Posted: Thu Jan 27, 2022 5:13pm
Hi Darren,
Complementary Tax was introduced because property sellers and buyers in Spain were reducing their tax liabilities by falsely declaring a sale price that was, in some cases, much lower than the price actually paid (with an envelope of cash being passed from buyer to seller "under the table"!). So while it may seem crazy, there is method in their madness. Properties in Spain are supposed to be revalued every 10 years, but in reality it's usually a sale that triggers the revaluation. This means that a lawyer may take a view at the time of purchase about the likelihood of a buyer being charged Complementary Tax. If you don't pay it now, you would have to sit tight for 4 years in the hope that the authorities don't pick up that you paid significantly less for the property than the official valuation. If you were charged retrospectively, there's a possibility that you could appeal the charge - not the tax itself, but the calculation used to arrive at the amount owed. These appeals have to be lodged within 1 month of the tax being levied and are usually successful if the Town Hall has used an out-of-date multiplier. However, that's a lot of "ifs" and €35,000 is a large discrepancy, so it's probably just as well to pay it now.
Kind regards,
Kim