The changes in the tax to be paid on property transfers, (purchases and sales) and the Inheritance tax, have entered into force as of January 1, 2022.
Here we try to explain what the changes consist of, and how this new taxation will affect this type of transaction, hoping that it will clarify for our clients and friends.
What changes have occurred?
Until the beginning of 2022, the property transfer tax and the inheritance tax were calculated based on the sale price of the property and the percentage that each autonomous community assigned for it. At that time, you had to warn your clients that in the following 4 years they could receive a revalidation of that tax, where the Treasury could demand an increase in the initial tax figure. Calculated using the figure resulting from the difference between the appraisal and the sale price. This revalidation occurred when the appraisal price was higher than the sale price and as a measure to tax what could be money laundering or tax fraud.
From January 1, 2022, a new figure came into force from which to calculate the property transfer tax and inheritance tax. This new figure is determined by the Treasury based on the market value of the property, which is not the same as the cadastral value.
The main difference between the two is that the cadastre reference is calculated from the prices of real estate transactions before a notary. While the cadastral value is based on the specific characteristics of each property.
This new figure will be updated each year for each property, based on the average sale price of properties in that area, which does not necessarily coincide with a neighborhood or district.
How does this change affect?
This value will be the new minimum for which to pay taxes. It will only apply to properties whose sale price is less than the reference value.
Therefore, the purchase of a home whose sale value is less than the new reference value will pay more taxes than if this operation had been carried out before the change.
The only advantage that it can represent for the buyer is to avoid the uncertainty of this complementary tax or to reduce the amount to be paid when the cadastral value is less than the reference value. This new value does not take into account the state of conservation of the property, if it has undergone any reform or the materials that form it.
This change is expected to negatively affect taxpayers, since it is usual to buy real estate below its market price.
For example, for a second-hand property whose sale price is €150,000 and a reference value of €185,000, the taxpayer will have to pay taxes on an additional €35,000. This rise is expected to even affect rents, since the houses purchased for this investment purpose will pass on this higher tax expense to their tenants.
How to calculate the reference value.
To access the reference value of the property you want to acquire, so that from the first moment you have the real figure of the taxes you will have to pay. You will have to access the following link: https://www.sedecatastro.gob.es/, once inside you must enter the "reference value" section located in the upper right. Then you must click on "reference value query" and enter your ID and support number, if you do not have a digital certificate or key.
With that value you must calculate the transmission tax, based on the percentage of your community.
And this data already provides exactly the taxes to be paid in this type of transaction.