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Buying Property but transfer the funds in UK

Buying Property but transfer the funds in UK

Old Jun 9th 2022, 7:18 am
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Default Buying Property but transfer the funds in UK

Good morning

Does anyone have any first hand experience of buying a property in Spain and making the payment in sterling UK bank to UK bank ? My main question really relates to what the notary will accept as proof of payment ? The only thing that either myself or the seller will have is a bank statement from online banking which obviously wont be stamped or validated in any way. Previously I have made the transaction locally which was obviously straightforward.

Thanks
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Old Jun 9th 2022, 9:22 am
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Default Re: Buying Property but transfer the funds in UK

Originally Posted by UKMS
Good morning

Does anyone have any first hand experience of buying a property in Spain and making the payment in sterling UK bank to UK bank ? My main question really relates to what the notary will accept as proof of payment ? The only thing that either myself or the seller will have is a bank statement from online banking which obviously wont be stamped or validated in any way. Previously I have made the transaction locally which was obviously straightforward.

Thanks
Interesting as I assumed that any Spanish property transaction requires a Spanish bank for the sale proceeds. Normally you need to actually present the notary with a bank transfer which is then notified and passed to the seller. Bank to bank transactions are less common although possible but again I believe they are done on the day of the notary. Not sure foreign bank transactions would satisfy the notary as everything would need to be in Spanish for the notary to approve. Also I cant see where the security is for tax payments as in Spain if it's in a Spanish bank the tax man has authorisation to withhold taxes if it was all in UK they wouldn't have that control
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Old Jun 9th 2022, 9:39 am
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Default Re: Buying Property but transfer the funds in UK

Originally Posted by UKMS
Good morning

Does anyone have any first hand experience of buying a property in Spain and making the payment in sterling UK bank to UK bank ? My main question really relates to what the notary will accept as proof of payment ? The only thing that either myself or the seller will have is a bank statement from online banking which obviously wont be stamped or validated in any way. Previously I have made the transaction locally which was obviously straightforward.

Thanks
Dont think its possible but when we purchased in 2019 I transferred the monies (including the 10% tax ) to the solicitor via wise from £ to €, who then held it until the day of the notary (I was not around so gave POA to the solicitor).
This was paid via a bankers draft from their bank to the seller, this is recorded in the opening paperwork in our deeds. I think there may also be a photocopy of the draft in there as well.

I think the recipient must have a Spanish account these days as there are taxes to pay and there would be no record of the legal transfer of the monies.
Money laundering comes to mind and I think since 2017 cash transactions are no longer allowed at all (although yours would be a transfer but its still cash that no one can trace).


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Old Jun 9th 2022, 11:29 am
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Default Re: Buying Property but transfer the funds in UK

Originally Posted by Barriej
Dont think its possible
I have been advised its definitely possible and not unusual, I just wondered if anyone had first hand experience of doing it.

Originally Posted by Barriej
there would be no record of the legal transfer of the monies.
There is a legal record between two banks in the UK, its just a question as to what the notary accepts as proof.

Originally Posted by Barriej
(although yours would be a transfer but its still cash that no one can trace).
Its not cash that cant be traced its a transfer between 2 banks and the source of the funds can easily be traced. If it was a cash deposit that is then transferred, a money laundering investigation would be triggered in the UK.

Apparantly the foreign currency amount gets converted on the day of the transaction and entered on the escritura in euros. I just wondered if anyone had first hand experience of doing it. I'm waiting on a formal answer from the notary office as to what they accept as proof of the transaction.
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Old Jun 9th 2022, 1:31 pm
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Default Re: Buying Property but transfer the funds in UK

What did your lawyer say? You might be able to transfer funds directly to the lawyer.
I suppose the answer is here https://www.solicitorsinspain.com/ar...property-spain
The funds for the purchase of any property in Spain need not come from a Spanish bank account, although that is certainly the most sensible way to proceed. What is important is that the source of the funds is clear and that the payment of the funds from buyer to seller is apparent from documentation provided. In addition, and perhaps most importantly when you are the owner of a property in Spain you will find that it is very difficult and in some cases impossible to pay for utilities from an overseas bank account, hence it will be important for you to have a Spanish bank account as early as possible.

Last edited by Moses2013; Jun 9th 2022 at 1:33 pm.
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Old Jun 9th 2022, 2:08 pm
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Default Re: Buying Property but transfer the funds in UK

Originally Posted by Moses2013
What did your lawyer say? You might be able to transfer funds directly to the lawyer.
I suppose the answer is here https://www.solicitorsinspain.com/ar...property-spain
The funds for the purchase of any property in Spain need not come from a Spanish bank account, although that is certainly the most sensible way to proceed. What is important is that the source of the funds is clear and that the payment of the funds from buyer to seller is apparent from documentation provided. In addition, and perhaps most importantly when you are the owner of a property in Spain you will find that it is very difficult and in some cases impossible to pay for utilities from an overseas bank account, hence it will be important for you to have a Spanish bank account as early as possible.
Thanks for this ... very useful ........ Unfortunately the lawyer can only do this if its Euros. I have actually just had a reply back from the Notary (shockingly quickly ) via the lawyer to state that if both parties are personally present to confirm they are happy (rather than POA) they will accept a printed bank statement from a recognized bank from both parties showing money out and money in.

We do both already have Spanish accounts (I have a property already). The situation has arisen because we agreed a purchase price in sterling, I have the money sitting in the UK and the seller who is now based in the UK wants the money there, so it seemed pointless me converting it to send out and him converting it immediately to send back unless we really had to.

Thanks all


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Old Jun 9th 2022, 10:17 pm
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Default Re: Buying Property but transfer the funds in UK

I will be interested to hear if you are successful.
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Old Jun 10th 2022, 4:38 am
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Default Re: Buying Property but transfer the funds in UK

Originally Posted by missile
I will be interested to hear if you are successful.
ill be sure to let you know, heading over in about 6 weeks from now to transact it.
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Old Jun 10th 2022, 7:45 am
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Default Re: Buying Property but transfer the funds in UK

When we bought our house, we are British and the sellers were British, we came to an agreement to pay most of the money with a sterling bankers draft, and the necessary amount, including 3% retention as the sellers were not residents, with a Spanish bankers draft. Both cheques were photocopied and included in the escritura. The sterling banker´s draft only cost 12 GBP and so saved us a lot of money on the Spanish banker´s draft.
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Old Jun 10th 2022, 10:21 am
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Default Re: Buying Property but transfer the funds in UK

Originally Posted by stevesainty
When we bought our house, we are British and the sellers were British, we came to an agreement to pay most of the money with a sterling bankers draft, and the necessary amount, including 3% retention as the sellers were not residents, with a Spanish bankers draft. Both cheques were photocopied and included in the escritura. The sterling banker´s draft only cost 12 GBP and so saved us a lot of money on the Spanish banker´s draft.
UK draft is certainly a good option and actually one that removes the need to worry about documenting the payment
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Old Jun 15th 2022, 5:50 pm
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Default Re: Buying Property but transfer the funds in UK

Just to update anyone who is interested.

The solution that we have agreed with all parties (including the notary) similar to that posted above ….. I will handover a sterling bank draft to the seller for the agreed purchase price at the notary, less the 3% tax and less plusvalia. The 3% tax is paid to the notary in euro (apparently preferred that I make a bank transfer up to 15 days after the transaction) and the plusvalia is retained by me to pay whenever the bill arrives.

Last edited by UKMS; Jun 15th 2022 at 5:52 pm.
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Old Jun 16th 2022, 1:59 am
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Default Re: Buying Property but transfer the funds in UK

Thanks for the update :-)
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Old Aug 10th 2022, 8:55 pm
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Default Re: Buying Property but transfer the funds in UK

Originally Posted by UKMS
Just to update anyone who is interested.

The solution that we have agreed with all parties (including the notary) similar to that posted above ….. I will handover a sterling bank draft to the seller for the agreed purchase price at the notary, less the 3% tax and less plusvalia. The 3% tax is paid to the notary in euro (apparently preferred that I make a bank transfer up to 15 days after the transaction) and the plusvalia is retained by me to pay whenever the bill arrives.
For future reference of anyone purchasing and wishing to pay in Sterling. Due to the fact that HSBC no longer issue bank drafts ! We couldn’t get the draft …. We went back to plan A which was as per my original post and question. We transferred the sterling UK bank to UK bank and provided the Notary with the proof of transfer (which was actually a printout from online banking) the seller provided the same for receipt of his funds. Notary was super happy and we now own another apartment and likewise super happy ! .
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