Has anyone else had to pay Property Revaluation Tax in Tenerife?

[AlBondigas]

I just wonder if there's anyone else that has been clobbered for this Property Revaluation Tax?
It's something the authorities can do if you paid under the asking price of your property, they can invoice you up to 4 years after the purchase for their missing 10% on the difference between the paid price and the agent's selling price.
I paid 30,000€ under, so they want nearly 3,000€ out of me and so far, I've found no way around it.
Is this just for the English I wonder?
I hate the thought of being discriminated against, but I don't think the Spanish would pay it, they'd just ignore it I guess and just not pay BUT, I further guess there would then be an embargo on the property in question and the sum would increase at a percentage and further fines for non-payment?
I'd appreciate anyone telling me of their experience with this so called 'tax' which, to my mind, seems to be a scam? Surely, an item for sale, (either big or small) is only worth what someone's willing to pay for it and if they get a bargain, then it's bully for them, it happens with just about any sale.
I might add that this revaluation tax was never pointed out to me at all when purchasing my property 4 years ago, plus it seems that estate agents and some solicitors know nothing about it - how convenient!

[cathys]

Never heard of this one. All sounds a bit suspicious. How can they possibly know what the
original asking price was - especially from 4 years ago. I would make some serious enquiries
with your abogado before you cough up any money for this 'tax'. Be interesting to know how
you get on, Keep us posted.

[junglejim]

SuzyQ on here posted about this some time ago , she was billed fromthe Hacienda - pm her she may be able to offer some advice .

[kathml]

If you pay under what the authorities judge is the market price for a property they have the right to ask for the tax on the difference whether from the buyer or the seller I'm not sure Would guess the buyer as they can embargo the property

[AlBondigas]

Thank you JungleJim, but according to her page, SuzyQ hasn't been seen on here since September last year.

[Rickiebear]

Hi, there was a trend a few years ago, where a buyer would pay part cash to the seller, and part via the final sale. Thereby avoiding tax. It maybe that in your case this is what the authorities think happened. I am sure if you produce the original sale particulars and a letter from the original Notary, you will be able to clear it up.

[AlBondigas]

Thank you JungleJim, but according to her page, SuzyQ hasn't been seen on here since September last year.

[golf birdie]

it is quite common. I know of a few who have had this to pay, a good lawyer would of told you it was possible when you purchased.

[AlBondigas]

Thank you Rickiebear, your suggestion does seem like a logical way to definitely prove the transaction was a legitimate one, but surely my solicitor would have thought of this straight away?
I have all the documents in a special folder so I could actually prove the purchase was a straight one.
Interesting food for thought . . . . thank you

[junglejim]

From what I remeber SuzyQ paid the asking price but the Hacienda claimed the tax on their estimate which was higher , I think she challenged but can't remember the outcome
She is also on the Facebook option of the forum - ask there too !

[TenerifeTeddy]

Up to fairly recently there was a common fraud and black money changed hands, where the value of the property on the escitura was stated as less than the actual sale price, and the difference was paid in cash to to avoid tax.

To get round this the government assess their own value of any property and apply tax to the difference. We got hit by this when we took a loss on selling our second apartment in 2010, and then to really rub salt in it, got taxed on the difference in their valuation and our actual sale price. You can argue the case, but unless it is many thousands the legal fees and expenses usually add up to more than the tax.

[Norm de Plume]

I've had to pay it. The sale price in my case was in settlement of a legal dispute. I have appealed it, but so far heard nothing. If the appeal is not successful, I can ask a Court to look into it (at a price).
The safest thing is to pay it and then appeal it. They can embargo the property and your bank account.

[doreen]

Yes, I was caught by this too for one property ... - luck of the draw really, for another property I bought for less in the same complex was not assessed. Do not ignore it ... either challenge or pay. In my case, it was an extra 1,000 or so, which probably would be the cost of a lawyer to challenge, so I just paid up as it was a bargain price for the property.

[Suzanne]

family have just bought a property and the price they paid is well under the rateable value on the IBI. The property was valued at aprox 150.000 euros and bought it at an excellent price less than 100.000euros, but was told that the hacienda may pick up on it and come back to them within 4 years. If they do and we have to pay the extra tax it is still a bargain price. All property has a value and if it is sold below this price then the hacienda may come back on to you.

[seanocelt]

this almost reads as, if you buy a bargain or repo, expect to pay more later. Suppose you could factor that into any offer you make?

[Jabba43]

We bought a house renovation job, have lots of pics to show the state it was in. Got a good deal and declared the full sum, no cash.

I guess if stamp duty was half the current rate people would be less inclined to try and cheat though, 6-8% depending on where you live in Spain is bit of a sick tax. Was something on it in the daily wail last week

http://www.dailymail.co.uk/news/article-2607465/Stamp-duty-warping-housing-market-As-number-homes-sale-plummets-experts-attack-vindictive-tax.html.

For us it was an extra 17k, ouch and the thought of them coming back to take more makes my blood boil.

[kingbaker]

this almost reads as, if you buy a bargain or repo, expect to pay more later. Suppose you could factor that into any offer you make?

Has anyone tested this in the courts, as you would be punished for a previous owners fraud? :confused: :(

[Jabba43]

Has anyone tested this in the courts, as you would be punished for a previous owners fraud? :confused: :(

The only way would be if they could actually prove someone took cash, almost impossible.

[kingbaker]

The only way would be if they could actually prove someone took cash, almost impossible.

Thats my point! Most buyers wont even know the previous owners.

Court cases are supposed to be about EVIDENCE. :(

[Jabba43]

Thats my point! Most buyers wont even know the previous owners.

Court cases are supposed to be about EVIDENCE. :(

Yes you are right but many high taxed countries do this. For example in Finland you have tables of how much cars "should cost" so even if you buy it for a good deal it does not matter, they tax you on the table amount. With the government you are always perceived to be guilty until you can prove otherwise :)

[princessmonika]

what is the difference between the non resident tax, they can go back 4 years to pay --- and the revaluation tax???????

[golf birdie]

I was told about this many, many years ago when I brought. As I posted before, a GOOD lawyer would have told you. The problem here is many buy without having legal advice thinking they will save money. Never buy without a lawyer, it pays in the end.

[princessmonika]

yes i bought through a lawyer and yes it is the best way --

[CIM]

I've had to pay it. The sale price in my case was in settlement of a legal dispute. I have appealed it, but so far heard nothing. If the appeal is not successful, I can ask a Court to look into it (at a price).
The safest thing is to pay it and then appeal it. They can embargo the property and your bank account.

I'd be interested in the outcome of your appeal. I think it is very unfair to be taxed this way. It is essentially labelling all buyers and sellers as dishonest criminals and fining them for it!
Same goes for non-residents letting tax at 24.75% of Gross, higher than residents which I thought was illegal under EU law due to discrimination.

[golf birdie]

I'd be interested in the outcome of your appeal. I think it is very unfair to be taxed this way. It is essentially labelling all buyers and sellers as dishonest criminals and fining them for it!
Same goes for non-residents letting tax at 24.75% of Gross, higher than residents which I thought was illegal under EU law due to discrimination.

to me its the same as buying a second hand car here. They set the value and thats the end of it no matter what you paid for it.

[Norm de Plume]

I'd be interested in the outcome of your appeal. I think it is very unfair to be taxed this way. It is essentially labelling all buyers and sellers as dishonest criminals and fining them for it!
Same goes for non-residents letting tax at 24.75% of Gross, higher than residents which I thought was illegal under EU law due to discrimination.

Non-residents can now deduct legitimate expenses as a result of my complaint to Brussels.

[CIM]

Is there anything online for reference? As many touristic complexes don´t seem to be aware of this and either deduct nothing before tax or deduct only a few things - certainly not deducting everything. When did this change? Thanks.

[Norm de Plume]

These have been deductible by citizens of other EU countries since 1/1/2010.
They are set out in Act 35/2006 and referred to in the instructions for filling in the Modelo 210.

[AlBondigas]

I don't think it's actually changed as such CIM, it's probably always been t/here and it raises its ugly head for a chosen few and me being one of the lucky ones. Nearly 3,000€ takes a lot of saving for me, I hate the thought of virtually dropping it down the drain.
One of the suggestions here is to pay it, then argue about it afterwards - but once you pay it, there would be no fulcrum, no leverage, they have the money, I'll be on the back burner forever!
Making up the 3,000 is a fine as well, probably for late payment!
I really don't get it at all, but I'm not worrying about it, I just think it's very unfair and that I should have been informed so as to prepare myself financially.

[bonitatime]

This has always been around it is just more painfull when you Really under paid instead of just declaring
15 years ago we borrowed more money than we declared on the purchase (previous owner was a bank) and got taxed on the difference later

[Peanuts]

I think it was mentioned earlier, the way of thinking is that the house like a car has a certain value and this value is taxed independently. Even if you had a "good deal" and paid less than the value estimated by the hacienda. The hacienda collects all the tax it believes it should have. This is based on the average of all house sales and prices in the area.

But, food for thought, supposedly when you currently buy a repossion from the banks this does not apply as the court process and bank sale confirm the real value of the sale. Interesting to see if this information is correct.

- - - - - - - - - - merged double post - - - - - - - - - -

I think it was mentioned earlier, the way of thinking is that the house like a car has a certain value and this value is taxed independently. Even if you had a "good deal" and paid less than the value estimated by the hacienda. The hacienda collects all the tax it believes it should have. This is based on the average of all house sales and prices in the area.

But, food for thought, supposedly when you currently buy a repossion from the banks this does not apply as the court process and bank sale confirm the real value of the sale. Interesting to see if this information is correct.

[Norm de Plume]

Apparently my appeal went to the appropriate Tribunal on Feb 21st and is awaiting a hearing. In the meantime they have my money.

[AlBondigas]

I didn't pay them, I thought it was best to argue the toss while I still had the money.

[Westminster]

This can happen in the UK as well, if the Revenue consider that a property was sold for less than market value they can impose Stamp Duty on the difference, and impose a penalty as well.
It may be prudent to consult your Lawyer, and if possible, plead poverty, they may give you time to pay.

[AlBondigas]

It was my Lawyer that they wrote to, he was the person who did the conveyancing for me and with respect to him, he didn't ever mention this extra tax I might have to pay up to 4 years hence.

[9PLUS]

Can you make Payment under duress here?

[Norm de Plume]

You can pay and still appeal, if that's what you mean.

[Norm de Plume]

I am still waiting for any response to my appeal and have now complained to the Defensor del Pueblo.

[Norm de Plume]

I am still waiting for a response to my appeal, and for any sense out of the Ombudsman. Useless jobsworths!

[Norm de Plume]

Aftér numerous unanswered emails asking what was happening, I complained to the Defensor del Contribuyente who tells me they have no record of my appeal! AEAT are even more useless than TalkTalk. I shall continue to pursue this matter.

[essexeddie]

Most of the authorities in Spain are useless. Jobsworths.
I tried to pay some money in my Spanish bank today. After waiting half an hour I was informed the computers were all down and to come back another day. They wouldn't last two minute's in the UK. They are abysmal.

[Norm de Plume]

Apparently my appeal went to the appropriate Tribunal on Feb 21st and is awaiting a hearing. In the meantime they have my money.
They now say that they have no record of my appeal, despite the fact that I sent them 4 emails asking what was happening. All unanswered.
Not just incompetent but dishonest!

[essexeddie]

They now say that they have no record of my appeal, despite the fact that I sent them 4 emails asking what was happening. All unanswered.
Not just incompetent but dishonest!



Are you surprised. It doesn't me. Looks like you have your work cut out.