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selling in spain

selling in spain

Old May 29th 2009, 9:16 am
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Default selling in spain

Hi All,
this thread may already be on here somewhere
so sorry for not doing a proper search..
we are hoping to sell our property in spain
the contract we have signed states we are selling for 150,000euros
but at notary we are declaring 110,000euros
first question..do we need a solicitor, or can we do everything on our own
second question...is their any chance of them after signing at notary, refusing to pay the 40,000 difference
where would we stand if they refused
all comments welcome
thanking you all in advance
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Old May 29th 2009, 9:22 am
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Default Re: selling in spain

Originally Posted by lcr04 View Post
Hi All,
this thread may already be on here somewhere
so sorry for not doing a proper search..
we are hoping to sell our property in spain
the contract we have signed states we are selling for 150,000euros
but at notary we are declaring 110,000euros
first question..do we need a solicitor, or can we do everything on our own
second question...is their any chance of them after signing at notary, refusing to pay the 40,000 difference
where would we stand if they refused
all comments welcome
thanking you all in advance
they should pay you the "black" money at the notary....thats what happened when we have bought/sold in Spain before

and the contract you have signed to say you are selling for 150,000 should be legally binding
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Old May 29th 2009, 10:37 am
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Default Re: selling in spain

And if they find out that you have underdeclared, the extra 40k will be taxed as a gift - plus a large fine!
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Old May 29th 2009, 10:39 am
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Default Re: selling in spain

Originally Posted by Fred James View Post
And if they find out that you have underdeclared, the extra 40k will be taxed as a gift - plus a large fine!
but everyone still does it no ?
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Old May 29th 2009, 11:17 am
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Default Re: selling in spain

Originally Posted by spain View Post
but everyone still does it no ?
I do know that this happens quite openly and is accepted as the norm here. I have had personal experience whilst purchasing a property but opted out of the sale not wanting to get involved, just in case of the consequences.
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Old May 29th 2009, 11:18 am
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Default Re: selling in spain

Originally Posted by spain View Post
they should pay you the "black" money at the notary....thats what happened when we have bought/sold in Spain before

and the contract you have signed to say you are selling for 150,000 should be legally binding
The dangerous thing is that the contract that both parties sign at the notaires will specify 110 and nor 150!!!!

So, my advice would be to get the 40k BEFORE signing the contract.

Yes it's illegal, yes everyone does it, and yes you will be in deep doo-doo if the tax man finds out.
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Old May 29th 2009, 11:43 am
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Default Re: selling in spain

Originally Posted by lcr04 View Post
Hi All,
this thread may already be on here somewhere
so sorry for not doing a proper search..
we are hoping to sell our property in spain
the contract we have signed states we are selling for 150,000euros
but at notary we are declaring 110,000euros
first question..do we need a solicitor, or can we do everything on our own
second question...is their any chance of them after signing at notary, refusing to pay the 40,000 difference
where would we stand if they refused
all comments welcome
thanking you all in advance
Would you sell your house if you lived in the UK without using a solicitor?
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Old May 29th 2009, 11:46 am
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Default Re: selling in spain

Originally Posted by lcr04 View Post
first question..do we need a solicitor, or can we do everything on our own
we have done it both ways....but I would always recommened using a solcitor
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Old May 29th 2009, 12:00 pm
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Default Re: selling in spain

Originally Posted by Mitzyboy View Post
Would you sell your house if you lived in the UK without using a solicitor?
If Notaries were used in the UK in the same way that they are in Spain I wonder if people would bother to use solicitors?

I used a solicitor for every house I purchased in the UK, and I have never used a solicitor here in Spain (my OH strictly prohibits it).
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Old May 29th 2009, 12:05 pm
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Default Re: selling in spain

Originally Posted by spain View Post
but everyone still does it no ?
Everyone certainly used to do so but times have changed over the last few years.

There is a very large program to stamp out tax fraud in Spain which has been in existence for the last couple of years. One area that is receiving a lot of attention is property sales. The notaries and registrars are all using computer systems which can highlight any potential under declarations and also more information about the source of the money is required.

They also have access to the bank accounts of the buyers and sellers and can easily check where the money came from.

Any under declaration of more than 20% is likely to present problems which may only come to the surface some time after the sale. You also have to be very careful what you do with the 40k in cash as it will be very difficult to launder it and to exchange it for Sterling will be an even bigger problem.
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Old May 29th 2009, 12:17 pm
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Default Re: selling in spain

I have to echo what Fred says, it USED to be the norm, but is certainly not the case anymore, it's actually quite frowned upon now by all parties generally.
I know I would not go down that road anymore, once yes, but not now, very very risky.
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Old May 29th 2009, 12:26 pm
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Default Re: selling in spain

Originally Posted by snikpoh View Post
The dangerous thing is that the contract that both parties sign at the notaires will specify 110 and nor 150!!!!

So, my advice would be to get the 40k BEFORE signing the contract.
Yes, this is something I've wondered about from time to time. If your buyer signed the sale agreement and then just says "cheerio, thanks for the house" presumably you have no legal remedies open to you. Likewise, if the buyer slips you a wad 'o cash beforehand, there's nothing to stop you trousering it and then not going ahead with the purchase. Or even a spanish version of "gazundering" where the buyer says "I know we agreed on 40k cash, but I can only raise 20k - take it or leave it"
I think if I heard of either of these situations (I'm sure they must happen) I wouldn't have any sympathy for the aggrieved party. It may sound mean, but I'd probably just laugh

Last edited by pete_l; May 29th 2009 at 12:29 pm.
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Old May 29th 2009, 5:29 pm
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Default Re: selling in spain

I don´t want to get into the argument should you or shouldn´t you but agree with Fred regarding no more than 20% being paid in the black.

I can tell you from experience that we recently have started to get clients coming into the office for help having been found out by the taxman for under declaring!!
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