chrisw

Hi all
Sorry if I'm in the wrong place but have just registered and haven't learnt how to navigate the site yet. My husband and I will be moving to Spain as soon as the house is sold, but are becoming increasingly concerned at the horror stories we are hearing about land grab tax. My understanding (and please correct me if I'm wrong) is that in one province only in Spain they have incorporated a land grab tax. Otherwise disguised as an urbanization charge. Whereby at any time up to about 4 or 5 years after purchasing NEW property or some property on the outskirts of villages, the Spanish Government are charging huge amounts of tax, almost to the value of the original house purchase price. That being the case, people are losing their house and all they have paid for it. Can anyone please enlighten me in relation to this and what province is affected by it? I have received a phone call from relatives in the States today advising that a developer has just lost $100,000,000 and which has affected 16 other people. I would be very gratefull for any light shed on the subject. Many thanks. :

Mitzyboy

Think you are referring to the Great Valencian Land Grab. Not actually a tax, but originally a law created to promote affordable housing for the Spanish and turned on its head by greedy property developers.
In effect people have had their villas or part of their land compulsorarily purchased for peanuts and then charged sevice charges for new roads etc that have been built on their land.
The EC have tried to outlaw it. I may not have described it that well, but this article may help
http://www.practicalspain.com/valencian-land-grab.htm

Use a good solicitor!

tim hortons man

Before buying anything I'd suggest spending 10 quid and buying the latest edition of "Spain the Law and You" and read the chapter on buy property, it is very very different from anything I've encountered.

Reading some of the stories of how brits buy (or bought during the boom years) property in Spain, flying down for a whirlwind cash under the table weekend, its no wonder people latter ran into problems.

BTW is it still common to pay part under the price cash under the table? And anyone got stuck paying tax on the previous owners capital gains?

Mitzyboy

Yes I believe it is Tim, although less common than it was

mikelincs

I suspect it depends on how you buy, we bought via a property company, and bought a resale, no money under the counter at all. I thnk if you use a decent abogado, and are not buying a property with a lot of land, you should be OK.

chrisw

Thanks for the info to Mitzyboy and Tim Horton's Man. I have read the article you recommended which give details on contacts who are dealing with this matter in official capacity to try and get this injustice over-riden by a new Spanish NATIONAL law which, they argue, SHOULD overide any local laws, BUT advise that this has not yet been tested through the Spanish Courts. I will keep my eyes peeled for any further input in relation to this matter. Once again, thanks for your input.