calculate it. The lawyers should do this before you buy and tell you that you will probably get a bill for x amount. It is happening with all nationalities, spanish included. As of 2014 they have reassessed these values to match the market place so it should in theory stop happening now. It is a tax that I believe they will have to pay back, in 2006 they had to pay people back foreigners that they charged 35% capital gains and spanish 18% they had to give the foreigners the 17% back but only when the people claimed for it and as many did not know they never claimed. It is wrong and illegal I am sure but one of my friends tried to not pay it and lost the case and on his it was 25,000 euros he had to pay all because the cat astral values remained at the high prices of 2003. Everybody therefore was getting these bills.
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Why is this unjust and outrageous tax, now illegal, allowed to be applied?
I think its appalling that solicitors are telling their clients to put money aside for this tax, when they shouldn't be paying it anyway.
Why can't someone do anything?
Even if there is a petition to the EU it will take years , and Spain isn't known for sticking to the rules anyway.
Is Spain doing its best to put off people moving here, and hastening the exit of those who were contemplating leaving
What with the assets reporting law, and the abolition of inheritance tax allowancess in Murcia, this is the final straw.
I await Maria de Castro's advice and opinion on this.
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Info from internet:-
Before buying a property, you should enquire about taxes which will be due, from the Comunidad Autónoma (Regional Administration) where the property is registered. and about the valuation that the property has with the Administration- Then you will know what expenses the payment of taxes will mean for you, you will be able to plan on the tax. and most importantly, you will avoid the fear of getting a subsequent claim from the Tax Office.
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But surely you will still get an additional demand if the Hacienda has a different, higher valuation?
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As I read it, that is the valuation which Hacienda uses.
Any competent solicitor or notary can get the figure too.
In the 'bad old days' when lower values were declared than the actual sale price, one with any sense always checked what would be accepted, as the lowest price which could be declared, without getting a follow up tax bill..
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Why can't the Hacienfa accept that a person is selling it for a low price for a variety of reasons and accept the transfer tax accordingly.Why is it still acting on values which were much higher years ago, why haven't the values been adjusted according to today's low property prices? Iknow what you are saying but it is still unjust.
If this has been made illegal, why are they still being allowed to do it?
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Campo. From what I read, there has been an adjustment from Jan this year, so unless the value declared is far below reality, then there should not be any such surprises in the future. But as a I said for many years (maybe ‘forever’) the declared values have been way below reality.
That explains, "Why can't the Hacienda accept that a person is selling it for a low price for a variety of reasons and accept the transfer tax accordingly'.
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It all seems a bit pointless having a notary whose job it is to ensure the price paid was correct. In the bad old days the black money was "the way the Spanish do it". It now seems that people are being criminalised even though they have been through solicitors, notaries and the tax system.
I'm not sure but didn't kathyslad actually say the court hadn't ruled the demands "illegal" but that the tax office should carry out more checks before demanding money? In either case, it seems as if the tax people are completely ignoring the court ruling.
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It all seems a bit pointless having a notary whose job it is to ensure the price paid was correct.
I am pretty sure that is not part of his/her job.
But I have a mate who is a notary, so in years gone by when I was buying/selling I used to get him to check out the price I should declare. He could do it (on his computer) in a moment.
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You are correct John, it is not the Notary's job to ensure the price paid is correct. The Notary's job is to ensure that the parties are who they say they are, that they know and understand what they are signing and if one of the parties is represented (as opposed to present) that the representative is authorized to sign on behalf of that party. In the case of sale of property, the Notary should also verify that the seller is the registered owner of such property. That is the end of their job.
The reason they know how to check the values acceptable to Hacienda is that quite often their clients make the direct question and also if the price reflected in the Escritura is way unrealistic he might volunteer the advice to raise it if he believes it is a question of underdeclaring the purchase price, but he is under no obligation to do so.
The tax base of the Transfer Tax is the "real value" of the property and not the price paid by the buyer, so any belief that it is illegal for the Hacienda to re-assess the tax to the real value when the price does not reflect real value is incorrect. This has a basis in law and is, by no means illegal. Where there is ground for argument and disagreement is in the determination of what the "real value" of an asset is at the time it is being transferred.
Over the years (more than 50) of the life of the Transfer Tax the value of real estate has always increased compared to the years before. In fact for many years up to 2007 the value assigned to real estate by Hacienda was clearly below the prices being paid by buyers. Although Hacienda has reduced their valuation since the dramatic reduction in "real values" since 2007, it is clear that they are behind. This is what is giving rise to the complementary tax assessments and this is the reason many appeals have been successful. Where the solicitors have argued that the real value was lower than the Hacienda valutaion AND has been able to convince the courts that such argument is true for the property under consideration, the Courts have accepted to reduce or eliminate entirely the complementary assessment.
On the other hand, if the argument that has been used is that the price paid is lower than the Hacienda valuation OR the solicitor has failed to convince the Courts that the real value is lower than the Hacienda values, then the Courts will upheld the assessment. The price paid or declared is, therefore, irrelevant. The Courts have, on occasion asked Hacienda to reconsider their values and make a more in depth analysis of such values that merely looking at their lists. For example the value of two identical or very similar properties may be different if one is in a very busy central location and the other is on a nice beachfront or at the top of the a hill. Hacienda very frequently will simply use a value per square meter for a given locality and ignore the rest of circumstances that may reduce (or increase) such value.
I hope all of this helps to clarify some of the issues.
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Would any other country in the world operate like that? It's like saying I go to a supermarket and buy a packet of cornflakes on special offer but when I get to the till I have to pay the full price because that's the real value, not the price on the shelf.
And if it's not the notaries job to ensure a correct valuation is on the deeds, why did the original post (look back and see) state that the solicitor had claimed the Supreme court of Valencia ruled that the correct valuation should be the job of the notary?
Now, there's a lot about Spain that I love. I find it cheap, the way of life brilliant, the quality of goods excellent and have a nice, well built house which has none of the problems people complain about. I even find the bureaucracy improving and becoming easier to get things done. However, things like this (and the way solicitors operate in general) quite frankly stinks. Hundreds of properties in danger of being pulled down, thousands losing their deposits and, in some cases, entire life savings with no house at the end of it. Thousands of properties with no habitation certificates because the town halls are too busy infighting to get around to doing anything about it. And now some retrospective tax based on some airy fairy figure which bears no relationship to actual costs.
Estate agents should be made to put the "assessed" value on properties when selling. Something like "reduced from 300,000 to 150,000. The 8% tax on this property will be levied on the 400,000 that some office worker behind a desk states that it is worth, not what you actually pay". I got nearly 3k discount on a new car because I paid cash, should I now be liable to tax on that 3 grand because that's the list price?
No wonder some people have got so fed up with it that they have upped sticks and gone. I know that, if anyone asks me about buying in Spain in future, I would advise them to think again despite the good things.
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