Expat Forum For People Moving Overseas And Living Abroad banner

1 - 14 of 14 Posts

·
Registered
Joined
·
18 Posts
Discussion Starter #1
Hi everyone,

I wonder if anyone else has had the same problem as me.

I bought a house in Barcelona in 2016. Before the formal papers were signed Okupas (Squatters) got into the house and although the bank managed to get them out, they had stripped the whole house. Only the bare walls were left standing.

The bank agreed on a price of €44.000 and we paid the 10% tax to the Catalan Government.

Three years later my bank account got an embargo. I eventually found out that the Agencia Tributaria de Catalunya had decided I bought the house for too little money and had increased the value to €89.650? This meant we owed them another €5000.

I had never been notified of this. Apparently, they sent three letters, all to the wrong address, and had put a notification on a bulletin board in an office 27km from where we live in 2018.

I've tried fighting it constantly. As I earn less than the minimum wage of €900. But they just ignore me and say it has to be paid with 20% commission added and a daily interest fee.

Can anyone help or give me advice on this. It's so stressful to me and my husband who is ill with Graves' Disease (an autoimmune disorder)

Siobhan:eek:
 

·
Registered
Joined
·
186 Posts
Hi everyone,

I wonder if anyone else has had the same problem as me.

I bought a house in Barcelona in 2016. Before the formal papers were signed Okupas (Squatters) got into the house and although the bank managed to get them out, they had stripped the whole house. Only the bare walls were left standing.

The bank agreed on a price of €44.000 and we paid the 10% tax to the Catalan Government.

Three years later my bank account got an embargo. I eventually found out that the Agencia Tributaria de Catalunya had decided I bought the house for too little money and had increased the value to €89.650? This meant we owed them another €5000.

I had never been notified of this. Apparently, they sent three letters, all to the wrong address, and had put a notification on a bulletin board in an office 27km from where we live in 2018.

I've tried fighting it constantly. As I earn less than the minimum wage of €900. But they just ignore me and say it has to be paid with 20% commission added and a daily interest fee.

Can anyone help or give me advice on this. It's so stressful to me and my husband who is ill with Graves' Disease (an autoimmune disorder)

Siobhan:eek:
Same thing happened to me. I bought our place in 2011. When I bought it, we paid the ITP to the Principality. About a year later, we received a letter saying we paid around 100,000 Euros to little for the place. As a result, we owed almost 10,000 Euros. I went to our gestora and she protested the taxes for us and won. My advice-Get a gestora. There are a lot of properties on the books for way over market value. I think you bought one of them.
 

·
Registered
Joined
·
18 Posts
Discussion Starter #3
Same thing happened to me. I bought our place in 2011. When I bought it, we paid the ITP to the Principality. About a year later, we received a letter saying we paid around 100,000 Euros to little for the place. As a result, we owed almost 10,000 Euros. I went to our gestora and she protested the taxes for us and won. My advice-Get a gestora. There are a lot of properties on the books for way over market value. I think you bought one of them.
So, did you have to pay the €10.000? Is there nothing we can do? This seems like a total con to me.

Thank you for your reply.

Siobhan
 

·
Registered
Joined
·
645 Posts
It might seem like a con but basically it's designed to prevent sellers and buyer conspiring to under value a property and make up the difference with cash under the table thus cheating the government out of tax which would be due.

Estate agents, and probably banks, won't tell you about the risks nor will your solicitor if you chose to go with one recommended by them which is why you should always engage your own.

Remember too that this something any Spanish national will know about so it's nothing secret or underhand and unfortunately what's being demanded will have to be paid.

It's common for this to only come to light 2 or 3 years after the sale and that's because the Hacienda can only go back 4 years and they are know to go through both property transactions (and tax returns) when that 4 years is approaching so that they don't miss out!

A lot of folk have a similar surprise coming their way but don't know it yet!

BTW I have Graves Disease, it's incurable as you probably know. The treatment for me was Thyroid removed. That was about 4 years ago and I can say that with fairly minimal medication my life is back to as it was before.
 

·
Registered
Joined
·
18 Posts
Discussion Starter #5
Thank you for your email and I am so glad that your life is better since your operation.

I don't understand though why the Notary and the Bank are not responsible for highlighting this extra tax that will be demanded?

Okay, it is not right that people pay cash for a property to avoid tax. But if you buy the house directly from the bank, with a mortgage. Then there's nothing in the black.

It's the fact they didn't notify me, that gets me. If they have a valuation for the house, how come they sent the notifications to three different addresses? Then put a notice on a board in another town. It's almost as if they deliberately did not inform us, so that they could then add 20% plus interest.

Anyway, with these institutions you never win.

Take care.

Siobhan
 

·
Registered
Joined
·
18 Posts
Discussion Starter #6
Same thing happened to me. I bought our place in 2011. When I bought it, we paid the ITP to the Principality. About a year later, we received a letter saying we paid around 100,000 Euros to little for the place. As a result, we owed almost 10,000 Euros. I went to our gestora and she protested the taxes for us and won. My advice-Get a gestora. There are a lot of properties on the books for way over market value. I think you bought one of them.

So, your Gestoria won the case for you. That's interesting. I might look into that. Thanks for the advice.
 

·
Registered
U.K.
Joined
·
8,756 Posts
This happened to us... Our lawyer responded to the claim. We ended up paying nothing. Apart from the lawyer !
 

·
Registered
Joined
·
18 Posts
Discussion Starter #8
This happened to us... Our lawyer responded to the claim. We ended up paying nothing. Apart from the lawyer !
That's interesting to know. I think I'll contact him. Because we paid almost €12.000 in fees for a house of €44.000?

Thank you I'll try that.

Siobhan
 

·
Registered
Joined
·
5,811 Posts
Happened to us too. We bought a bank repossession in the 1990s. Received notification about 6 months later. Spoke with Lawyer and he said it was rare for anyone to overturn their decision. Decided to pay up although thought it was very unfair as we did declare full price and bought from a reputable bank.
 

·
Registered
Joined
·
18 Posts
Discussion Starter #10
Hmm, That's the sort of response that I am getting from lawyers. Pay up and shut up. But someone needs to make a stand against this. It's just not right. I wrote to the Gestoria who originally dealt with the mortgage and she wrote back "I have contacted the tax office and they should respond to you shortly..." Eh, hello, it's the tax office that's demanding the money. Aggggh!
Thank you for your email.
Siobhan
 

·
Registered
Joined
·
381 Posts
That's interesting to know. I think I'll contact him. Because we paid almost €12.000 in fees for a house of €44.000?

Thank you I'll try that.

Siobhan
Wow thats a lot of fees, I feel for you.
I suppose because you paid for a bank repossession they wouldn't let you use your own legal team?

I if so thats why a Bank repo seems a cheap way to buy a property until you get into the fee's, mainly because the Bank just want to clear their debt, the selling price does not match the value.
And if thats the case, they are NEVER going to tell you the truth, why would they, it gets another money pit off their hands.

Usually legal fees for buying (less the normal 10% tax) is around 1% of the purchase price or a set sum, which ever is the greatest. We paid €1,000 including the cost of the POA top the solicitor because I couldn't get here to sign the paperwork.

When we purchased the flat in 2019 the Solicitor was quite open about the difference we paid against the Cadastral value. We paid €78.000 and the property was still at its initial value of €92.000 (that was its original selling price in 2005). We were told that if and when they ask for the money its easier to pay than to appeal as the costs in our case would be more than the extra tax.
 

·
Registered
Joined
·
18 Posts
Discussion Starter #12
Wow thats a lot of fees, I feel for you.
I suppose because you paid for a bank repossession they wouldn't let you use your own legal team?

I if so thats why a Bank repo seems a cheap way to buy a property until you get into the fee's, mainly because the Bank just want to clear their debt, the selling price does not match the value.
And if thats the case, they are NEVER going to tell you the truth, why would they, it gets another money pit off their hands.

Usually legal fees for buying (less the normal 10% tax) is around 1% of the purchase price or a set sum, which ever is the greatest. We paid €1,000 including the cost of the POA top the solicitor because I couldn't get here to sign the paperwork.

When we purchased the flat in 2019 the Solicitor was quite open about the difference we paid against the Cadastral value. We paid €78.000 and the property was still at its initial value of €92.000 (that was its original selling price in 2005). We were told that if and when they ask for the money its easier to pay than to appeal as the costs in our case would be more than the extra tax.
Thank you for your reply.

Everyone seems to be getting told the same thing. Just pay the fees.

If we could get a lot of people together who have suffered the same fate. We could maybe start a class action and that way we could take them to court and help other poor souls in the future from suffering like we have.

Siobhan
 

·
Registered
Joined
·
381 Posts
Thank you for your reply.

Everyone seems to be getting told the same thing. Just pay the fees.

If we could get a lot of people together who have suffered the same fate. We could maybe start a class action and that way we could take them to court and help other poor souls in the future from suffering like we have.

Siobhan
While I agree its not a nice situation to be in. Its not something thats hidden away and is illegal, it might seem unjust or even offend morally but the original reason for making such a rule, was to prevent the paper bag scenario.

I doubt any of would still be living by the time any such action got anywhere near the Spanish courts.

Unfortunately everywhere in the world there are such rules and while you expect your paid for legal representation should inform you, most don't, or wont unless you raise the issue with them.

There are people who come here and are surprised that there is a purchase tax in Spain and your house in the sun will be at least 10% dearer than what the agent told you.

What there needs to be is a warts and all information platform that can guide would be purchasers, not something an amateur could maintain and I doubt any professional would unless there were something in it for them.

As is said here multiple times. Ignorance is no defence.
Im sorry but I don't think there is much to be gained.
 

·
Registered
Joined
·
18 Posts
Discussion Starter #14
While I agree its not a nice situation to be in. Its not something thats hidden away and is illegal, it might seem unjust or even offend morally but the original reason for making such a rule, was to prevent the paper bag scenario.

I doubt any of would still be living by the time any such action got anywhere near the Spanish courts.

Unfortunately everywhere in the world there are such rules and while you expect your paid for legal representation should inform you, most don't, or wont unless you raise the issue with them.

There are people who come here and are surprised that there is a purchase tax in Spain and your house in the sun will be at least 10% dearer than what the agent told you.

What there needs to be is a warts and all information platform that can guide would be purchasers, not something an amateur could maintain and I doubt any professional would unless there were something in it for them.

As is said here multiple times. Ignorance is no defence.
Im sorry but I don't think there is much to be gained.
Don't be so negative about it. If everyone just went along with everything they were told was the "norm" then no one would ever change anything. We are not idiots and my husband has lived in Spain for many years. Although a different part of Spain. He had a business in Spain too. However, our attention should have been drawn to the additional funds at the time of signing the escritura. Either by the Notary, Gestoria, or the Bank. I understand the 'open suitcase full of money purchase' (in the black). But we are talking about a supposedly reputable bank. I mean we pay all these fees and is any one of them actually looking out for us?
Thank you for your response.
Siobhan
 
1 - 14 of 14 Posts
Top