I am in the process of buying a property in Barcelona, it with current exchange slide is topping my available funding. So question of cash flow here. What I want to know is is it correct as I’ve been advised that as long as I pay the full purchase price on completion date, which is mid March , I can pay for the actual finalisation of registration anytime upto 12months from that date without any penalty?? Has anyone had experience in doing this. Are there any risks involved… I’m probably only talking about a 3 month delay on registration fee here, as its clearly in my interest to get to finalised asap for legal clarity.
What do you mean by “pay for the actual finalisation of registration anytime upto 12 months from that date without any penalty”? Can you clarify, please? Are you referring to taxes?
Marcus, correct, ITP in Catalonia is currently 10% flat rate.
This is what legal contributor Raymundo Larraín has to say on the subject:
As from the time you complete, you have 30 working days to file and pay either ITP or IVA. Once paid can you then lodge your property at the Land Registry.
Moreover, there is a legal risk. When you complete at a Notary, the Notary Public sends to the Land Registry a copy of the deed so that the place is ‘reserved’ for the buyer. This reservation is only for two months.
So imagine the seller double or triple sells the property (something which happens frequently) during those 12 months; the first person to actually file the taxes and register their deed at the Notary would win. So someone who completes (for the second time on the same property) on the property six months after the first person would have a stronger claim than the first person because they actually lodged their right first (prior in tempore, potior in iure).
So the tax has to be paid within 30 working days as from completion at the Notary Public so no penalties are accrued. You can of course file the tax in time and register the Title deed at a later date.. .but this makes little sense as you have already paid the tax so I do not see any advantage and there are many legal risks associated such as someone else registering a Title deed on the same property ahead of the other buyer (double sale).
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