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Mallorca - Domizil
our Know-how for your benefit
last update: 1/2008
The Spanish Basic Property Acquisition & Transfer Fees:
(Impuesto de trasmisiones patrimoniales y actos jurídicos documentados).
This tax is payable when purchasing real estate directly from the builder (when purchasing directly from the builder VAT becomes payable). The interest rate is 7% on the value (as declared by the notary office) on the title deed (escritura de compraventa) and is payable at the corresponding Inland Revenue within 30 days of signing of title deed. It is important to ensure that the value at which the real estate is declared is correct as Inland Revenue verifies this value and a possible tax difference could be taken up with the buyer, which could have severe consequences: the taxation of the tax difference for the buyer as additional capital and benefaction for the buyer. Objection against this law has been spoken to the highest court. Until the outcome is however finalised, a tax of 6 % is charged on the non declared discrepancy value as opposed to the fixed real value. Variations of this tax for Certification at a notary office (Actos Jurídicos Documentados =0,5 % of the total cost of the construction project), for declaration of new-construction projects (Declaración de obra nueva) and the so called mortgage tax (1% of the total bond). The yearly property tax (Impuesto sobre los
bienes immueble): This is a different type of tax that is charged for the property by the municipalities. This tax is based on the value entered in land register (about 50-75% of the trafficking value). The interest rate varies between 0.3% and 1.3% but on average is about 0.6%. The tax is paid yearly, usually between September and October. It is advisable, to arrange payment via stop order with your bank. Classification of the territory is a determining factor: Based on the new regulations (part. 9ff.), territory is divided into the following categories: Urban territory:. At least 2/3 of the area must already be developed, include access, energy supply, provision for connections must be in place etc. Territory for urban use Para.11: The lawful regulation is viewed in conjunction with the royal decree no. 5/96 dated 7 June 1996. Further information on urban territory can be taken from the "Plan General Municipal". Non urban territory is generally an area of some kind of protection based on its exceptional value with regard to fauna - agricultural- , forestry - protection or out of agricultural, historical or cultural or ecological equilibrium. Should the particular municipality not have a specific area utility plan, the Act of subdivision into urban and non-urban territory will prevail.

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