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Thread: Dissolution of Joint Property Ownership in Spain

  1. #1
    Jackie
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    Default Dissolution of Joint Property Ownership in Spain

    This is the discussion thread for the article Dissolution of Joint Property Ownership in Spain

    --

    Hi, I'm divorcing my husband and are in the process of transfering the property into my sole name. My solicitor says I have to pay 7% transfer tax. Is this true? Your article says it's only 1%.

  2. #2
    Junior Member
    Join Date
    Oct 2008
    Posts
    5

    Default

    Hello Jackie

    The subject is rather complex, and further information is needed before an answer can be provided.

    To simplify things, we will assume that you are non resident, and are transfering just one property (indivisible).

    • Generally speaking, 1% Stamp Duty is applicable if there's payment in money in exchange of the share that is being transferred (after deducting the corresponding part of the mortgage).
    • If no payment is made at all, the transfer will be considered by the taxman as a donation, and taxed accordingly (not recommendable!)
    • There are some circumstances in which 7% transfer tax is applicable, specifically in cases in which payment is done in kind (e.g. a car, furniture, etc), instead of money.

    In any case, I recommend that you submit your question to a Tax Advisor experienced in Spanish Tax Law.

  3. #3
    Sandra
    Guest

    Default Dissolution of Joint Property Ownership in Spain

    ey!!!

    Que cambio de imagen!muy bonito.
    Congrats!

  4. #4
    liz
    Guest

    Default Dissolution of Joint Property Ownership in Spain

    We are non-resident and I bought a property in Spain with money I had from the sale of a house I owned alone in England. However, we bought the Spanish house in my and my husband's names thinking it was like the UK. Then my husband was seriously ill and as I am also younger we have considered putting the house in just my name so that our adult children won't be liable for IHT that they can't afford should only one of us die (I appreciate I could go under a bus but we were looking at most likely outcome!). Obviously would not plan to "pay" my husband. So is it 1% or 7%? I can show the money was originally mine in the UK, does this help?

  5. #5
    Senior Member
    Join Date
    Oct 2008
    Location
    Marbella
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    1,095

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    Dear Madam,

    It would be 1% Stamp Duty as it would be clearly a Dissolution of Joint Property Ownership.

    If you want an example study case with breakdown of legal fees, expenses and taxes involved contact us free of compromise to request it.

    Regards,

    Raymundo Larraํn Nesbitt
    Last edited by Lawbird Lawyer; 01-27-2009 at 12:13 PM.

  6. #6
    batty
    Guest

    Default Dissolution of Joint Property Ownership in Spain

    Hi I have to comment on your postive responses as i have been struggling and getting responses from other that i have to pay all the ridiculus charges discussed above. my situation is that i have purchased a home in spain and have part of the mortgae outstanding (140e) and my husband and my names are both on the deed and mortgage. i have paid all expenses including the mortage for the last 2and half years as my husband has no work and also got himself into bad debt trying to venture to set up his own company. the problem now is thatmy current bank is refusing to change my mortage it is around 1000 euros for 140k loan and repayment one. refusing to give me interest only. hard to sell property unless i sell it at a loss. i have already invested a 100 euros in it. i also belive it may not be valued at what i bought it for. I have manged to find an english lender with a great mortgage deal on interest only but as my husbands name is on it they want give it to me untill i remove his name. due to his credit history being poor. to take his name off sounds like an expensive exercise and again more expenses for me.he is very willing to give up his name /rights and not looking for anything as the proeprty was bought by me for our little girl as an investment from my savings anyway. i have said this to the bankbut they want have it. switching bank is going to cost me money and will also have to pay my bank for giving up the mortgage . so i am in catch 22 situation . surely there must be an easy way of taking a name of .Spainish law seems to want taxes for everything sorry to say this. i have already paid and not made a penny . help please. thanks

  7. #7
    Senior Member
    Join Date
    Oct 2008
    Location
    Marbella
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    Dear Madam,

    To take your name off the deed Transfer tax and associated expenses have to be paid. This is just not simply having your name removed from it.

  8. #8
    john evans
    Guest

    Default Dissolution of Joint Property Ownership in Spain

    Bought a house in spain in joint names with my wife in 1983. We divorced in england 1989 with clean break settllement with my wife giving up her share in the house in Spain. The house is still registard in both names. I wish to sell the property and my ex agrees to give me power of attorney to sell her half. If I should die before this happens I can see all sorts of problems arising.
    I was told years ago by a spanish abogado that there was no need to change anything as since Spain joined the EEC English divorce papers were reconised. The agent tells me I need to change it officialy, but my concern with that is, will I lose the benifits of nil capital gains tax as it was bought before 1986 and not having to leave 3% holding fee. Also would there be charges, by changing it into my name only via the divorce papers other than legal fees?

  9. #9
    buddy
    Guest

    Default Dissolution of Joint Property Ownership in Spain

    My mother bought an apartment in spain with her partner 7 years ago, he died 5 years ago. In his will he left his share to her, but nothing has been done officially to change the ownership. She may need to sell the apartment in the next two years. Should she change the deeds/ownership to her name before she sells, and if so how much tax would she have to pay? Or should she wait until she sells? what tax would she be liable for then?

    Thank you for yur help in this

  10. #10
    Senior Member
    Join Date
    Oct 2008
    Location
    Marbella
    Posts
    1,095

    Default

    Dear Sir,

    Your mother cannot sell what's not hers.

    She first has to lodge the 50% bequeathed by her partner under her name at the land registry prior to selling on the property.

    No Spanish Notary will allow the sale of a property whose not under the name of the vendor, it's a criminal offence ruled by art 251 of Spain's Criminal Code.

    Your mother would have to hire a Spanish lawyer and do as follows:

    1.- Depending on the nationality of her partner, a grant of probate.
    2.- Deed of Declaration of Heirs by which she's appointed as the sole beneficiary of the remainding 50%.
    3.- Lodge this deed at the land registry and pay any associated taxes such as Death duties. As 5 years haver already gobe by she will not have to pay Spanish Inheritance Tax albeit her lawyer will still have to fill in the tax model otherwise the property will not be registered under her name.
    4.- Once the proeprty is fully under her name she's free to do with it as she pleases.

    I take the opportunity to offer her our legal service on Estate Transfer to Heirs:

    Estate Transfer to Heirs

    This service is intended for those who are inheriting the Spanish assets of a deceased person, whether as the legal heir to an estate or by means of a will
    The Estate transfer to heirs service includes

    • Requesting of copies of the Death Certificate, in the event that the death took place in Spain.
    • Requesting of a Will Certificate information and location from the Central Registry of Wills in Madrid.
    • Obtaining of the Will from the Notary Public where it was signed / Estate Heirs Statement (in those cases where there is no will)
    • Inheritance Acceptance
    • Partition of the inheritance according to what the will states, or, where there is now will, to the desires of the inheritors .
    • Inscription at the Land Registry of the new owners of the Estate inherited.
    • Arrangement of payment of the applicable Inheritance Tax.

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