Tax windfall for Spanish sellers
IRISH sellers of property in Spain may well be in line for a tax refund windfall following a recent court decision.
The EU commission decided some time ago that the Spanish authorities were not entitled to charge 35pc capital gains tax (CGT) to foreigners while taxing locals at a rate of just 15pc.
The High Court in the region of Valencia has now ruled in favour of a British couple, telling the Spanish tax authorities to repay them having charged a CGT rate of 35pc instead of 15pc.
This is the first time that a legal case has actually been taken and won on this issue.
The opportunity to lodge a tax reclaim hinges on a change to the Spanish tax laws in December 2006, effected following an EU ruling that the discrepancy in rates charged to locals and foreigners was illegal.
The recent judgement sets a legal precedent for thousands of EU citizens to reclaim money owed to them by the Spanish authorities.
According to Spanish law firm Costa, Álvarez & Manglano, if you sold a Spanish property between mid-2004 and December 31, 2006, paying CGT at 35pc, you are essentially entitled to a refund.
But, due to legal time limits, legal experts say submissions should be made quickly to avoid the expiration to an entitlement to a refund.
