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02-25-2011, 11:24 AM
Spanish Property Non-Resident

My wife and I have owned an apartment in Denia, Spain since July 2003.

I pay local taxes for refuse collection and rates by Direct Debit, and I would like to know what other taxes/costs, if any, I should be paying or will pay on sale.

I have been told that there is an income tax (Renta) based on Catastral value and a wealth tax (Patrimonio) which was abolished in 2008, neither of which I have paid. The income tax would have been 162.94 euros and 155 euros for my solicitor to prepare and submit for 2008, and the wealth tax would have been about 400 euros per year.

I have been told also I should have a Spanish Will as well as my English Will, and this would cost me 150 euros for my solicitor to prepare.

I have been told also that on selling my apartment, there would be a 3% retention held for 1-2 years, pending calculation of any taxes I owed, and that unless I have paid the income tax (Renta) referred to above for the previous 4-5 years, I would not get any refund at all, if one was due.

I have been told also that I would be liable to pay a capital gain tax on sale currently at 19%.

My questions are:-

Should I be paying Renta, and is the 155 euros fees per year reasonable?

Should I have paid the Wealth tax prior to abolition, and do I have a liability to pay unpaid years?

Can I just not pay Renta etc and let it all be sorted through the 3% retention on sale, or is it correct that if I have not been paying it for at least 4 years, I will not get any refund if one was due so should I start accruing my 4 years now perhaps?

Is it advisable that I do have a Spanish will, and is the 150 euros fee reasonable?

In calculating the capital gain on a sale, can you add IVA, solicitor fees and bank fees etc to the cost?

Many thanks,

David Linnell

25.02.11

david.linnell@ic24.net