Schlagwort: english speaking solicitor

RTA VERHUURREGISTER ANDALUSIE: BOETES, BELASTINGEN, LICENTIE VAN EERSTE BEWONING EN LANDELIJKE WONINGEN

RTA FOR HOLIDAY RENTALS IN MALAGA: FINES, TAXES, FIRST OCCUPATION LICENCE AND RURAL PROPERTIES

Geschrieben von admin am 21 Mai, 2018. Veröffentlicht in Andalusian, costa del sol, english speaking solicitor.

RTA, andalusian, taxes, occupation licence — RTA registration property rentals

It’s been two years since the entry into force of Decree 28/2016 regulating RTA FOR HOLIDAY RENTALS for properties in Andalusia.Half of all holiday rental properties in Andalusia registered before the Tourism Registry of Andalusia are located in the province of Malaga, according to the information published by Diario Sur in February 2018. This means that, in Malaga, there are over 18,000 tourist apartments registered.

It is important to remember that property rentals are subject to taxation

RTA FOR HOLIDAY RENTALS: inspections and penalties

The same newspaper has published that, in Malaga alone, there have been 1,354 inspections and 250 properties have been fined.

One of the most important requirements to be met by these properties is that they must have an initial-occupation licence as well as cooling and heating equipment. Once an RTA / VTAR number has been obtained, the property owner is required to include the registration number in advertising as well as in the promotional page on AirBNB or similar platforms offering these properties as holiday rentals.

Initial-occupation licence requirement

If the property does not have an initial-occupation licence, it should not be registered before them. I use the word “should” because the registration form is an affidavit, for which reason the property owners submitting it declare, under their responsibility, that the property meets all the legal requirements and the Andalusia Council will register the property automatically, without performing any prior inspections. However, if an inspection later finds that the legal requirements are not met, the owners will be fined.

There are many properties without an initial-occupation licence, due to different reasons, such as the age of such buildings, problems with the housing development, etc. This has driven some municipal councils to implement a specific procedure to obtain an initial-occupation licence solely to register the property before the Tourism Registry of Andalusia. Some of these councils are Málaga, Mijas and Benalmádena.

Nerja Council

The situation of holiday rentals in Nerja deserves a special mention. Nerja Council has paralysed the granting of initial-occupation licences since the entry into force of the Tourism Decree.

A month and a half ago, the council also established a procedure to grant such initial-occupation licences only for the purposes of registering properties before the Registry of the Andalusia Council (RTA). The website of the municipal council now includes the form necessary to file this application.

Over one year ago, our firm requested a copy of the initial-occupation licences of different properties in Nerja and, two weeks ago, we started receiving responses from Nerja Council.

Fortunately, the situation of these holiday rentals in Nerja seems to be in the process of being brought in line. This is definitely good news for all interested property owners as well as potential property buyers who will have the ability to obtain the initial-occupation licence necessary for registration.

Properties located in towns with fewer than 20,000 inhabitants

Another significant change that took place recently in the regulations set down by the Andalusia Council is that affecting holiday rentals located in towns with fewer than 20,000 inhabitants. These are towns such as Torrox, Viñuela, Alcaucin, Frigiliana, Competa, as well as most towns in La Axarquía.

Properties in these municipalities are not eligible for the 2016 Decree due to the properties being located in towns with fewer than 20,000 inhabitants. However, since February of this year, it is possible for them to be eligible for the 2016 Decree as they will no longer be considered rural properties, which, until now, was the only way to register these properties as holiday rentals.

RTA list of holiday rentals registered in Malaga

Due to the boom in holiday rentals in certain cities, such as Malaga, the Council has published a list of the registered holiday rentals.

This tool seeks to inform tourists about accommodation possibilities in the city and is also a tool to control the tourism boom affecting the city.

It should be noted that Malaga city is currently experiencing a significant boom in tourism, especially around the historic city centre. This has led to the emergence of plenty of tourist accommodation options, which has resulted in price rises for long-term lettings due to the low property supply as owners opt to offer the properties to tourists instead.

Over the last year, the historic centre has lost residents to holidaymakers. The Malaga Council is already debating the measures that should be taken to limit or regulate holiday rentals and make residential and tourist use compatible, so that residents are not lost and it is possible for people in the community to access rental homes, taking into account the average income in Malaga.

You can see the case of Palma de Mallorca, a city that recently approved a norm prohibiting holiday rentals.

Tax payable on the profits obtained

It is important to remember that property rentals are subject to taxation, for which reason owners –whether resident or not (IRNR)– must declare the profits obtained from such rentals.

Non-resident owners must declare such profits through form 210, which is submitted quarterly. Fortunately, since January of this year, the procedure has been simplified to make it possible to declare, in form 210, all the earnings obtained from renting the existing or new build property as a holiday rental over the quarter, even if they come from different occupants.

If the non-resident property owner owns several properties, a separate form 210 must be submitted quarterly for each one, and 19% of the total earnings obtained will be paid as tax, with the ability to deduct certain expenses according to the period of rental during that quarter.

It is interesting to note that, if you are tax resident in Spain, holiday rentals are taxed at a higher rate than rentals of usual residences –residential rentals–. This is the case because the Tax Agency allows these residential rentals used as the tenant’s usual residence to apply a reduction of 60% over the positive net return obtained from the rental. However, this deduction is not allowed for holiday rentals offered by tax residents.

Currently, there are still many property owners who do not declare rent but, if the Tax Agency devoted some attention to this matter, it could start inspection proceedings ex officio, by simply visiting a few websites and comparing them to the list of properties registered in the Tourism Registry of Andalusia.

Author: Gustavo Calero Monereo, lawyer at C&D Solicitors Torrox (Málaga, Andalusia)

DAFO Certificaat aankoop huis platteland Andalusie

THE PURCHASE OF HOMES AND DAFO/SAFO CERTIFICATES IN ANDALUSIA

Geschrieben von admin am 8 Juni, 2017. Veröffentlicht in Andalusian, costa del sol, lawyer.

Lately, in the purchase of rural homes, one of the most important points discussed between buyers and sellers is the procedure “Asimilado Fuera de Ordenación”, –DAFO or SAFO–. What it is, what its consequences are, who does it, who assumes the cost, etc.

Basic rules to buy in the countryside in Andalusia

Before talking about this procedure, and based on my experience with clients looking for a home in the countryside, it is necessary to mention that, in non-development land in Andalusia –rural land–, it is not possible:

To build homes, unless the intention is to engage in agricultural or livestock-farming activities in a professional capacity on the parcel.
Existing buildings may not be expanded and/or remodelled, both inside and outside. People have to purchase what is already built and no changes are legally allowed.
It is permitted to build with the intention to operate rural accommodation or a bed & breakfast, but it is necessary to carry out a preliminary operational project – called in Proyecto de Actuación -, that the Government of Andalusia must approve. This procedure can take over 6 months and it is difficult to obtain a positive response from the Regional Government.

It is necessary to take into account that most homes currently sold in the Andalusian countryside are illegal or irregular, i.e. if the authorities had done their work, they should not have allowed construction and, therefore, they should not exist.

The case is that, for most buildings, it is not possible to start any penalty procedures against buildings built without a licence or with an illegal licence on non-development land due to the time elapsed.

This means that legal responsibility is time-barred since over six years have elapsed since the end of construction. When we refer to non-development land with any special protection, the period of six years does not apply.

What buildings can and cannot be constructed in the countryside

In non-development land, a construction licence cannot be granted to remodel or rebuild. For instance, in the event of a fire when the home would be completely destroyed, it´s not allowed be rebuilt.

It is possible to grant a licence for small repairs or modifications necessary for the habitability and safety of the home, such as, for instance, replacing part of the roof or a wall that has been damaged or has collapsed.

Why was DAFO/SAFO created?

Because of the above, the Government of Andalusia approved regulations in 2012 with the idea to regularise, not legalise, thousands of homes built on non-development land –rural land–, in breach of urban-planning regulations. Since 2012, City Councils have started to create internal regulations to govern this procedure.

Speaking colloquially, with the resolution of Assimilated out of Ordination – Asimilado Fuera de Ordenación -, the goal is to have a record with a specific date of what has been built on that property –both inside and outside each building–, how many years have elapsed since construction and to certify that the home can continue to exist without penalties in the future, even though it will not be possible to expand it and/or remodel it or to build new structures.

This is not a legalisation because the home is left outside urban regulations –as it was built illegally– but it is a regularisation as the City Council itself certifies this legal situation and confirms in writing that it will not be possible for this home to be subject to a penalty due to the time elapsed.

The legal situation of a home in non-development land does not change after receiving the resolution of DAFO/SAFO from City Hall, i.e. the home will continue to be illegal as it was built on land where construction is not allowed but, since the time limit established by law to issue a penalty for this infringement has elapsed, this procedure against the owner cannot be started due to this situation. With or without a DAFO certificate, the legal situation remains the same.

DAFO/SAFO Procedure

In this procedure, it is necessary to have a project by an architect, to pay a fee on the value of the building on the date it was built, which may range from 2.5% to 4.5% depending on the City Council where the property is located, and the City Council will also verify the water and electricity supply as well as the need for a septic tank so that the home can comply with regulations.

It will actually be the architect paid by the owner who will inform, in his or her project, everything necessary for the home to be eligible for a DAFO certificate. Once the project has been submitted, the architect from the City Council will visit the property to inspect it and verify whether it complies with the requirements for a DAFO certificate.

Once this procedure is completed, which may take between 4 and 6 months, the City Council will issue a resolution certifying Assimilated out of Ordination – Asimilado Fuera de Ordenación -, from Regulation for that home and all structures built on the plot.

Is DAFO mandatory for the sale of a home?

To buy or sell a property, holding a DAFO/SAFO certificate is not a legal requirement. That being said: is obtaining a DAFO/SAFO certificate for a property good or bad?

In favour of the DAFO certificate, we can mention that buyers will have the certainty that what has been built already cannot be subject to a penalty and/or demolished because it is accredited in writing that legal responsibility is time-barred, with the certificate from the City Council granting the DAFO certificate. Likewise, it will provide certainty that the City Council will not require you to obtain a DAFO/SAFO certificate for the home in the future, as the procedure was already completed at the time of purchase.

It should be taken into account that, currently, nearly no City Council offers any information in writing regarding a property built on non-development land unless it holds a DAFO certificate or processes it.

This means that, if you go to get something in writing, they tell you that you certainly can but you first need to process the DAFO certificate for your home. This means that, if you do not want to obtain a DAFO certificate for any reason, it will be very difficult for buyers or their lawyers to obtain information in writing about the property.

The downside of having the DAFO is that, if there are any structures or remodelling –inside or outside– completed within the last six years or if the land on which the property is located is subject to any type of protection (and it can´t be proven that the buildings are old enough), applying for this procedure can only cause problems to the owner as the City Council will be required to initiate penalty procedures.

Likewise, if the new owner is thinking about remodelling after buying the home –ignoring the advice of a good lawyer–, the City Council will already be perfectly aware of what had been built before and it will be easier for them to prove that the structure has been remodelled or some variation has taken place.

It is also necessary to take into account that it may be possible for a property to obtain a DAFO certificate in 2016 and remodelling or expansion of that home to take place in 2017. What I mean with this is that complete certainty in this sense can never be achieved.

Current status of the DAFO certificate

It is true that the processing of this certificate is starting to become common at City Councils because they have also realised that it´s tax payment is an important source of income.

Many City Councils have an unwritten rule to start an application automatically when they receive or someone requests any type of information and/or documentation about a property on rural land, so we can say the owner would be obliged to make the DAFO.

In the situation mentioned above, many buyers want to prevent having to pay for the cost of the procedure themselves, which has resulted in an increasing number of buyers requiring the seller to process it and pay for it.

It is also true that, in some sale transactions where a DAFO certificate is not desired, a reduction in the sale price is usually agreed with the seller and the new owner will decide whether to apply for it in the future.

Is possible to get a mortgage in a property with DAFO?

Another issue that some clients ask about, is whether it is possible to grant a mortgage for a property with a DAFO certificate.

On this matter, the reality of the property market goes beyond the legal limitations in force since 2009 as, even though it is not theoretically possible to grant a mortgage for buildings or structures exempt from regulations, the reality is that there are banking entities that do grant mortgages for properties out of ordination or assimilated out of ordination, i.e. rural properties.

In my opinion, if there is money to be made, banks will not stop granting mortgages for properties of this type -with or without DAFO- regardless of what the Decree of 2009 says. Obviously, mortgages approved for these properties usually offer a lower loan amount and not all banks offer mortgages on rural land.

Buying and selling homes in rural land

When buying and selling homes in non-development land, for them to be able to be included in the property market, with or without a DAFO certificate, there are no limitations or restrictions. This means that most of these properties are registered in the Property Registry and in the Cadastre and have already been sold or bought on different occasions even though few yet hold a DAFO certificate.

Currently, there continues to be an important portfolio of potential buyers interested in properties in the countryside.

The important thing, when someone is looking to buy a property on rural land, is for buyers to know what they are buying, be aware of the legal limitations of properties on rural land, and receive specific legal information about the property, with or without a DAFO certificate. This will enable them to make a decision with full awareness of the legal status of the property.

A lawyer to buy a property?

Lastly, it’s not that we’re trying to promote our services –well, maybe a little–, but in the purchase of a home, especially for homes like these, having a lawyer is never a bad idea as his or her fee will cost very little in comparison to the purchase price and can save you from many headaches or costly problems in the future.

Author: Gustavo Calero Monereo, lawyer at C&D Solicitors Torrox (Málaga, Andalusia)

BODEMCLAUSES HYPOTHEKEN: NEGATIEF RAPPORT VAN CJEU

FLOOR CLAUSES MORTGAGES: NEGATIVE REPORT FROM CJEU

Geschrieben von admin am 1 August, 2016. Veröffentlicht in Andalusian.

In our last article in May, related to floor clauses, we explained that judicial proceedings before the CJEU (Court of Justice of the European Union) are currently taking place.

The purpose of these proceedings is to decide whether Spanish banking entities have to return all the money unduly charged through floor clauses or, on the contrary, they only have to return the amounts unduly charged after 9 May 2013.

The preliminary opinion of the advocate general taking part in these proceedings establishes that banks should only have to return the amounts unduly charged after 9 May 2013.

The Judgement in these proceedings is expected for late this year and, even though the opinion of the advocate general is not binding, it is usual for the Court’s Judgement to follow the same reasoning.

Regardless of the surprise that this opinion has caused among many lawyers and judges, we must remember that Spanish banks will have to return the amounts unduly charged after 9 May 2013 through floor clauses, and this will not change, regardless of the Judgment of the CJEU, as these proceedings will only decide whether banks will have to return the amounts unduly charged before 9 May 2013 or only those amounts unduly charged after this date.

It is very important for everyone affected by floor clauses in a mortgage to file a judicial claim to recover the amount the bank has charged unduly, as well as to prevent the bank from continuing to charge them more money than the agreed interest rate for their remaining mortgage periods. The success rate in these proceedings is quite high and banks would be ordered to cover court costs caused by these proceedings.

Currently many banks are trying to prevent customers from initiating judicial proceedings by offering false solutions such as agreeing on a fixed interest rate for mortgages. Don’t sign or agree to anything without talking to a specialised lawyer as most of these solutions only seek to keep the bank from having to pay you everything it owes you and make you waive your right to file a judicial claim.

Thanks to our agreement with the Gallego & Rivas law firm, which specialises in banking law, we can study your case at no cost, completing an initial assessment of your documentation and giving you an estimate of the total amount of money you could claim, as well as the money you would save in the future by eliminating the floor clause from your mortgage. This is all with no commitment to hire our legal services.

If you are interested in getting this consultation free of charge, the way to proceed is to contact us at info@cdsolicitors.com, giving us your contact details and sending us a copy of your Mortgage Deed as well as the latest invoice for your mortgage loans. We will be happy to help you and clarify your legal status.

Author: Gustavo Calero Monereo, C&D Solicitors (Lawyers)

VONNIS: Bank verantwoordelijk bij ontbreken bankgarantie ontwikkelaar

JUDGEMENT: Bank responsible for bank guarantee developer

Geschrieben von admin am 16 Februar, 2016. Veröffentlicht in costa del sol, english speaking solicitor.

Bank responsible for guarantee developer

In September 2013 I published an article where I mentioned a judgment rendered by a Court in Albacete on the 8th of June 2012 and that was confirmed by the Provincial Court in the same year. In these proceedings forty-six homebuyers who purchased off-plan houses that were never built -but for which they had made several payments on account- sued the developer and the bank jointly, despite not having bank guarantees for the amounts paid.

As I mentioned in that article this judgment (a first at the time) ordered the bank to refund all the amounts paid by the buyers. It thereby established joint and several liability with the developer of the homes through an interpretation of articles 1 and 2 of Law 57/1968, of 27 July 1968 on the collection of advance payments in the construction and sale of homes.

This however was just an isolated judgment, which did not set precedent. In fact, in the two years since, there have been judgments both in favour and against banks.

These different interpretations have come to an end as, on 21 December 2015, due to the many contradictory judgments the Supreme Court rendered an appeal judgment on this matter. This judgment of the Spanish High Court unifies the criteria to prevent different interpretations by other courts. The Supreme Court is certain about the interpretation of these regulations and ruled in favour of individual homebuyers.

The High Court understands that the credit institutions where homebuyers deposit advance payments to purchase a home under construction, must respond to homebuyers. This refers to cases where the homes are not completed by the developer and the latter has no money or is insolvent, making it impossible for homebuyers to recover any money paid.

In the Fifth Legal Grounds, the last paragraph of the judgment, the Court states that the credit institution has the legal responsibility of a special duty of oversight over the developer to which it issues a loan for the construction of those homes, so that the deposits of homebuyers, especially individuals, are transferred to the special account that developers must open and the bank must require the developer to guarantee all the amounts it collects.

Credit institutions that grant loans to developers to build homes, have the legal obligation of opening a special and separate account, duly guaranteed, so that the amounts that buyers pay for the homes are deposited in that account. If the credit institution does not guarantee that buyers‘ money is deposited in a special account, it will be held liable for the total amounts deposited by buyers in any type of account held by the developer at the entity.

In other words, if the bank has not ensured the protection of the buyers‘ money, with this Judgment, there is no longer any legal doubt that the bank will be sentenced to refund, from its own “pocket”, the money paid by homebuyers in cases where the developer does not complete homes and it has no money or becomes insolvent.

In my humble opinion, it seems logical and consistent for the Supreme Court to have settled this matter in favour of homebuyers.

In banking practice, most developers building homes off-plan create a company aimed exclusively at building that development, with these companies usually being devoid of any assets.

From now own, I believe that these loans issued to developers will only be granted after reviewing the solvency and guarantees of the developers thoroughly and that branks will monitor the money that buyers pay for their homes.

In these situations, with this judgment by the Spanish High Court, buyers of homes that are not completed will have the necessary legal certainty to get, through a Judgment, banks to be ordered to refund their money, thereby having more options available to recover the money they lost.

It is very likely that, if this situation arises, now, with this judgment, the bank will choose to avoid legal proceedings and reach a settlement with buyers.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Nerja/Andalucia)

BONAFIDE EIGENAARS VAN WONINGEN, MEER BESCHERMING OP BESTUURSRECHTELIJK GEBIED

HOMEOWNERS ACTING IN GOOD FAITH, MORE PROTECTION IN THE ADMINISTRATIVE FIELD

Geschrieben von admin am 1 Juli, 2015. Veröffentlicht in costa del sol, english speaking solicitor, lawyer, malaga.

Compensation Andalucian home owners in good faith — Compensation demolition Andalucian home owners in good faith

Last 24 June, the Senate approved an amendment that provides greater protection to third-party homeowners acting in good faith in administrative proceedings. This amendment was approved with the favourable votes of the main political groups and introduces a third paragraph in article 108 of Law 29/1998, of 13 July, which regulates contentious-administrative proceedings in Spain.

This new third paragraph provides that: “The Judge or Court, in the cases where, in addition to declaring the construction of a property to violate regulations, it issues a reasoned order to demolish the works and restore the physical reality altered, shall require, as a condition prior to demolition and unless a situation of imminent danger prevents it, the provision of sufficient guarantees to respond to payment of compensation due to third parties acting in good faith.”

In other words, with this paragraph, it is guaranteed that the judge ordering the demolition of a building in administrative proceedings must ensure, prior to the demolition, that third parties acting in good faith that will be damaged by the demolition of their homes will receive compensation. This means that, what this new subsection regulates is that a home may not be demolished if the homeowner cannot be compensated in advance, as it is understood that the homeowner has no reason to suffer these damages when the party responsible for the unlawful act committed by building the home was someone else.

The approval of this new subsection equates the handling of the enforcement of judgments on buildings, which entail their demolition, in administrative and criminal proceedings since, as we explained in our article from March, the criminal code has also been amended in this sense.

The amendment in the administrative field, which gives greater protection to third parties acting in good faith, is even more logical, from a legal standpoint, than the one in the criminal field and, needless to say, represents the correction of a regulatory mistake that resulted in great injustice.

It should be noted that, in contentious-administrative proceedings, courts examine building licences granted by the City and which have been unlawfully granted due to being contrary to the plan of the municipality.

Before this amendment, when a judgment nullifying a licence of this type was handed down, usually, one of the consequences of this nullification was the obligation to demolish the works completed under the licence declared null, without compensating homeowners acting in good faith at the time of demolition in these proceedings. The only option for these homeowners was to start different judicial proceedings either against the City or against the seller of the property, which could take years to be solved and provided no certainty of recovering the investment made. We can thus prevent cases as regrettable as that of Mr and Mrs Prior.

We can affirm that, in judicial proceedings related to buildings, both in the administrative and criminal fields, thanks to these legislative amendments, homeowners who purchase or will purchase a property in good faith, not being responsible for any unlawful act, will enjoy greater protection of their assets and property rights.

Part of what we denounced and explained in an article published in 2013 has been addressed by these changes, even though there is still some way to go and more legislative changes are expected.

This legislative amendment, as the one introduced in the criminal code in March, has been made possible thanks to the work of several associations of people affected from many different areas in Spain, including: AUAN, AMA and SOHA. The continued and persistent work of these associations, their representatives and the lawyers involved have made it possible for all homeowners in Spain who are third parties acting in good faith to enjoy greater legal certainty.

Author: Gustavo Calero Monereo, C&D Solicitors, (Lawyers)

Torrox-Costa (Malaga/Costa del Sol/Andalucia)

PLUSVALIA TAX PAYMENT WHEN THE ACTUAL VALUE OF CONVEYED PROPERTIES HAS DECREASED

Geschrieben von admin am 10 Juni, 2014. Veröffentlicht in costa del sol.

Spanish Plusvalia tax decreased value property — Spanish Plusvalia tax with decreased value property

Currently, as a result of the existing conditions of real estate market, the sale price of a real estate property may be below the purchase price or slightly above it.

As regards of these situations and in connection to taxes to be paid when selling a property in Spain, it is necessary to clarify that the increase in urban land values is the first element of the taxable event of the local tax on the increase in urban land values (Spanish acronym I.I.V.T.N.U.), commonly called PLUSVALÍA. Thus, in the event of no increase, no tax may be applied, despite the content of the objective rules for the calculation of the tax provided by Article 107 of Spanish law regulating local taxation (L.H.L.), since no tax liability may arise when an essential element of the taxable event is missing.

The legal liquidation system does not preclude that the taxpayer proves in the specific case that the application of the calculation methods by the Tax Administration leads to unrealistic results. On the other hand, regarding the formula of Article 107 L.H.L., the Supreme Court ruling dated 22nd of October 1994 was conclusive when maintaining that this article was subsidiary, defending and safeguarding taxpayers. According to this Judgment “legal regulations only provide a rebuttable presumption, which is subject to be distorted in each particular case by appropriate and sufficient evidence in the above terms for the taxpayers and in conformance with the provisions of Article 385 of the Spanish Civil Procedural Law. This reasoning, in regards of the actual increase in value(plusvalía) from property sales leading to non-taxation, was also highlighted by the Supreme Court in the Judgment dated 29th of April 1996 and the Judgment dated 22nd of September 2001.

However, a recent Judgment from the High Court of Justice of Catalonia dated 18th of July 2013 also pronounces undoubtedly the fact that town councils cannot charge the plusvalía tax in the event that it does not exist, since the Judge states that when an essential element of the taxable event is missing –as for example obtaining a profit from a property sale—no tax liability to pay plusvalía tax may arise.

Recently, it is being confirmed an increase of court rulings admitting taxpayers’ appeals against tax liability in the event of loss of assets. In the words of Pablo Chico de la Camara, Professor of Financial and Taxation Law: “the caselaw of the Constitutional Court confirms the impossibility to tax a nonexistent taxable wealth by the local authorities”. This situation may occur when the transferor may certify the loss of assets on the occasion of a land conveyance. It is clear for the Supreme Court that the nonexistence of increase in land values precludes the application of the Plusvalía tax.

To sum up, the objective absence of increase of land value may lead to non-taxation, as a result of the nonexistence of the taxable event, since the legal contradiction cannot and should not be resolved in favour of the “calculation method” and to the detriment of the economic reality. Consequently, it would mean the ignorance of the principles of equity, justice and economic capacity.

These same conclusions shall be applied when an increase of the value occurs and the amount of this increase is proved to be lower than the result of applying this calculation method, being the same principles infringed.

These conclusions, which are already supported by several doctrinal criteria and caselaw, shall be considered as unquestionable at present, in view of the aforementioned economic reality.

In SHORT: when it is certified and proved in a specific case that there has not been an economic and actual capital gain from a property sale, the payment of the Plusvalia tax (I.I.V.T.N.U.) shall NOT be required by town councils.

But the reality is that Town Councils are still requiring the payment of this tax despite properties are sold at a loss, so that the judicial procedure is the only chance in this case for taxpayers to “tackle” the payment of this tax. However, when the resulting plusvalía tax payment is relatively low, it is not worth taking legal actions, due to legal costs.

For those who decide to claim, we understand that there are sufficient legal and solid arguments to obtain a favourable judgment.

Author: Francisco Delgado Montilla, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

SUCCESSFUL DUTCH REAL ESTATE FAIR FOR C&D

Geschrieben von admin am 10 April, 2014. Veröffentlicht in Andalusian, english speaking solicitor, lawyer.

As we already informed you in our previous news letter, C&D has been present at the Dutch Second Home fair in Utrecht last month. Being the only Spanish law firm on the fair, our daily seminars about the Spanish purchase process turned out to be the best attended during these three days, which proves that Spain is still a very attractive country for the Dutch to invest in. Also more than half of all exhibitors (mainly real estate agencies and developers) were focussed on Spain, which according to the organisation already has been the case for many years now.

In our stand we were able to speak to a lot of people with serious plans on buying a property in Spain, in most cases on the Costa del Sol or even particularly the Axarquia. The main issue in our conversations was to explain the important role of the lawyer during the purchase of a property in Spain. This situation is different from the Netherlands as in this country the lawyer´s work is completely done by the notary. We also got a lot of questions regarding wills and tax issues, for example on the subject of renting out a new bought property.

Author: Gustavo Calero Monereo, C&D Solicitors (Lawyers) Torrox-Málaga

Stand of C&D Solicitors on Dutch Second Home Fair in Utrecht

Our daily seminar we held in both Dutch and English and we explained the different phases of the buying process with the various legal documents there are to sign (reservation contract, private purchase contract and the title deeds). Besides of this we gave some background information on the official investigation of the lawyer, by which the future owner can make sure he´ll buy his property with all possible guarantees and free of any risks. (The extended Dutch text of our seminar you can find on the home).

Looking back we can say that this fair exceeded our expectations and has been really successful for us. Not only in the perspective of attracting new clients but also as a learning experience of presenting our company on the Dutch market. Despite of the good weather this Second Home edition in Utrecht attracted around 5.000 visitors.

Author: Francisco Delgado Montilla, C&D Solicitors (lawyers)
Torrox-Costa (Málaga/Costa del Sol/Andalucia)

C&D AT SECOND HOME FAIR IN UTRECHT

Geschrieben von admin am 21 März, 2014. Veröffentlicht in english speaking solicitor, lawyer.

erfrecht spanje — Dutch Second Home Fair

C&D Solicitors likes to inform you about the fact that we will be present at the Second Home Fair in Utrecht (the Netherlands) from the 28th until the 30th of March.

As the only Spanish law firm on this fair we´ll provide Dutch visitors with legal and fiscal information concerning the Spanish purchase process. We also have been invited to -together with our Dutch commercial assistant- give a daily seminar, which will start at 14:45 hrs. (seminar 1). After this seminar exists the possibility to ask us specific questions in the fair´s wine bar that will have a special theme on Spanish wines.

If you happen to be able to visit the fair, you can download free tickets through this link and we look forward to welcome you in our stand!

Author: Francisco Delgado Montilla, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

SPANISH PUBLIC TAX ADMINISTRATION REVIEWS PROPERTY TRANSFER VALUES

Geschrieben von admin am 7 Februar, 2014. Veröffentlicht in english speaking solicitor.

Spanish Tax Administration reviews property value

In the last few years, property market prices have dropped in Spain and the cases in which the National or Regional Tax Administration has reviewed declared values for property transfers have increased, whether for conveyance, inheritance or gifts; that is, you may sell your property for a certain and determined price, but the Regional or National Tax Administration may review that value after the sale and for tax purposes; then, it may consider that the real value of this sold property is higher than the one declared on the deed of sale, and therefore, the buyer shall pay the Transfer tax (ITP) on property transfer on the basis of the new value, which has been reviewed by the Regional Tax Administration, although the buyer had bought it for a lower price. In addition, the seller may have to declare capital gains higher than those actually obtained as a result of the review carried out by the National Tax Administration.

The abovementioned situation is legal and possible pursuant to Article 57 of Spanish general taxation law, in which it is provided that the Public Administration may check the property values by using different means.

Regarding urban properties, the Regional Tax Administraions and the Andalusian Regional Government are often supported on the grounds of an Order that is yearly approved to calculate the taxable minimum value of urban properties in this regard. As a result of this, it is possible to calculate this taxable minimum value from applying a rate provided by this Order to the details contained in the real estate tax IBI receipt (council tax). Then, you can know in advance whether the Tax Administration may claim more taxes or not when transferring your property.

Regarding rural real estate or properties with special characteristics, the matter becomes increasingly complicated, since Public Administrations may not always proceed by applying the aforementioned values and sometimes they are supported on the grounds of an expert report drawn up by technical personnel of the Tax Administration, which justifies the proven value of this rural or special property; for example, currently it is very common that the reviewed value for this type of properties is determined according to the estimated average values of construction, which are yearly publish by the Professional Association of Architects of Malaga. These values are indexed in a table containing the construction value per built square metre pursuant to the construction type and its features.

In the last year, as a result of this significant increase of value reviews by the Andalusian Tax Administration and, to a lesser degree, the National Government, our law firm always carries out an estimation of the taxable minimum value for tax purposes when advising our clients about property conveyance issues. Thus, they are warned of the possibility that their property value may be reviewed and the possible extra cost which may arise from this review. This is aimed at preparing our clients for this unpleasant surprise.

In general terms, the Andalusian Regional Tax Administration currently collects every single Euro from value reviews of property conveyances, so that if the taxable minimum value is higher than the conveyance actual value, it is quite normal that the Regional Government notifies you after a few months claiming the payment of the ITP tax on property transfer, stamp duty tax or gift and inheritance tax for the excess value reviewed.

The National Tax Administration, which is the competent body for capital gains collection of property sales, is not as determined as the Regional Tax Administration is when reviewing values. However, in those cases that the seller is not a tax resident and no capital gains has been obtained for the sale, when the 3 % withheld by the buyer is requested to be returned, the National Tax Administration does not hesitate to review the taxable minimum value of that property, so that the 3 % withheld is not returned in full to the seller. Furthermore, as a result of the reviewed taxable value, the seller may also have to pay the Tax Administration for capital gains tax, although no real gains had been obtained from the sale.

Obviously, there are grounds to challenge the property revaluations before the Public Tax Administration; however, in order to know if it is worthy to challenge it, it is important to examine and analyze each particular case in detail and determine if the reviewed value is properly justified before going ahead with the recourse.

Finally, it is also worth mentioning the possibility to file with the Tax Administration, prior to the property transfer, a binding report to obtain from the Tax Office the taxable value of this property. In some cases, it may be advisable to request this report, which commits the Tax Administration to respect it, although the value on this report will also oblige us for tax purposes.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)

RECENT CONTROVERSIAL DEMOLITION OF TWO PROPERTIES

Geschrieben von admin am 28 Oktober, 2013. Veröffentlicht in english speaking solicitor, lawyer, malaga. Keine Kommentare zu RECENT CONTROVERSIAL DEMOLITION OF TWO PROPERTIES

Controvercial demolition properties Andalucia

Last Monday October 14th, the Regional Andalusia Government Junta de Andalucia carried out the demolition of two houses which were built without construction permit on non-developable land in the rural area of Las Terreras, in the municipality of Las Canteras, Almeria.

In this case, the developer did not have construction permits to build both properties. This is a different situation from that explained in our blog post in March, but there are also involved third parties in good faith, who bought the aforementioned properties to the developer/seller. The demolition of these properties means the infringement of a fundamental property right according to the interpretation of the European Court of Human Rights (ECHR), which has demanded that:

– People affected by court or administrative proceedings which may imply the loss of their assets shall have the effective and real opportunity to defend their situation.

– Property loss due to general interest—for example, the compliance of planning legality over ownership of assets—shall be previously compensated to the owner.

Therefore, upon consideration of this European case law, it is not sufficient that in these two cases the judgment has assessed civil liability and the seller-developer is sentenced to compensate owners who bought these properties, but this compensation should be made effective prior to demolitions to avoid the risk that the seller fails to pay or is not able to pay and, as a result of this, third parties in good faith are not compensated. It should be noted that subsidiary liability of public administrations is not observed, as no construction permit was granted.

In order to guarantee the payment of compensations, appropriate actions should be taken prior to execute demolitions in the same proceedings for the enforcement of judgments. If this were possible, this situation should be determined as a reason to stop the judgment enforcement until compensations are paid to the affected owners. Obviously, each case should be analysed in order to determine whether the owner knew about the absence of construction permits and even though he was aware of the risk involved, he bought the property. In these cases, protection for these owners should be different.

Regarding certain information compiled by different means, there is a chronological perspective to be pointed out in respect of these two demolitions, which reveal the inefficiency of inspection and penalty procedures in regards of town-planning regulations, as well as the belligerent approach of public administrations participating:

– In 2004, the Andalusian Regional Government initiated a proceeding against the developer and he was fined because of the earthmovings in this area. Then, he was obliged to restore it to its original state. Obviously, the developer failed to comply with this order to restore it to its former state. In addition, the Town Council or Andalusia Regional Government should have acted in this moment, as well as they have done now, when carrying out the demolitions.

– In 2007, the Andalusia Regional Government officially ordered to the Town Council the demolition of the properties, as they have been built on non-developable land without construction permits. From 2004 to 2007, 3 years have elapsed. During this period of time the 4 properties were built and no competent public administrations did paralyze the works before they were completed. As a result of this, the completed houses were entered into legal transactions and then new owners arised. Why were construction works not paralyzed within these years?

– Once that the 4 properties were completed, the Town Council authorized water and electricity supply for them; this illegal authorization granted by the Town Council implied that these homes were appropriate to be occupied, as these supplies were essential for their sales.

– In 2012, The Andalusia Regional Government seemed to request the Town Council to execute the demolitions.

– In October 2013, the demolition of two properties was carried out by the Andalusia Regional Government, because the Town Council did not do so. The other two properties are also pending to be demolished.

Nine years have elapsed since the construction activities without permits are known until their demolitions were indeed executed. During this period of time, third parties in good faith have appeared and been affected by this situation. Have public administrations really done their utmost? Could have they acted earlier and with greater accuracy since 2004?

It would be a rather difficult task to think that the Andalusia Regional Government and Town Councils are not liable for a large number of homes built without permits on non-developable land in Andalusia—liability becomes obvious for those properties built with construction permits—since they had aerial images of each area, cadastral information and documents from the Payments Offices for transfer tax collection, which may have allowed them to protect non-developable land and enforce Andalusia town planning Act (LOUA). But they did not want to do so. Accordingly, as town planning duties have not been complied in respect of inspection and penalty procedures, the liability of Andalusia Regional Government and Town Council is joint and shared.

It is also worth mentioning the existence of certain arbitrariness on the part of public administrations when judgments were enforced, since older proceedings are still pending to be enforced and no actions are being taken on them.

Foreign residential tourism is a key factor for local economies in many areas; different national newspapers have been looked up and all of them echoed the new demolitions, which is a very harmful publicizing. They stressed the absence of economic compensations before demolitions were carried out, rather than demolitions itself.

It is not a question of implementing a general amnesty for all irregular acts executed on non-developable land without permits, since this may lead to a negative message for people who meet regulations. However, the fundamental property right should not be further infringed in conformance with the European Court of Human Rights (ECHR) case law and property right should be protected in Spain as a fundamental right. In addition a legal system which protects third parties in good faith should be provided in order to ensure legal certainty; inspection and penalty procedures should be carried out and should not go on forever due to the lack of interest of public administrations, so that their effectiveness may paralyze these type of constructions before they are entered into legal transactions; common sense and realism should be imposed and Regional Governments should be consistent with what has been accepted in these years, due to their failure to act or interminable penalty and enforcement procedures.

It seems understandable that town-planning legality will be now strictly enforced and hopefully it will be watched over. However, solutions should be provided from a logic and legal perspective for all previous cases.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Andalucia)