Illegal Holiday Letting

[NorthernLights53]

I haven't seen this mentioned anywhere on here, so thought that I'd better bring it to people's attention as it's rather important.  I'm new on here so please forgive me if this topic is already "Old Hat".

We are buying an apartment on FV, & our original intention was to conduct holiday lets for the time when we weren't using it ourselves.  We were therefore dismayed to discover that under Canarian (not Spanish) law, any holiday let from a residential complex is illegal, & carries an €18,000 fine for a first offence.  Apparently this law was introduced in 1995, but they only started acting on it in 2010 on Tenerife.  Lets over three months are OK, but any let for less than three months is automatically classed as a "holiday let" & action is taken accordingly.  The outcome has been that many people have been fined, & people who were relying on rental income to pay their mortgage are now struggling or defaulting.

The Government Inspectors have now left Tenerife, & are knocking on doors in Lanzarote, so it's a safe assumption that they will be visiting FV next, clutching their print outs from holday letting web-sites.

One of the things that has alarmed us most is the apparent total ignorance of this law amongst Estate Agents & Letting Agencies on FV.  The Estate Agent that we are buying from told us that the only requirement in order to rent is to be registered for, & paying, tax on the rental income.  We contacted two Letting Agencies, and they both assured us that we could rent from the complex without problem - since we drew this law to their attention we haven't heard back from either of them!!  In fact, there are two apartments conducting holiday lets within our complex, & I bet that neither of the owners have been told that they are breaking the law & leaving themselves open to a €18,000 fine!!

Here is a statement from the British Embassy in Madrid on the situation:

http://www.janetanscombe.com/news/british-embassy-warns-property-owners-to-ensure-they-rent-in-line-with-spanish-law.html

& here is a link to a Q & A page:

http://www.janetanscombe.com/illegal-letting-in-the-canaries

If anybody has personal experience of this law being acted on, I'd be pleased to hear from them.

[emmi]

I has been discussed here which you already know?

http://www.fuerteventura-forum.com/index.php?topic=14450.0

[NorthernLights53]

As I said, I'm new on here, so wasn't aware of that previous thread.

Anyhow, hope no harm done by raising awareness of this important issue again. 

[Captain Sensible]

This article has appeared on the thinkspain website today:
http://www.thinkspain.com/news-spain/22635/spain-may-ban-private-owners-from-letting-their-properties-to-holidaymakers

[emmi]

As I said, I'm new on here, so wasn't aware of that previous thread.

You must have a worse memory than mine as you posted at least twice on that thread!

[isleswing]

How far have you got with the purchase? Have you left it too late to pull out?

[woe10]

I`ve been here a long time. Always worked and payed all my Taxes, illegal letting is Tax Evasion, no more, no less. 

[NorthernLights53]

How far have you got with the purchase? Have you left it too late to pull out?

No, we're not pulling out - renting was just something that we were looking at as a way of covering the running costs.

We may look at three month or longer lets - because they are apparently legal as they're not classed as a "holiday let".

[NorthernLights53]

As I said, I'm new on here, so wasn't aware of that previous thread.

You must have a worse memory than mine as you posted at least twice on that thread!

I blame the tablets - can't remember a damn thing these days!!!   

[Deso]

I just put, whatever it was, down to old age. 

[Ivemovedon]

I`ve been here a long time. Always worked and payed all my Taxes, illegal letting is Tax Evasion, no more, no less.

Illegal letting of properties is not tax evasion. If you declare rental earnings they are more than happy to take the tax off you illegally let or not.They are even happy to take the tax off you when you aren't renting, ie. the non residents non rental tax. I've not heard of anyone being refused by the tax authorities the ability to pay tax on any rentals yet, have you woe?. Maybe you have . That sort of stuff only comes out of the mouths of those that have an agenda with renting,mainly hoteliers and peace and quiet seeking residents.

There are plenty of people who unknowingly have been illegally renting for years and also paying the due tax on those earnings for years as well. People that have probably paid as much or more into the Canarian tax system than a lot of the resident pensioners and black economy workers ever have. When they lose the tax income from all the private rented properties who've sold up and moved on to better investments elsewhere you better start looking over your own shoulders because you'll be the only one's left to foot the bill in their economic black hole.

[woe10]

Quote: "I've not heard of anyone being refused by the tax authorities the ability to pay tax on any rentals yet,"

Hmmmmm.  I don't think I've heard of anybody going into the tax office, and handing money over without even being asked for it. 

[Ivemovedon]

I think you know what i mean. Ever heard of money being refused by the hacienda in a rental tax return either postal, on line or even in your case delivered by hand?. No nor have i.?

And not likely to either.

[RVEEE]

To get back to the points made in the OP, if you go back to the agents under another name I'll bet that they claim again that you are able to rent without restriction.

They are a bunch of liars and are only interested in getting money out of you.

[Truncheon Meat]

You should name and shame the parties concerned so that other less savvy people can be made aware the lies they are happy to tell just to make a sale. I've heard EA's showing prospective buyers around properties on my complex assuring them that they'll be no problem in holiday lets which is total sphericals.

[fifi]

I haven't seen this mentioned anywhere on here, so thought that I'd better bring it to people's attention as it's rather important.  I'm new on here so please forgive me if this topic is already "Old Hat".

We are buying an apartment on FV, & our original intention was to conduct holiday lets for the time when we weren't using it ourselves.  We were therefore dismayed to discover that under Canarian (not Spanish) law, any holiday let from a residential complex is illegal, & carries an €18,000 fine for a first offence.  Apparently this law was introduced in 1995, but they only started acting on it in 2010 on Tenerife.  Lets over three months are OK, but any let for less than three months is automatically classed as a "holiday let" & action is taken accordingly.  The outcome has been that many people have been fined, & people who were relying on rental income to pay their mortgage are now struggling or defaulting.

The Government Inspectors have now left Tenerife, & are knocking on doors in Lanzarote, so it's a safe assumption that they will be visiting FV next, clutching their print outs from holday letting web-sites.

One of the things that has alarmed us most is the apparent total ignorance of this law amongst Estate Agents & Letting Agencies on FV.  The Estate Agent that we are buying from told us that the only requirement in order to rent is to be registered for, & paying, tax on the rental income.  We contacted two Letting Agencies, and they both assured us that we could rent from the complex without problem - since we drew this law to their attention we haven't heard back from either of them!!  In fact, there are two apartments conducting holiday lets within our complex, & I bet that neither of the owners have been told that they are breaking the law & leaving themselves open to a €18,000 fine!!

Here is a statement from the British Embassy in Madrid on the situation:

http://www.janetanscombe.com/news/british-embassy-warns-property-owners-to-ensure-they-rent-in-line-with-spanish-law.html

& here is a link to a Q & A page:

http://www.janetanscombe.com/illegal-letting-in-the-canaries

If anybody has personal experience of this law being acted on, I'd be pleased to hear from them.

                            ''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''
Hi Northernlights, the fines which have not been personally received by owners are shown on the Gobiernos website . Here is an example of 6 properties which were fined in Caleta. http://www.gobcan.es/boc/2012/202/014.html

[Truncheon Meat]

I wondered why the bookings seemed to have dropped off there dramatically from last year. Their idea of declaring it to be a hotel didn't cut much ice then.

[fifi]

Did they try and say that the villas were part of a Hotel chain Truncheon Meat?   There was an appeal lodged  a few months later for all of them.  Im not sure how they got on.  Are they the fabulous three story ones on the Mountain? I will never forget the show house. It was amazing....pure luxury.

[Blueboy7]

Hi Fi Fi, the thread you posted with reference to the fines not yet received by owners, what is that all about?i.e. why have the owners not received the fines yet? what are the fines for? I know you said it was for illegal letting, is there any other law that has been broken? any information will be greatly appreciated, very interested for my own personal circumstances.

[Ivemovedon]

Also like to know if anyone has actually paid any fines. Is there anyone on Fuerteventura who has actually had to dip into their pockets yet? Not court cases in progress or fines issued on web sites or letters sitting in post boxes. Someone must have paid something. Anyone? If they have they most certainly haven't shared their devastating experience with the rest of us yet. Anyone with any personal information please let us know about it.

[fifi]

Hi Blueboy, the Gobiernos website only publishes  fines which have not been physically served to the owners as far as I know.  There is usually a period of 15 days to appeal after it is posted on the website.  You can enter your NIE number on the site and do a search to see if you have been fined for anything.  I have read that this is not always reliable though. The "illegal letting" fines are usually for things like not having a complaint book and not having a Tourist inspection book.  It is impossible to have those if you are not legal.

[Ivemovedon]

OK maybe i should rephrase the question. Has anyone on the island actually paid a fine for lack of complaints book or inspection book. Fi do you know of anyone in caleta who has actually been prosecuted for this type of offence and paid the subsequent fine. You know a lot of folk in the resort and if you don't know then probably nobody does. I'm not trying to stir the water here but any concrete evidence would be much appreciated.

After all this has been going on for some considerable time now.

[fifi]

Hi Stedge I dont know anyone personally who has been fined or paid a fine.

[Blueboy7]

Thanks for that Fi Fi, its appreciated. Being a person that is easily confused (age thing), as I understand it, the Canary Island law is at present  - you are not allowed to rent your property out as a short term holiday let otherwise you can get fined up to 18,000 euros, it is lawful to rent your property out for periods of three months or more, is that correct?? sorry to be a pain Fi Fi, and I know this subject has been thrashed senseless on this forum, its just that I have read so many conflicting articles on the subject it blends into confusion, I think its to do with overall Spanish Law, Regional Law, Local Authority implementation etc etc. You seem to be right on the ball with these things for Fuerteventura.

If the above is correct, do you think you could get away with advertising to let people use your property for free, and rent them the furniture for, say 400 euros per week?
only joking.

[fifi]

Long term letting of three months or longer is fine Blueboy on a residential complex. Holiday letting through the sole agent for a Tourist status complex  is also allowed if they have at least 50% plus one of the units on their books. No private adverts are allowed.

The new letting laws should be out by June so we will have to wait a while to see what changes are being made.

[Ivemovedon]

Hi Stedge I dont know anyone personally who has been fined or paid a fine.

Thanks fifi. Maybe eventually someone will spill the beans

[Truncheon Meat]

Did they try and say that the villas were part of a Hotel chain Truncheon Meat?   There was an appeal lodged  a few months later for all of them.  Im not sure how they got on.  Are they the fabulous three story ones on the Mountain? I will never forget the show house. It was amazing....pure luxury.

They're on the left half way up the hill after Travellers Rest. Put these co ordinates into Google earth and it will take you there. 28.402338 -13.876213. They're nothing out of the ordinary really, just the usual grossly over priced stuff.

They actually advertise themselves as a hotel on various websites such as Trivago but obviously they're not so I figure they were just trying to find a way round the law. Doesn't seem to have worked. A friend of mine owns on there and they were all built as residential and not touristico.

[fifi]

I think they are the ones I viewed Truncheon Meat. They had an open section in the centre of the house and some of them had big patios on two different levels. They were being sold as Residential allright.

[Blueboy7]

Thanks Fi Fi, I now have a lot clearer picture of the situation combining everything together.

[emmi]

I think these are the ones mentioned in the bulletin

http://www.villascastillo.com/