Further measure introduced by Spanish Government to boost property market means its an even better time to buy in Spain!

 

In order to further encourage and continue the evident resurgence in real estate property sales since the introduction of the 50% reduction on new build Government IVA (VAT) from 8% to 4%, the Spanish Government has approved a Royal Decree to be effective from 11th May which provides a reduction of 50% in the Capital Gains Tax on sale proceeds for properties bought between 11th May and 31st December 2012. This is regardless the future sale date.

In a press conference, the Minister of Development, Ana Pastor remarked; “It is going to be implemented an exemption of 50% of revenues arising from the sale of real estate that are acquired from 11th May to 31st December”.

This new reduction is available to individuals, investors and companies, whether tax resident in Spain or not.

The tax remission benefits are subject to the following conditions:

• The property must have been purchased between 11th May and 31st  December 2012
• It must be an urban property (residential or commercial) It must be an urban property (residential or commercial)
• The buyer and seller should not have any connection, either corporate or family
• The property should not be considered a commercial development or venture.

 

The tax reduction will be applied in the annual Income Tax declaration or in the company tax of the fiscal year in which the capital gain was generated.

Provided that the applicant meets all necessary requirements, the capital gain to a non-Spanish tax resident on sale of a Spanish property is taxed as follows:

Sale in 2012-2013           Sale in 2014 or after:

Before: 21 %                    Before: 19%

Now: 10.5 %                     Now: 9.5%

 

The tax on capital gain to a Spanish tax resident is as follows:

Sale in 2012-2013          Sale in 2014 or after

Before: 27%                    Before: 21%

(depending on Gain)

Now: 13.5 %                    Now: 10.5%

 

In the case of companies, the Capital Gain is taxed at approximately 15%.

There really hasn’t been a better time for prospective buyers to take advantage of Spain’s enticement to purchase.

With properties at the Desert Springs Resort, Villaricos Fishing Village and Playa Marques beach development available with up to 50% off List Price, 50% reduction on new build VAT, the best GBP/Euro exchange rate available since November 2008, and now the introduction of 50% reduction on future Capital Gains Tax, it’s a buyers market and a great time to purchase!

For further information contact: The Almanzora Group

Tel: +44 (0) 1242 680 116

Email: tag@almanzora.co.uk