Stamp Duty

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TrentEnd
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Stamp Duty

Post by TrentEnd » November 19th, 2015, 10:08 pm

We bought our apartment in 2013 and paid the required 8% 'stamp duty' on the purchase price. We have now been told that the apartment has been revalued and we are expected to pay about €3000 euros more . Has anyone else had experience of this and perhaps contested the amount to be paid?

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ladyrose
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Re: Stamp Duty

Post by ladyrose » November 20th, 2015, 11:37 am

:???: :???: :???: who told you this?

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Slartibartfast
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Re: Stamp Duty

Post by Slartibartfast » November 20th, 2015, 12:10 pm

I do not know the arrangements you entered into when you bought the property. But I do know there are various ways people use to try to lower the "buying cost/value" of the property in order to save on tax. E.G. part payment in cash or under paying for the property but over paying for the furniture.

Each local authority hold an up to date valuation on all property in their area these are used for taxation. If the valuation given, and tax paid when you bought does not match these......
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Re: Stamp Duty

Post by ciaran » November 21st, 2015, 9:54 am

viewtopic.php?f=52&t=25834

I don't think there is to much you can do about it, we purchased in Sept 2011, tax office revalued in May 2012, difference was 14,818 euros more , 7% tax on the difference was 1037, euros.

I'm not quite sure how the system works, if we purchased an apartment a a really bargain good price, could the tax office come after us in a few years , from what I understand yes they can, or maybe the real bargains are made on the exchange rate difference, I purchased at 1.14 today 1.42, I've lost out, but reverse the scenario happy days, :smile:
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Slartibartfast
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Re: Stamp Duty

Post by Slartibartfast » November 21st, 2015, 11:50 am

I've wondered that too Ciaran. If you're desperate to sell and accept a low offer will the buyers be hit later with the "Official" valuation.
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Re: Stamp Duty

Post by TrentEnd » November 21st, 2015, 12:11 pm

Thanks for your replies:
It's our lawyer who has informed us, we are going to discuss it further when we go over in 3 weeks time. He is talking about us contesting it & possibly obtaining a surveyor's valuation but of course that will cost money which might be wasted.
We have now heard that our neighbour who bought a bank repo at a good price, is having the same problem; his valuation is 60% more than he paid for the property & he has to pay 8% on that difference!!
We are not very optimistic but are thinking that the best outcome would be to negotiate a lesser sum otherwise we shall bite the bullet & pay up.
None of the apartments on the market are selling at the official valuation price. In England valuations reflect the current market value.
We'll let you know how we get on but it looks like being an expensive Christmas. CAVEAT EMPTOR!

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Re: Stamp Duty

Post by Slartibartfast » November 21st, 2015, 12:40 pm

I have posted about this before. The Spain is broke and they are trying to squeeze every cent they can out of everyone, whether it's fair or not.

This year before they would refund overpaid tax I was asked to prove that I had actually lived on Menorca!! The fact that I paid NI monthly and tax quarterly and that I was registered on the town hall census and that I paid local rates ....... was seemingly not proof...
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Re: Stamp Duty

Post by playapus » November 22nd, 2015, 12:42 am

Hi all,

I've not posted on here for quite a while, but this particular subject has also effected me recently.

I too have just received a demand for so called, 'complementary tax' last week. It would appear that they are having a purge at the Hacienda. :sad:

I'm awaiting the second letter which will give the final amount due, after interest has been added by the tax office since purchase. In my case, this will be about two years worth of interest.

The local Notary does not believe that an appeal would be successful. He too, is of the opinion that the tax office valuations have become outdated and do not take into account the collapse of the property market. Regardless of whether I prove what I paid for the property or not, if the tax office estimate my property to be worth more than I paid, then they want the tax on the difference.

I don't know if I can link this properly or not, but a good article on this unfair practice can be found here...

http://www.abacoadvisers.com/spain_expl ... entary-tax#

Being resident in England and away from Menorca for most of the year, (due to the lack of direct winter flights flights from Manchester etc.) is no excuse for not paying on time, or delaying any appeal either! It would appear that the Spanish law regarding purchase tax is one thing, the tax office's own rules however, are another.

As an aside; if we pay the extra 7% complementary tax due on their inflated property value now, are we liable to pay less capital gains tax 18% (?) later, when we sell?

P.

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Re: Stamp Duty

Post by TrentEnd » November 22nd, 2015, 9:54 am

Thanks.We were able to read the article which explains the situation very clearly. I imagine we shall be hearing a lot more about this.
Our neighbour (who is Menorquin) has made his first appeal & had it rejected. He is talking about being able to get a 10% discount; not sure what that is about, maybe prompt payment.

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playapus
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Re: Stamp Duty

Post by playapus » November 22nd, 2015, 11:18 am

I suppose we should take some comfort from the fact, that we have bought our properties at a bargain prices. This doesn't help to pay the unwelcome tax bill though does it? :roll:

I'd lke to think that a discount was available for prompt payment, as it is with parking fines, but somehow, I doubt that the tax office likes giving money back. It would be most welcome though!

In the mean time, it's as good a time as any to transfer Sterling abroad, with good exchange rates on offer?

I'd also be inclined to keep tight hold of the tax receipt after payment, in case this tax practice is later found to be illegal by the European courts. :denise:

P.

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