Reply To: CAPITAL GAINS TAX & PRICE QUOTED IN ESCRITURA

#218990

macgd016
Participant

Unless you have undertaken some significant renovation I think it is unlikely that you can mitigate your CGT liability. From what you have told us the escritura from 2005 gives the sale price as registered with the tax office and that is what will be used to calculate the CGT.

As you know, if you are a none Spanish resident, the buyer will retain 3% of the sale value and pass this on to the tax man, however, I don’t know what happens after that.

I believe that CGT in the UK is declared as a self assessment, if this is the case in Spain as well what would happen if you simply stop submitting tax returns?

However, if CGT is calculated by the tax authorities would they chase you in the UK for it? Perhaps others have some experience of this and could advise better.

You do however highlight the dangers of giving a power of attorney to a third party as you give them the authority to act on your behalf and if they make mistakes or do not act in your best interests you still pay the price for their actions. All too often we see Spanish lawyers recommending that you give them power of attorney so that they can sign documents on your behalf which might seem very convenient but your experience shows how this can lead problems later on.