From Welex, your expert lawyer in real estate law in Spain, we want to share a brief summary about the municipal Plusvalia Tax in Spain.
Since we know that sometimes it can be a little confusing, here are some issues related to that tax:
Who is in charge of the management and collection of the Plusvalia Tax?
The city council is responsible for this tax, which means that Plusvalia Tax in Spain is a city tax.
What is the law governing Plusvalia Tax in Spain?
This tax is regulated by the Spanish Law on Local Finances.
In Article 104 we find it defined as a direct tax levied on the increase in the value experienced by urban land.
Thus, we can say that land of a rustic nature is not subject to this tax in Spain.
What are the deadlines for filing the Plusvalia Tax in Spain?
In the event of death, the period of presentation of the capital gain in Spain is 6 months.
Normally these 6 months are exhausted without even having accepted the inheritance, so the law provides for the possibility of extending that period another 6 months up to one year.
There are cases of exemptions in the payment of this capital gains tax in which we will not stop at this ticket.
The opinion of Welex, lawyers specialized in real estate law in Spain
From Welex’s point of view, the plusvalia in Spain is an unfair tax far from the fiscal principles of generality, progress and equitable distribution of the tax burden.
Constitutional Court ruling on Plusvalia Tax.
In the judgment of 11 May 2017, the Constitutional Court declared the partial invalidity of certain articles of the mentioned Local Finance Regulatory Law, except in cases where there is no increase in value.
The point is that such cases where there is no increase in value were not resolved.
To find more detailed information, as well as a practical case of capital gains in Spain; Welex, experts in real estate law in Spain, invites you to read this publication.
Do not hesitate to contact us to resolve any questions related with real estate law in Spain.