patsywhitehair

hi, recently posted that a bit of land i purchased , the tax man has decided that it was worth more than i bought it for and has sent me a real hefty bill for 5.000 euros. thing is somebody told me if i dont pay the tax people may put an embargo on my house. what is this please....... what would happen

jimenato

I'm surprised no-one's answered this one yet. I'm not an expert but what I think they do is attach a charge to the deeds in some way and you will not be able to sell the house until it is paid - a bit like a car where you can't transfer your car with any unpaid tax or fines against it.

bil

Can't you appeal?

It sounds to me as tho they have figured that there might have been some undeclared money changing hands, and decided to hammer you.

Personally I'd have a word with my lawyer and find out what's going on.

kazic

Patsywhitehair, you should take this issue very seriously. The term "Real Estate" comes from Spanish "Royal Property". In other words, this property does not belong to you but to the Royal - that means Spanish state. They require now 5000 EUR.

You have two choices: to pay 5000 EUR right away and avoid further waste of time,
or
b) to try to achieve some deal and reduce that amount.

Everything else would be a question of techicality and this would not depend on you. The real owner of your property (Spanish state) will decide what is the most appropriate way to confront you. And, in that fight you will lose the shirt...

Englishman's house is NOT his castle because it belongs to Spanish state.

Something similar is also actual in the USA. The name "Real Estate" confirms that the property does not belong to you. There is even one movie "House of Sand and Fog" which illustates how you can lose the house if you do not pay the YEARLY property tax.

JLFS

Although the situation is a tricky one and does need sorting out ASAP, there is no truth in what you say about "real estate" and its meaning.

The term real estate is not Spanish, it is American English so the word "real" cannot mean "royal, as in belonging to the crown or state in Spain.

Real estate just means property nothing, more nothing less.
Not state property, or royal property, just property.

Nobody is disputing the fact that you can lose your home if certain "dues" are not paid, but to base all your assumptions, on what is a "misundersood translation" is a bit too far.

kazic

Sorry, I was thinking that Spanish terms in use in the USA, especially in California are obvious. For example, "Camino Real" is "Royal Road" rather than "Real Road" or "Property Road". "Real" means something that does not belong to you but to the King.

Further explanation of the word "real estate" may be found alse at: http://en.wiktionary.org/wiki/real_estate

Many Englishmen confuse "property" belonging to them in the UK with "real estate" belonging to the state abroad. That is why they get surprisded discovering that they have to pay each year 1% or 1.5% property tax abroad and that they will lose they house if they do not pay that tax. This tax is different than local tax for which someone gets at least some srvices, like garbage collecting.

cricketman

Yes, "Real" does mean Royal, but as JLFS said, Real Estate is an American term and we all know how great Americans are at misusing language

You shouldnt scare people with your posts based on some crazy theory about where the term Real Estate comes from when you clearly dont know anything about Spanish property laws

JLFS

To be honest, for someone who may be in the same situation, and not in a very good position to "defend" their corner, it could have been a very scary and worrying post.

A lot of mistakes and worry can be caused by "translators " doing a bad job, or even misunderstanding between speakers of the same language.

Like the Aussie doctor working in the UK, tell a patient " I am sending you home to die".

DIE was DAY said in an Ausiie accent, but I must have been hairy for the poor patient.

JLFS

"real" and Royal" obviously mean royal, but the days of anything that carried the title or name real/royal meaning belonging to the crown are very outdated.

And in theEnglish speaking US, the word "real" means genuine,not royal.

As in Coca cola "its the REAL thing". real leather, etc.

AFAIK there has never been King of California, Arnie was the nearest thing, so Camino Real, just mean Kings way/road, it it just a name, it could just have easily been called Joe Bloggs Road.

kazic

Dear JLFS, the best way to see who the real owner of your house in Spain (or USA) is, would be to avoid payment of 1% property tax. You will stay without youir home even for the missed minimal payment of let say couple of hunderd euro or dollar.

Someone in this forum even complained that purchasing the house in Spain does not entitle you to live in that house. According to that info, you would need to get a "license to inhabit" that house.

Another people complained that Spanish authorities can simply tear down your house if it does not comply with their regulations.

So, it is simply silly to forget who the REAL owner of your house is.

cricketman

Oh dear me

The state govern the laws of the land in every country on earth, except for those run by warlords or organised crime. The "license to inhabit" the house is to make sure that the house has been built legally and conforms to building standards.

As for property tax, if you dont pay any taxes in any country than the government has the right to claim them back from you which may involve seizure of assets or imprisonment.

As far as the government knocking down your house. This has happened once so far (as far as we know) out of the 22 million houses in Spain and happened because of a corrupt and inept local council i.e. bad governence.

JLFS

People get behind with propetry taxes all the time, and at least here in Spain the state does not dive in head first and take your property from you.

The part about the habitation license, is for when the property is first built, it is to show that it is for living in, not a barn or garage, but a dwelling.

The same thing applies to folks in the UK about properties being demolished if they do not comply with regulations.

You cannot build on your own land in the UK if you have no permission, and if you do it will be torn down.

AND IN MOST CASES THE REAL OWNER OF THE PROPERTIES ARE THE BANKS.

That is one of the contributing factors to the crash, the sub prime market in the USA, and banks left owning nearly worthless propeties.

So where does the stateor crown own them?

twistedmelon

Some years ago it was common practice to sell property/land with black money and to undervalue.
The government got wise to this and now will not automatically accept an owners valuation, a look at the catastro will verify taxable value.
Also if you sell a property to buy another the tax is different than if you buy other additional property/land.
It appears to me that the latter probably applies to you but as bil says a lawyer not a forum would be your only option.

kazic

Home ownership in some limited number of countries is associated with certain privileges: no property tax, no capital gain tax, status of "free man", protection of state intrusion without court order etc...

The residents of such countries face serious trouble when they move to some sunny countries, which are usually without sustainable industry and where the property is regarded as the main source of income for that state.

It is not fair to claim that the rules are everywhere the same and that non payment of tax will put someone in the prison.

I think it would be fair to warn the residents of the country with property privileges that they are going to face completely different situation abroad. The home which is considered an asset in their own country would turn into serious liability in other, sunny country. They should also be aware that they may not get rid of that liability easily... depending on the laws in specific country. In Florida, you may send the key of the house back to the bank. But in Spain or in Dubai, it would not be possible.

For patsywhitehair the house in a sunny country caused a problem and it would be wrong to tell him it is easy and that the authorities are slow in pursuing that money... He is in the system where his house is considered as an important source of income for the sate, and he should do everything to sort out this issue quickly.

cricketman

In some US states where annual property taxes are 2% of the property value then yes, you should be wary.

But annual property taxes in Spain are incredibly low, much lower than the UK council tax for example. I think someone on this forum stated that property taxes for non-residents in Spain are 0.17% of the property value per year. That is hardly a burden or an important income generator for the Government

The taxes that ARE high in Spain are property purchase and transfer taxes at 8% of the property value. For that reason in Spain you should always have the intention of wanting to live in your property for at least 10 years, otherwise you will be constantly forking out 8% of the value of the property in taxes.