Hi just heard from Admin that non residents property tax (wealth tax ) is to be revalued , with large increases for yr 2015. Anyone heard anything about this
i have paid my non residents tax, and wealth tax(abolished about five years ago) and i have got to say if this goes up it might be the last time i pay it in my twelve years of ownership . Lots of non residents don't pay this, on my last visit i was told that i should have a better assessoria, it is not a necessary tax and i had been duped. There is too much discrimination towards non residents, water bills, discounts on restaurants etc and lots of other things, patience is wearing thin!!!!
Mine has increased by 50% this year. I am told that if values in your municipial area have not been reviewed in the last 10 years, you will now be paying tax on an "assumed" income of 2% of the cadastral value ( previously 1.1%)
I had read some time ago that this tax was being discussed in the European Parliament as thought to be discriminatory against non residents, but nothing seems to have been done.
Company i use , want to charge me 75euros to sort my wealth tax out for me , has anyone any info on how to do this themselves.
Quote from: valiant on November 01, 2016, 14:15:34 PM
Company i use , want to charge me 75euros to sort my wealth tax out for me , has anyone any info on how to do this themselves.
Search on my user name have posted loads on how to complete yourself.
Online form is here :
https://www2.agenciatributaria.gob.es/es13/h/ie32100b.html?idi=EN
I recommend you to go to this site with Internet explorer (IE) as it needs Java and sometimes as chrome doesn`t use java it can be a problem to load the page.
Further information can be found by search my posts on here or by going to page 2 of the website below :
http://www.andalucia.com/forums/viewtopic.php?f=41&t=25714&start=30
Important information to complete the form is ;
'Determination of the taxable base amount'
Box [04] Your valor catastral multiplied by 1,1% (2% if the last revaluation was prior to 1994)**
Box [21] 19.5% (See under heading Applicable tax rates below)THIS will be 19% next year
Box [22] The result of taking 19.5% of box 04
Box [23] Enter 0 or leave blank
Box [24] Same as 22
Box [25] Box [26] Box [27] Leave blank. This tax is not covered by the double taxation agreement.
Box [28] Same as 24
Box [29] Box [30] Enter 0 or leave blank
Box [31] Same as 28 (boxes 22, 24, 28 and 31 should show the same amount)
**This will change in respect of declarations made in 2016 for 2015 and the percentage will depend on when the most recent catastral revision was carried out (1,1% up to ten years ago and 2% more than ten years ago). More details to follow.
Please note that the amount to be entered in Box [04] is NOT the valor catastral but the result of applying the multiplier (1,1% or 2%). If there is more than one person named in the escritura a return is required from each person. The amount to be entered in box 4 is halved if there are two owners, divided by three if there are three and so on. So the formula to obtain the amount to be entered in Box 4 is:
valor catastral times 1,1% (or 2%) divided by two (or however many owners there are). This is 2% for La Oliva
Any questions post here or pm me.
My property is in Caleta, any idea if Antigua is rated at 2%. Thanks beachlife for some great info .
I was told if you didn't pay this discriminatory tax when you sold, all past non payment would be assessed and regained from you on eventual sale of the property.
Well i can safely say it's a load of bull. We sold 5 months ago and never heard zilch about it.
Don't be fooled. It's a non enforced gravy train for solicitors and local government..
But can they come onto you for payment at any time
They'd have a hard job if you have no money in your Spanish bank account.
There is a 3% retention when you sell your house which goes to the taxman as below,
"If you are non-resident in Spain, the buyer of your property will also have to retain 3% of the Escritura Sales Price to pay directly to the Spanish tax man (Hacienda) on your behalf towards your Capital Gains Tax. Fiscal residents do not have any retentions made on them, but they may have to pay tax on the sale in the following year through their tax returns.
Obviously you will still have your Capital Gains Tax Liability, but that will depend on your profit. For non-residents, the 3% retention tax counts towards this. Those of you who are making a loss still have to pay out the 3% retention tax, but can reclaim it back from the Spanish tax providing you have all the correct documentation and receipts to prove you have made a loss and paid all your annual taxes."
Don't forget to claim it back if you sold at a loss, although it does take time, possibly years.
One thing I've learnt over many years is its better to have the taxman chase you for the money rather than the other way round. Make your choice...it's up to you.
Also have to say I was never at any time in the sale asked for any documentation or receipts regarding anything at all
As I said what you read and what actually happens can be a world of difference. Up to you what you want to believe.
Another reason not to buy property in Fuerteventa, if the rules/laws were like the UK we would have a place there now.
I'm afraid it's not the Spanish that are the problem. Far from it. Its when you declare your capital gains on Spanish property in the UK is when the brown stuff hits the fan.
If you click onto enquires@spanishtaxform.co.uk, this guy completed my annual Non Resident tax form for me annually, he charges £25 and you need to provide with you castural value of your property. To claim back you 3% retention from the tax office(Non Resident Property Sale), form 212 must be presented to the Las Palmas tax office within 3 months of the property sale. You can put it in at a later date but apparently they fine you??????? the chances of getting this illegal retention back are slim, you can supposedly get it paid into your Spanish or UK bank account, obviously provided you do not owe tax and have not made a profit on the sale of your property.
Quote from: valiant on November 01, 2016, 19:20:00 PM
My property is in Caleta, any idea if Antigua is rated at 2%. Thanks beachlife for some great info .
If the VC was re rated in the last 10 years you pay 1.1%.
You can check when your area was re rated for VC at this link (leave 1st box for all years, 2nd box put Las Palmas then in 3rd put your municipality in your case Antigua)
http://www.catastro.meh.es/esp/ponencia_valores.asp
This shows your VC was re rated in 2002 so you will need to use 2%.
I used Spanishtaxform first year, and recommended on this forum, but now do it myself following Beachlife's guidance. Thanks Beachlife.
Piece of cake now and save â,¬50/year.
Quote from: archer101 on November 01, 2016, 22:11:11 PM
I used Spanishtaxform first year, and recommended on this forum, but now do it myself following Beachlife's guidance. Thanks Beachlife.
Piece of cake now and save â,¬50/year.
De nada
If you want to pay that tax then feel free to do so. But you don't. Heard it all on here over the years..you must pay this you must pay that...they will be after you for this if you don't pay that. Watch out for this or your in trouble...Load of baloney. Best one ever was the Canarian version of project fear. The rental inspectors are on their way and going to knock on your door with a 50000 euro fine yeah right. We all want to keep on the right side of the law but for heavens sake stop making owning a property sound like its world war 3
Think we all have the message HTT. Feel free to do what you want and believe.
At the end of the day, you do what you feel is right for you and others will do what they feel is right for them. The only time we will find out which is the correct path to follow is when we have sold. You assessment saying you don`t have to pay the tax is based on what evidence! Lots of people don`t pay road tax in the UK, so does that mean you don`t have to pay it!
I`m making an informed decision on my own research and not on listening to people telling me to either pay it or not pay it. My research means that I will have to ignore you feelings about the issue. As based from what you say, you decide what you will do regarding the NRT on general rumours not based on facts. I can see why you feel that the non resident tax is another rumour which you are classifying as empirical evidence to make your informed decision.
Not sure about owning a property being like WW 3 (where did that come from?). Rather the opposite. I`m trying to tell everyone completing the form is a very easy and no need to pay anyone to do so.
I'm doing the same myself beach life. I can only go by what I have experienced myself. I nearly started paying it myself after listening to talk on here. Very thankful now I followed my instincts and took no notice apart from an old financial advisor forum member called merlin from years ago who said it was unjustified and non enforceable. I stand by what I said that there's too many on here frightened of their own shadows when it comes to Spanish authoritarianism.. fact is any tax regulator in the world will take it if you offer it .
Won't say anymore on this as I'm obviously upsetting some on here.
But I will bow out with a saying dear to my heart.
Any man that says he pays tax that he doesn't need to is either a liar or a fool.
Big noises were made of the reductions in the headline tax rate from 24.75% down to 19.5% but the introduction of the 10 year revaluation rule was kept quiet. The net effect for those of us subject to the new revaluation rule is a big increase in the non-residents property tax. However this is not the same as the wealth tax as the OP says. Non-residents are not subject to this.
I am interested to hear evidence of lower utility rates for non-residents. It is not something I have seen any evidence of.
Quote from: Deso on November 01, 2016, 20:09:18 PM
There is a 3% retention when you sell your house which goes to the taxman as below,
"If you are non-resident in Spain, the buyer of your property will also have to retain 3% of the Escritura Sales Price to pay directly to the Spanish tax man (Hacienda) on your behalf towards your Capital Gains Tax. Fiscal residents do not have any retentions made on them, but they may have to pay tax on the sale in the following year through their tax returns.
Obviously you will still have your Capital Gains Tax Liability, but that will depend on your profit. For non-residents, the 3% retention tax counts towards this. Those of you who are making a loss still have to pay out the 3% retention tax, but can reclaim it back from the Spanish tax providing you have all the correct documentation and receipts to prove you have made a loss and paid all your annual taxes."
Don't forget to claim it back if you sold at a loss, although it does take time, possibly years.
3 years on and still no repayment :o >:( >:(
Little surprise there.
I'm not sure what the 3% retention fee on a sale has to do with non residents tax. The reclaim is only on any capital gains difference between buying and selling. You cant reclaim non residents tax. Once its paid its gone. end of story. The only taxes you pay are the 3% of asking price and a few minor local government taxes.
Quote from: Holierthanthou on November 03, 2016, 11:33:13 AM
Little surprise there.
I'm not sure what the 3% retention fee on a sale has to do with non residents tax. The reclaim is only on any capital gains difference between buying and selling. You cant reclaim non residents tax. Once its paid its gone. end of story. The only taxes you pay are the 3% of asking price and a few minor local government taxes.
So what happens to you if you fail to pay non resident tax?
Non-resident property owners in Spain who fail to pay on time their NRT are subject to firstly a late payment fine of between 5%-20% and further to which a 5% interest rate of the total amount. In addition to this late payers can expect to receive follow up letters from the Spanish tax office which are all independently priced and which can cost as much as â,¬72 per letter. In cases where non-payment has been identified, legal court action can be raised against the non-payer meaning further costs.Of course you can live in Spain for years and the tax office don`t investigate everyone as many people on here can verify.
However the Spanish tax system knows that most non residents who have a property will either sell or die. If you sell the retention fee will then be used after investigating your tax liabilities and on death you will have inheritance tax to pay where other taxes will be used to assess your liabilities.
Therefore when the 3 % retention fee is lodged the due taxes for NR will be taken from the 3% retention fee plus penalties judged by the AEAT (I suppose depending on the period of time you didn`t pay the tax). Which is why its relevant to the question on whether its worthwhile paying the tax or not.
You can of course ignore the tax as advised by HTT. Perhaps the Spanish tax agency are stupid and just set up a form just to see if any one would pay it. Either pay the tax or roll the dice.
I like to remember Al Capone when considering taxes.
I was led to believe (rightly or wrongly) that they can only go back 5 years. Perhaps someone can clarify this?
I was told that by my solicitor .. so if you have refused to pay they can only claw so much back anyway. As said its a personal thing. Everyone makes their own choice. By relating what happened in my recent sale i'm just hoping to add another angle to that choice.
Holierthanthou, my brother in law was of the same thinking of you for many years . He owned a place in tenerife , one day the taxman cometh knocking. He paid back big time with extras added on, plus the big bill he had from his solicitor to sort his mess out. Remember unlike the uk , many spanish debts are not sought right away ,they let them grow with extras ,until its a big fat wad , THEN they come after you
I've heard too many stories like that to get too exited by it valiant.
Seems a pretty poor strategy to me..if they leave it too long it's highly likely the victim has sold up and skeddadled while they have been waiting in anticipation. Nevertheless I don't say what your relative went through isn't true.Fact is I'm not anti tax and have always paid my dues. But this particular one is a rogue and despite whats been said on here i have heard otherwise elsewhere.On my sale documents my 3% is regarded as non residents property tax not pertaining to the local population ..money which I am highly unlikely to ever retrieve if I overpay, and this happens to many people. And they want an annually paid non residents tax on top?. That's just milking foreign owners and they know it. I'm not advising anyone to do anything..just informing of my experience.
We are just buying at the moment & the solicitor has said they will set up direct debits for utilities & non residents tax so doesn't look like we have much choice in the matter
Surprised about non resident tax. It is driven each year by the owner submitting the form along with payment at the bank. Direct Debits are usually driven by the recipient
Quote from: DaveW on November 03, 2016, 19:19:38 PM
Surprised about non resident tax. It is driven each year by the owner submitting the form along with payment at the bank. Direct Debits are usually driven by the recipient
Maybe I have it wrong. I thought that was what they said. I am over in a few weeks to finish things off & get the fitting out started so will check then, thanks DaveW
Hi Spitfire
I think it is more likely to be for IBI and Basura taxes rather than non-residents tax. (The equivalent of council and rubbish collection taxes.)
Enjoy your property!
I think you are confusing the non-residents income tax with the setting up of direct debits for the Council Tax (which is split in two, the IBI and the Basura). Most have these two taxes set up as annual direct debits and in La Oliva they are both taken on the same day in June or July each year.
The non-residents income tax is a self assessment form which needs to be submitted within 12 months of the end of the tax year in question (so right now people are preparing to pay for 2015).
Some people prefer to instruct a third party to fill this form out for them. Others are happy to do it themselves.
It may seem crazy that non-residents have any income tax to pay at all if they don't generate any income in Spain, and indeed it is. The sum payable is based on the Valor Catastral which is the rateable value of the property and needs to be found at the Ayuntamiento. This value is much lower than the market price.
The net result is that the two Council Taxes direct-debited each year are low (admittedly for not a lot but they are still low) and then a crazy, irrational but usually fairly modest amount needs to be paid directly to central government in income tax as explained above. Adding these taxes together still gives a total tax which is fairly modest (admittedly for not a lot) and this alongside electricity, water, any community fees and finally the costs of having a Spanish bank account to pay these bills are the total annual running costs of owning a property in FV when non-resident.
I see Tamara beat me to it :)
Thanks For the excellent post Ernie. It explains a lot.
Thanks also to Tamara for yours :D :D