property tax

This topic contains 10 replies, has 5 voices, and was last updated by  katy 9 years, 7 months ago.

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  • #55241


    Sold a property last year 3% tax that was held back, how long do i wait for my money back.

  • #94569


    6 months.

    …. But have you submitted the appropriate documentation to Hacienda.

    I sold my investment (Ha Ha…) property earlier this year. The transaction was completed in early March and we submitted the documentation to claim the refund at the end of April.

    Your buyer should have completed form 211 which details the retention. He is required to submit this to Hacienda, I believe within 30 days of the sale completion.

    You may only submit form 212 after your buyer has submitted 211 and I believe you have to do this within 3 months, of I presume, when he submitts form 211. Did you follow the above procedure!

    Hacienda then have 6 months from when you submitted form 212 to make the refund.

    I went in the main Hacidenda office in Almeria in September to see what progress had been made on my refund. I was told it could take years to receive the refund. But Hacienda must pay interest after 6 months if the refund has not been made.

    FYI, they had none of the documentation (except form 211, 212) relating to our sale. So for example, the two escrituras (ours for buying originally, and the sale escritura). So 6 months after our sale they had done sweet FA.

    Personally I have written off the 4k Euros that they have retained. However, I will pursue the refund and having a Spanish wife and “contacts” that work in Hacienda I am still hopeful I will see it one day.

    Spain has a big problem with it’s fiscal situation at the moment and I can easily image that repaying retention tax is the least of their worries.

    When I sell my Spanish holiday apartment, (which will cut all my ties with Spain, unless I do something stupid like move to Spain with my wife or buy anonther apartment) I am going to declare I am resident, simply to avoid these problems. If I get my refund back maybe I will be honest, but as I said I really don’t believe I am going to get it any time soon.

    I guess that’s why the Spanish have their attitude to tax evasion. Rates are high and getting money back is a long real struggle. Much simpler to not pay any in the first place


  • #94570



    Also noticed that you have posted about a 10K deposit without signing a contract…

    Just to be crystal clear, you understand that that the 3% retention is for payment of capital gains tax!!!

    I assume if you are buying now and have also just sold you had your previous property for some time and sold it for more than you bought it for?

    I can’t imagine you are trying to get your fingers burn’t twice in the Spanish property market. In which case you will need to pay capital gains tax and may need to pay more than the 3% retained.

  • #94571


    jp1, as you are married to a Spaniard. I dont need to tell you the thinking, attitudes & why they do certain things & not the other.

    “I guess that’s why the Spanish have their attitude to tax evasion. Rates are high and getting money back is a long real struggle. Much simpler to not pay any in the first place”

    Its not only getting the money back, the system will be full of paper chase, people will be spending their time, effort & energy in trying to grease the paper chase in between siestas, fiestas & the whim of the funcionarios. These funcinarios will not do what they are meant to do within the time frame or in the manner that should be done.

    Further, Spaniards do not see an appropriate use of their taxes & if they ever need the assistance of the state it will not be there.

    Sadly, this psyche and in addition the Franco period has made the Spaniards treat anything & everything with disdain apart from enjoying themselves.

  • #94609


    jp1 we did not make a propfit from the sale. i should be so lucky.

  • #94612


    The junta may think you have made a profit

  • #94622


    That is why when I sell my holiday apartment (one day) which has gained significantly in price even in todays market, I will simply declare myself resident and prevent any monies being deducted. They can then come and chase me for CGT.

    However for sellers, that have bought at the top, and sold quickly I can’t see how hacienda can really push any line about profit, since there is 7% IVA on a new apartment. The offical figures show about a 10% decline in prices (we all know it’s more like 30%). So that is a 17% difference they can’t imagine away. And to withold CGT you need to have made a profit.

    3% retention on the entire sale (for the correct amount of CGT to pay)equates to around a gain of 22%, Any less you need a refund any higher gain you need to pay more CGT.

    So that means Hacienda has to say that the real value of the house is around 39% higher than the offical figure to keep the 3% retention. And we know the offical figures are already over inflated

    They would have to be really stupid to believe that they could get away with figues like that in a global recession.

  • #94623


    It is not possible just to declare yourself resident. You have to produce spanish tax returns for a few years. No they shouldn’t get away with their over-inflated figures, but…..they are the junta, and they do!

  • #94624


    I was just about to ask the same question about declaring yourself resident. If it was that simple everyone would be at it.

  • #94628


    @katy wrote:

    It is not possible just to declare yourself resident. You have to produce spanish tax returns for a few years. No they shouldn’t get away with their over-inflated figures, but…..they are the junta, and they do!

    If you are in Spain more than 183 days in a year you are considered resident for the purposes of tax. You do not have to have been submitting tax returns for years. I would imagine that from the point I decide to sell to completion it would exceed 6 months. How is anyone going to track whether I have been in the country during that 6 months.

    I appreciate that it is more complicated than ticking a box on a form, but the moment you decide to reside in a country you are a resident. It’s a simple as that. I will be flipping my country of residence just like our UK MP’s do with their second residences.

    I am pretty sure that It will be relatively simple, once I have decided to sell, to simply declare that my Spanish home is my main residnce and simply complete the papework for Spanish residency. Whether I am in the country or not the tax office is not going to track me. I just have to complete the tax procedures of a resident and of course I will be unemployed with no assets or savings.

    I assume there could be some risks, but given the huge tax evasion by Spanish residents on Spanish assets in Spain, I can’t see that during a short period of time whilst my property is on the market they would track down assets in the UK that I have not declared on my Spanish tax return.

    I know someone running a restaurant only declaring a third of the real salary of the staff. So two thirds of the pay in cash!! The Spanish tax system is a joke. Even the HMCR calculate a value of reasonable tips for catering staff. Surely even an idiot would realise that the third declared is not the normal salary of a cook, waiter etc.

    I don’t agree with tax evasion and always pay all my taxes. But when Hacienda takes the piss and tax me at almost 10% for buying a property and then tax me again on a huge loss, something that is not done for residents (ie the retention), then I am going to do by best to not let it happen a second time. Anyway if they return my 4k I’ll play by the rules, but as I said earlier I don’t believe I will receive it.

  • #94630


    Believe me it cannot be done. The onus is on the seller to provide evidence of residence, the main proof is tax returns. That is why anyone living in Spain should file every year even if it is a nil payment. I also think the minimum residency requirement is 3 years. The notary asks to see all evidence…no 3% retention, no sale!

    If it is so easy why wouldn’t everyone do it?

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