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Claim for the return of the plusvalia paid

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24 Jan. 2017

Following to regional Court decisions in Madrid, Cataluña, Valencia and Rioja, a resolution of the Málaga administrative Court dated 21st of December has set a precedent in Andalucia for those who have paid the local Tax known as “plusvalí­a municipal” when selling, inheriting or donating real estate properties at a loss.

This is a tax on the increase of the value of the urban land but its calculation does not take into account the real evolution of the value of the land but the current cadastral value and the years elapsed since its previous transmission. Each municipality has to make a general review of the cadastral values every 10 years and many of them made said review it at the peak of the market, with a dramatic increase of values especially in areas such as Estepona, Benalmádena or Marbella. The result is that those selling at a loss or even giving their properties away on bank repossessions had to pay the “plusvalía”, as it happened with the owner of a property in Fuengirola that has won the case. The decision of the Judge is that the Town Hall cannot charge for this tax when there is no gain so he will be able to get his taxes back.

If you have paid this tax on a sale at a loss, on an inheritance or on a donation with a declared value lower than the price paid for the deceased or donor for the property, and you are still within the 4 years statutory limitation period, you may be able to make a claim in Court for the refund.

Going beyond, if you sold a property acquired when the general revision took place (2008 for Estepona, for example), you could be also entitled to make a claim because many of those municipalities have already reduced the cadastral value of the properties, which implicitly confirms that there is no increase of the value of the land, likely even if you made a profit on the sale.

You may be eligible for a tax claim for refund if you sold your house at a loss after January 2013. For further information contact us.  

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