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I don’t know if you are aware, but there is a war brewing – possibly already underway – in Lanzarote.
One one side are a local company (British) who write wills and make “shelters” for property.
On the other side are a local (Spanish) firm of lawyers.
Background:
The company who write wills have been advertising for a number of years over here. Their case for having a will is a strong and sensible one in so much as everyone should have one.
This then goes on to inheritance tax situations and it gets very confusing.
Marry this with some “worst case scenario” full page advertising in local publications and the cat is amongst the pigeons.
So, the war begins as a rumble with lots of people asking if the advice given is sound advice.
Articles begin appearing in local magazines both for and against the arguments – should you have a will made in the UK/made in Spain in Spanish/made in Spanglish etc etc.
Now, anyone who has ever had anything to do with any kind of tax in Spain knows that it is complicated.
In fact, in a handbook I used to refer to the very first sentence was “tax in Spain is a complicated issue…”
The firm of local lawyers then enters the fray, publicly, by stating that the advice being given is incorrect. Once again, by taking out full page adverts in prominent local publications.
The will company reply with a DOUBLE page spread, printing the lawyers last full page and writing “wrong” and “totally wrong” etc over each point the lawyers have made!
I must tell you that the publications are read by every Brit on the island, not to mention non-Brits and I understand the publication runs to be in excess of 10,000 each time. The publications are monthly.
So, war seems to be officially declared by each side saying the other does not have a clue what they are talking about.
Enter new combatant (or are they?)…
Along comes a company who claim that you can buy and sell property without paying any taxes. Just the price of the property. Nothing more.
Is this company linked to the will company?…
If you feel that you would like to read a little more then I will give you the links.
I must say that I, like nearly everyone else, is completely and utterly confused by all of this. Indeed, in the last publication, a member of Blevins Franks writes an article along the same lines but the article is peppered with the words “usually” and “normally” when talking of tax cases. It even states a court case overturning what everyone thought was correct!!
Publications that are covering the war:
http://www.gazettelive.com
http://www.holabuzz.com
and the new combatant to enter the fray, http://www.bi-cell.comThe local population have been watching things progress on a monthly basis, but if you want to don your Deerstalker and do a bit of reading up then you may find that the latest online http://www.holabuzz.com to be a good place to start.
In any case, I think all forum members would be interested to have a look at the website of http://www.bi-cell.com and post your thoughts.
This has been Stewlanz reporting from Lanzarote.
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Unfortunately, the online http://www.holabuzz.com is now showing the May 07 edition and it was the April edition I wanted you to see!
I will find a way of putting up a link so you can see it….Anyway, very interested to hear about the http://www.bi-cell.com stuff.
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Interesting stuff.
By the way, if you already have a will in the UK, you don’t need to draw up a new will in Spain when you buy a holiday home here, though it is a good idea to have your British will translated into Spanish and registered in Spain. The Spanish authorities will accept a British will as valid.
Mark
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Hi Mark,
Next week I will scan in all the warmongering adverts from the relevant publications and try and post them in the order they have appeared.
Remarks like yours above, have, believe it or not, turned into a full scale slanging match between lawyers and others and I am sure that it will be interesting reading for all forum members.Cheers,
Stewart
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Not sure if this is relevent regarding making a will in Spain or the Spanish accepting a translated U.K version.
Chose to play safe as I dont like how some of these Spanish property deeds seems to get rather translated to suit the developer or the Spanish system.“They will accept a UK Will if it’s been legally translated into Spanish, and then registered at the foreign office. This can only be done at the time of death and it costs more than having a Spanish Will.”
Regards
Jim 😀
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The Bi-Cell idea seems to be based around making vendors “agents”, thus avoiding the traditional Spanish witholding tax. There are currently only six properties on there, three of which are at Sands Beach Villas in Costa Teguise. Anyone who knows the history of Sands’ predecessor, the Lanzarote Beach Club, and the ongoing Madrid court case where former timeshare owners are alleging that they’ve been cheated out of £150 million may start to hear alarm bells.
The Wills company maintain that most death duties, wealth and capital gains taxes on property can be avoided by putting assets into a “Patrimonio Familiar” shelter. Do any of the forum’s lawyers have knowledge of these? The company charge 5,000 euros, plus 1% of the property value to do this, and then 500 euros a year to maintain the shelter.
So, it’s not cheap! But would it work? And if so, why aren’t other concerns offering this ?The Wills people aren’t lawyers.
Anybody?
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The Bi-Cell idea seems to be based around making vendors “agents”, thus avoiding the traditional Spanish witholding tax. There are currently only six properties on there, three of which are at Sands Beach Villas in Costa Teguise. Anyone who knows the history of Sands’ predecessor, the Lanzarote Beach Club, and the ongoing Madrid court case where former timeshare owners are alleging that they’ve been cheated out of £150 million may start to hear alarm bells.
The Wills company maintain that most death duties, wealth and capital gains taxes on property can be avoided by putting assets into a “Patrimonio Familiar” shelter. Do any of the forum’s lawyers have knowledge of these? The company charge 5,000 euros, plus 1% of the property value to do this, and then 500 euros a year to maintain the shelter.
So, it’s not cheap! But would it work? And if so, why aren’t other concerns offering this ?The Wills people aren’t lawyers.
Anybody?
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Hi Dr Robert,
I am still trying to get my hands on the back issues of the 2 mags who have been covering the war so that I can post on here.
As for you asking Lawyers….this is where this war has come from.
The will co. saying lawyers ain’t got a clue and the lawyers saying the will co. ain’t got a clue.
I’ll definitely try to do it next week.
As I posted earlier, both sides have posted High Court rulings showing one side or the other to be correct.
Then another ruling which threw it all out of bed again (which was subsequently overturned!!!!!)
Then Blevins Franks entered the fray – unbeknownst to them, I think – but the article left more people more in doubt than ever before!!As for Bi-Cell and Sands Beach Villas.
I think that in this case it is simply a coincidence and that the properties for sale on the Bi-Cell site are simply those owners who have set up one of the shelters.
Interestingly enough, the bi-cell leaflets were given to every bar the other week to put out on display….. -
Hi Dr Robert,
I am still trying to get my hands on the back issues of the 2 mags who have been covering the war so that I can post on here.
As for you asking Lawyers….this is where this war has come from.
The will co. saying lawyers ain’t got a clue and the lawyers saying the will co. ain’t got a clue.
I’ll definitely try to do it next week.
As I posted earlier, both sides have posted High Court rulings showing one side or the other to be correct.
Then another ruling which threw it all out of bed again (which was subsequently overturned!!!!!)
Then Blevins Franks entered the fray – unbeknownst to them, I think – but the article left more people more in doubt than ever before!!As for Bi-Cell and Sands Beach Villas.
I think that in this case it is simply a coincidence and that the properties for sale on the Bi-Cell site are simply those owners who have set up one of the shelters.
Interestingly enough, the bi-cell leaflets were given to every bar the other week to put out on display….. -
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Hi Dr Robert,
Would agree with the paid advert stuff.
Don’t think any journalist would be able to get to the bottom of it anyway!
But, watch this space as I have suggested a route to one of the publications in question….As for connections, I wouldn’t like to say here as not sure of my facts, but it don’t take no investigative hack to put 2 and 2 together…..!
Regards,
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Does anyone have an update regarding this matter.
I have heard of the Quill Patrimonio Familiar Shelter but I’m very skeptical since the promoters make it sound too good to be true. Supposedly it will save alot of money in taxes. Do any of you have any experience with such Partimonio Famiiar Shelter and do they work as promised?
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Hi All,
Unfortunately, I have still not had chance to get all the back copies together…but no matter.
It seems that things are progressing on here anyway with people asking about the Patrimonios.
It is IMPOSSIBLE to get a definitive answer in Lanzarote as 2 sides are stating that they are correct whilst saying the other is incorrect.
Court cases have been quoted and then others quoted that overturned the decisions etc.
The “worst case scenario” marketing continues over here just as strongly as ever.
As mentioned before, even Blevins Franks had an article in one of the mags (though I don’t think they knew their article would be in the middle of the warring factions), but their input just muddied tthe waters even more!
The Bi-Cell website goes into some blurb if you can find it (not the friendliest of sites) but I simply cannot get a definitive answer over here as to what they profess to be able to do.
More worryingly, the scare tactics advertising opens up even more questions along the lines of Inheritance Tax etc with the adverts saying that you may have a bill so big that you have to sell the property left to you in order to pay it….but you are not allowed to do this!!!!
Don’t get me wrong here, I am not knocking the Will company nor the lawyers who are on the other side as I don’t know who is right and who is wrong and I myself have written a will with the will company in question.
It’s just that it’s a dead end for answers here and some outside input is needed.
For background see
http://www.bi-cell.com
http://www.quillgroup.net -
I was interested to discover this thread (although not current) as I have just come across the “wills company” myself when looking at a property in Lanzarote. It DOES all seem “too good to be true” and I am not surprised there has been controversy over their strategy. All of which leaves the likes of you and me (unless you are lawyer AND a tax expert!) somewhere dangling in the air 😯
It might have some bearing on the matter to know that a certain Quill Wills in the UK was shut down by the DTI “in the public interest” because the DTI said its sales brochures used to promote the franchise opportunities were “false, misleading and deceptive”. See link.
http://theorangerag.blogharbor.com/blog/_archives/2007/6/22
The article also suggests that the directors of THAT Quill Wills (names supplied) might be the same as those of the Lanzarote-based firm which has apparently now embroiled in the current controversy!
Even worse, the article suggests that the legal bodies to which the
the new Quill Group claims to be accredited (see their website)
http://www.quillgroup.net/accredited by the Willwriters’ Association – governing the ethics and standards of home visit Willwriters.
The Group is a member of The Association of Lawyers who are the Association for accreditation of single discipline legal professionals.
(ie The Willwriters Association and The Association of Lawyers) are
nothing more than companies started by the directors of the Quill Group! Hmmm 🙄NB I have checked the latter facts with Companies House records and this appears to be true.
In view of these twists, I am left wondering whether they would change Lazarote/Spain buyers instinct on which side of this Bi-Cell argument they would prefer to place their money?
For my part, I would be delighted to think that Quill’s expertise has found a legal loophole in the Spanish and UK tax law, and that their high costs to set the deal up are therefore justified – but the cynic in me… Hmmm 😯
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Update for you…
I had a meeting with the people who are now signing up vendors to the Bi-Cell stuff.
After an hour of (very well presented) information, I have decided not to take matters any further on a personal or professional level.
The main idea seems very simple – although I was assured that the workings in the background were very complex.
The basic structure seems to be that property is placed in a Spanish holding company (non-trading) which in turn is owned by a UK company. I was then told that because of various tax concessions etc that when a sale happens, because a company is changing hands and not a property, then there is not ITP to pay.
I only heard the blurb once, and it was a month or so ago, so I cannot remember the full details.
However, my Gestor and others I have spoken to still say to steer clear. Various trusted lawyers advise to steer clear also.
Interestingly enough, the people now promoting it have actually sold their own house using the Bi-Cell structure and so they have full confidence in it.
The subject is not “dead”….just dormant whilst further investigations continue. -
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Hi there – sounds similar to a system until recently used here. Property is bought under an SL as a non-trading company. The SL is then owned by either a uk or a gib compnay and when you buy the proeprty you actually buy the company which has the asset of the property, therefore not actually buying the property but the company, so no transfer tax etc etc etc!
However, now one cannot buy a property in spain with a spanish mortgage and have it in the name of an SL – the property comes out of the sl and taxes etc are charged. So unless the buyer has cash or raises finance elsewhere, he acnnot buy the company owning the property!
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Hi DrRob, Yes the prop is a lot more than 200k so in principle it is is very worthwhile – if you have the guarantee you speak of 😕
Inez, You got it, thats the deal, the SL is owned by a UK LLP (new-style Limited Liability Partnership – rather than a UK Ltd Co) in which BUYER is a limited partner.
But if, as you say, the property cannot be bought with a Spanish mortgage or else tax becomes payable (I have no knowledge of this and am relying on your statement) why are Quill Wills doing doing it this way? 😯
And if its that clear-cut why the detailed (and seemingly ongoing) argument between Quill Wills and the Lanz firm of lawyers?
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Now another company (or is it the same one???) has appeared….
Advertising the same kind of thing but in Fuerteventura, they are calling themselves Fit4sale.net
No names in the blurb, only a mobile contact number and even a hotmail e-mail address (puh – leeeze!!)
Have a look http://www.fit4sale.net
Interestingly enough, their (full page) advert is on the opposite page to the Bi-Cell one!
The plot thickens… -
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Hi Arby – ahhhh so there are new types of limited companies now in the uk…..
In mainland Spain if as a buyer you get a spanish mortgage via a spanish bank, they will not lend to shares f a company any more – they used to and then the sellers would ‘transfer’ the company for a niminal sum thereby avoiding capital gains tax!
So – loophole closed and a buyer with mortgage has to buy the property in his name and the seller has to sort out his tax affairs (complicated how they do it – but I have one going throguh now) and pay capital gains!
So no idea if the tax laws are different in Lanzarote as it is an independant linked to mainland!
Confused??? You will be!
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Well, it’s been a year since the last post on this subject, so about time for it to be bumped up.
If you have an hour or two, then you might want to put the coffee on and catch up with things.
Matters seem to have come to a head and the fight for those who bought shelters continues.
This really is required reading for anyone with property in Spain as it may raise its head in other forms in the future…http://www.gazettelive.com/forum/index.php?topic=833.0
Stewart
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