British Embassy press release/ re buying or renting out property in Spain

[fifi]

http://ukinspain.fco.gov.uk/en/help-for-british-nationals/living-in-spain/property-in-spain/before-you-buy/renting-out-property




British Embassy warns property owners to ensure they rent in line with Spanish law
4 August 2012

The following is a press release from the British Embassy:

    Homeowners who rent out their properties to holidaymakers are being warned they could face huge fines unless they comply with Spanish law.

    The British Embassy has become aware of a number of cases where homeowners have been fined up to €30,000 for letting properties without the correct permits.

    The Embassy has today (Monday) published advice for homeowners who rent out their properties or are considering doing so, which can be found on the UKinSpain website.

    Short-term lets:

    The regulations on letting tourist apartments (apartamentos turísticos) and holiday homes (viviendas vacacionales) vary by region. If you are planning on making a financial return by renting out your existing property, or buying one to let, you are recommended to seek independent legal advice and check the local licensing laws with your local town hall (Ayuntamiento).

    This is particularly important in Catalonia, the Balearic Islands and Canary Islands where the rental of holiday properties on a short-term basis is strictly regulated. The authorities in these areas are cracking down on homeowners who rent out their properties to tourists (particularly through online adverts) without complying with Spanish law.

    If you own or are planning to buy an apartment which is part of a Comunidad de Propietarios (Committees of property owners who are responsible for the management of communal areas of apartment buildings/complexes), you should also check whether there are any rules that prohibit or restrict short-term letting.

    Long-term lets:

    Owners who rent out properties on a long-term basis are generally not required to apply for a special licence. However, it is worth seeking professional advice to make sure that you are complying with Spanish legislation and that you are using the correct rental contract.

    There are different types of contracts depending on how long the property is being let for, such as arriendos de vivienda which are for a minimum of five years, and arriendos de temporada which are generally for one year or less.  You can get copies of these contracts from tobacconists (estancos).

    Taxes:

    Owners of properties should also be aware that whether or not you are resident in Spain, you will need to declare rental income to the Spanish tax authorities. Homeowners may wish to seek advice from a professional tax adviser (asesor/gestor).

    Managing a property rental:

    You may want to consider hiring a Spanish letting agent to assist with finding tenants, drawing up rental contracts and managing the property on your behalf.

    Further information:

    Advice on renting out property in Spain on the UKinSpain website

    FAQs on letting property in Spain (in Spanish) from the Sociedad Pública de Alquiler (Public Rental Society)

[SurfJames]

Better late than never!!!

The problem with owning property abroad, is that you become a victim for taxation. These fines are little more than a tax against a group of individuals who reside in Spain, but have no voting influence.

[fifi]

Yes it did take a couple of years.

Well you know my opinion by now. I have learned the hard way. Long term renting is so much better than buying a depreciating asset.... no fear of fines, no taxes, no upkeep, no IBI, Basuras, no Community fees etc.

I wish I knew all this five years ago.

[moonraker]

Having got nowhere trying to get relevant info regarding renting out from the powers that be, I finally decided to write to the PM. The letter we have received back from his office states that our letter and concerns have been passed onto the Foreign and Commonwealth Office for them to look into our situation as they are best placed to try to sort this out........

I will keep you all informed of any progress/response....

Mawbeef 

[fifi]

Excellent Mawbeef. Looking forward to hearing their reply.

[fuerte crazy]

What are the quidelines for F&F's using a place on a residential area.  Surely people should be able to let their friends and family members use their holiday homes without fear of fines.  Does anyone know the do's and don'ts when it comes to this as alot of what has been covered refers to holiday home renting on complexes without touristic licences.  For example how far can you go with letting friends use a place as long as you aren't charging them by that I mean how far can you go when it comes to classing people as your friends as most people have differing levels of friendship like very close friends to good friends.  The same goes for family.  You can have your immediate family, then siblings and their families so where do you draw the line when it comes to letting them use a place.  How would you stand legally if for instance the inspectors called and you had friends staying in your place and when asked they said they were friends of the owners, would this then be acceptable or not.
Any info would be gratefully received by alot of owners on here who have properties on residential areas.
Thanks
FC.

[fifi]

Hi Fuerte crazy Janet Anscombe the campaign leader was asked a similar question recently. She is working alongside a team of Lawyers and therefore her advice can be trusted.   (copied from her website)....

david says:   
16 July 2012 at 5:49 pm   

'owners are allowed full private use of their properties, incuding having personal guests.'
Thanks Janet, this is the part I'm getting conflicting reports on – from being told its ok as long as you haven't accepted payment to friends and non-immediate family are not ok and you will still be fined. The inspectors want proof and the onus is on you to prove they are family / friends!!! Does anyone have any experience / evidence of inspectors calling and challenging friends? What do you suggest response to inspectors is? Or is there anything in the law that covers this?
Janet says:   
16 July 2012 at 6:47 pm   

Imagine you have a car in the UK. You would lend it to a friend, and you'd consider it just the same as if you were driving it yourself. You wouldn't lend it to me, though, would you? Your friend's use, though, would be private to you because it would be a personal friend.

It's the same with your apartment here. If the inspectors call when your friends are there they say they are your personal friends, and if asked if they have paid they say no because it's a private loan by a friend. It is your own usage whether you are there with your friends or not. Bear in mind that inspectors can return to a property, and if they find "friends" there week after week it would not be plausible – even if it were actually genuine!

What is not allowed is for you to have people there whose presence cannot be defined as your own personal use. These people generally pay, too, and generally they are not people you would share the apartment with! It's not only about money – it's the "commercial exploitation", making your property available to the public. That generally means a payment, of course, but it doesn't actually need to involve one.

Does this help clarify?

[fifi]

I was in touch with the Irish Embassy this morning to see if they would be putting out a similar press release to inform Irish people about the enforcement of the law. This is their reply....


   
12:22 PM (53 minutes ago)
      
to me
Dear Fiona

The Embassy has not issued a press release on this specific topic. In the section of our website (http://www.irlanda.es/home/index.aspx?id=34050#buying) dealing with "Living in Spain" we emphasise the importance of seeking independent legal advice when purchasing a property:

Buying a Property in Spain
It is very important to obtain independent expert legal advice before buying a house or property in Spain. The Embassy and Consulates have lists of law firms where English is spoken (the webpage for each consulate has lists of lawyers for their region: http://www.irlanda.es/home/index.aspx?id=33980). You might also find it useful to consult a manual such as "You and the Law in Spain" (David Searl; Santana Books) or "Working and Living in Spain (Harvey Holtom; Cadogan Guides).

Kind regards


Embassy of Ireland

Madrid



http://www.irlanda.es/



All Irish citizens travelling or living in Spain, Andorra, or Tunisia are invited to register with the Embassy via the website of the Department of Foreign Affairs www.dfa.ie



If you are interested in becoming a member of the Spanish Irish Business Network (SIBN) please contact us at madridembassy@dfa.ie



Follow us on Twitter https://twitter.com/#!/IrlEmbMadrid

[Voldermort]

Dont hold your breath anyone for action from the FCO in London. They have a blind spot when it comes to Spain and they wont do anything to rock the boat between Madrid and London. This can be evidenced by the nightly incursions into Gibraltar waters (also British)by Spanish fishing boats, escorted closely by the Guardia uncivil, who ignore the Royal Navy vessels that are there..2 weeks ago 2 locals got hi jacked in home waters and taken to Algerciras by the uncivil and later released.....

  The FCO response???...zippo, zilch, nada...hope I`m wrong but think this property issue will go straight onto the `too hard` pile and there left to rot. Utterley frightened, PC, incompetent numpties......................................................other than that of course they are fine