[Suvi]

I purchased a property 2007 for 100,000 euros as, as a result of the crash, it is now worth probably around 40 – 50% less. How do I stand with taxes etc if I sell considering I am making no profit?

[Pazza]

Assuming you are not resident in Spain and buying another property, they will withhold 5% of the selling price to cover possible capital gains taxes owed. The good news is that you should be able to get this back (my lawyer did this for me charging 10% of the amount recovered). The bad news is it took around 18 months and I have heard of others who never received anything.

Depending on when you converted your GBP to EUR in 2007, the exchange rate was far better then (circa 1.40) so bringing it back now at 1.13 gives you an approx improvement of 19%, which hopefully offsets some of your loss.

[fpegman]

Retention is 3% not 5%

[Author]

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