Tax Demands sent by the Valencia Tax Authority likely Illegal

  • Jose Antonio
    Jose Antonio is a highly-experienced lawyer in the Alicante area of Spain. With offices in the centre of Alicante Capital, Jose-Antonio has offered expert legal advice for more than 10 years to English-speakers involved in Property transactions and contractual disputes as well as family law, inheritance and business formation.

Many property purchasers (and also beneficiaries under Wills or those who have been gifted property) in the Valencia Region have received in the last few months, a “supplementary tax demand” for the stamp duty (Impuesto de Transmisiones Patrimoniales) or the inheritance and gift tax (Impuesto sobre Sucesiones y Donaciones).

This tax demand has been issued by the tax authority in the Valencia Region (Conselleria de Hacienda): they have been considering and reviewing the valuations of acquired, inherited or gifted properties, and have arrived at a higher value than the actual price referred to in the Notary deeds. As a consequence of this new valuation, the Tax Authority calculates the amount of tax to be paid, which is higher than the amount previously paid; and they claim for the difference –plus interests- against the new owner.

The referred to valuation adjustments that the Tax Authority has been making were carried-out under the authority conferred by article 57.1.b) of the “Ley General Tributaria” legislation and the Regulation: ORDEN 23/2013, issued by the  Tax Authority. Those legal texts refer to the right of the Administration to review valuations just by referring to the valuations (a certain price per square metre) previously published in official registries for tax purposes, applicable to all the properties in a determined area. 

But legal circumstances have recently changed in regard to these issues as a consequence of the Judgment issued on the 28th of October 2015 by the Supreme Court in Valencian Region  – the Tribunal Superior de Justicia de la Comunidad Valenciana (TSJCV)-. This Court has determined that the direct reference to “official prices” is acceptable in certain cases -for example, local taxes known as “IBI” or “Plusvalía”-, but not for other taxes, like stamp duty (Impuesto de Transmisiones Patrimoniales) or inheritance and gift taxes (Impuesto sobre Sucesiones y Donaciones). According to the Supreme Court Judgment, the Laws applicable to these taxes require the valuation adjustments made by the tax authority to be personalised and individualized. Accordingly, any valuation reviews that were carried-out making reference only to the “official prices” were deemed to be against the Law and, therefore, invalid.

This new situation opens the door for appeals by hundreds of property purchasers (or indeed beneficiaries under Wills, or those receiving a gift of property in the Valencia region) who have received notifications of tax demands relating to the these taxes. Therefore, we highly recommend to appeal against those tax demands. If the  Tax Authority refuses a first appeal, we will have the opportunity to appeal again, through an “administrative” Court called the Tribunal Económico-Administrativo and, if necessary, through the mentioned Supreme Court, which is the highest judicial authority in the region and has already clearly determined this issue.

Client Testimonials

Below is a list of recent reviews received from our clients, obtained via Wufoo client survey platform:

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    Pernilla, London
    Friday, April 13, 2018
    We had excellent service from Esther at Advocate Abroad when buying a property in Las Palmas, Gran Canaria.

    Esther speaks both Spanish and English, and is very friendly, professional and genuine. ...She took care of the whole purchasing process and explained all the steps for us, including giving advice on Spanish bank account, NIE numbers etc.

    We are very pleased with all the help we have received and can highly recommend Esther. Thank you so much!
  • Default Avatar75
    David Pratt, Alhaurin del Grande
    Friday, April 13, 2018
    Alvaro gives me confidence that he understands the issue and gives me practical solutions. He works rapidly and efficiently. I would strongly recommend his services.
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    ESP, London
    Wednesday, March 28, 2018
    Cristina was extremely helpful, she couldn't have done more. Her English is sufficient and I would definitely recommend her to friend.
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    L Marshall, London
    Wednesday, March 28, 2018
    Rosa was excellent. Very efficient and professional.

    Responsive and always available. Extremely helpful - we did not understand the process and she guided us through.

    We would not hesitate to ...recommend her.
  • Default Avatar75
    Phil Loughton, Las Lagunas de Mijas
    Tuesday, March 20, 2018
    Alvaro was extremely helpful and the simple process I needed managed was dealt with quickly and efficiently. I would certainly recommend him to friends.
  • Default Avatar75
    John Burchell, Arroyo De la Miel
    Tuesday, March 20, 2018
    Alvaro was very professional, helpful and friendly. Understood things quickly. Explained things well in English. Very easy to contact at any time.
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    A. Kavanagh, Glasgow
    Thursday, March 15, 2018
    Miguel provided a great service and fully explained to me about the procedures with tax & business registration. My emails and questions where always answered straight away with an immediate response ...or solution.

    Very helpful and very friendly I would definitely recommend to anyone considering using Advocate Abroad
  • Default Avatar75
    Robert Davies, Mallorca
    Monday, March 12, 2018
    Very supportive and clear on producing a suitable divorce settlement. Efficient, understanding and professional.
  • Default Avatar75
    A.Kavanagh, Glasgow
    Friday, March 09, 2018
    Rosa was exceptional at helping me setting up my business abroad.

    This was a big move for me and Rosa fully explained everything to me in detail so I had a full and clear understanding of the lega...l side of things as well as always promptly responding to any emails or questions I had.

    I couldn’t of asked for a better lawyer and I would 100% recommend Rosa to anyone who is deciding to move abroad.

    Great service could not be happier.
  • Default Avatar75
    Adam Clark, Tenerife
    Friday, March 09, 2018
    Oliver was very professional. He explained things very clearly and honestly at all times and in the end we got the best result possible in my particular case.

    Many thanks to him for his high level ...of service.
  • Default Avatar75
    Patrick Martel, Canada
    Wednesday, March 07, 2018
    For being in another country and all our back and forth communicating over emails .. I thought Rosa did a brilliant job. Thankfully she was able to help where no one else was willing ..
  • Default Avatar75
    Robert Scott, UK
    Wednesday, March 07, 2018
    First class service. Rosa's professionalism, advice and patience were all exemplary! Keep up the good work. Will certainly recommend the service to friends!
  • Default Avatar75
    Martina, Plymouth
    Monday, March 05, 2018
    Erardo was fantastic and helped immensely during a very difficult situation.

    He consulted with my lawyer in the UK and explained to her what needed done. Without him the situation would not have be...en resolved. He was very understanding and I would have no hesitation whatsoever in recommending him. Outstanding.
  • Default Avatar75
    M Pearce, Marbella
    Monday, March 05, 2018
    Miguel was extremely helpful, he couldn't have done more:

    Always kept us updated on the progress of our purchase
    Always responded to emails in a professional and timely manner
    Always explained to... our understanding all aspects of the legalities about the purchase
    Very approachable,courteous and professional

    So much better to deal with than UK property lawyers!

  • Default Avatar75
    Tony, London
    Wednesday, February 28, 2018
    The service I received from nada was very helpful.

    The tasks were completed to the highest standard and would definitely use her services again in the future. All correspondence was received in a ...very timely manner. Highly recommended.
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    Holly, Lanzarote
    Friday, February 23, 2018
    The divorce process could have been explained more clearly and accurately so that a more realistic time for completion can be attained.
  • Default Avatar75
    Julia Alcock, Puerto Rico, Gran Canaria
    Thursday, February 22, 2018
    Esther was very friendly and approachable. She was professional and answered any questions I asked. We would definitely use her again in the future.
  • Default Avatar75
    Tamara Malcolm, Mallorca
    Tuesday, February 20, 2018
    Rosa was and is extremely knowledgeable and helpful. Her advice was excellent and i will definitely be using her expertise again in the future.
  • Default Avatar75
    Nick Nicolaou, Oviedo
    Tuesday, February 20, 2018
    Very Satisfied with Miguel's work. He was very helpful and we would definitely use his services again in the future.
  • Default Avatar75
    Gavin Jones, UK
    Monday, February 19, 2018
    It was a real pleasure to have Miguel working on my behalf to file my non-resident taxes. He was extremely helpful, gave reassuring advice and I had a high level of confidence in the transactions.

    ...Miguel is now acting as my fiscal representative in Spain and I plan to continue to use his firm's services for all my tax requirements.
  • Default Avatar75
    Martin Hickey, Benidorm
    Sunday, February 18, 2018
    Very friendly and knowledgeable and professional.

    Juan explained the plus and the negatives on various subjects and allowed us to make up our own mind.

    I have already recommended him to our fri...ends.
  • Default Avatar75
    Andrew Bullen, UK
    Friday, February 16, 2018
    Rosa was very professional at all times when dealing with me. Her English was second to none and she always kept me informed of progress via email promptly.

    I wouldn't hesitate to use Rosa in the ...future for any legal issues I have.
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    Tamara Reeves, Australia
    Thursday, February 15, 2018
    Anna was very knowledgeable and had prior experience dealing with English clients. She spent a lot of time explaining information and I was never rushed.

    I have continued to use Anna since my firs...t meeting as I trust her judgement and know that she will look after my best interests.
  • Default Avatar75
    Ali Hashemi, Alicante
    Wednesday, February 14, 2018
    Rafael was extremely helpful, accommodating and understanding. He couldn't have done more.
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    Alan W T Duguid, Montserrat, Valencia
    Wednesday, February 14, 2018
    Ramon was very helpful and answered my questions and explained the legal process that I was enquiring about.

    I would liked to have seen a follow up email detailing what was discussed to ensure that... my understanding and recollection of the meeting was completely correct.
  • Default Avatar75
    Keith Round, La Herradura, Spain
    Monday, February 12, 2018
    The advice provided was clear, easy to follow and allowed me to secure the required documentation from the Spanish Authorities quickly.

    Rosa was very proactive in following up when I was delayed in... providing inputs and always delay with any questions promptly.

    I would not hesitate to recommend Rosa to friends and colleagues and I would use her again in the future
  • Default Avatar75
    GWE, Ireland
    Thursday, February 08, 2018
    My lawyer Nada was extremely effective to make the case and get a result!
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    Chris Jones, Cambrils
    Tuesday, February 06, 2018
    Regardless of the situation Emma, looked for the best possible way to assist under the circumstances. Emma was very approachable and professional.
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    Richard Quick, Estepona
    Sunday, February 04, 2018
    I was particularly impressed by Miguel's approachability & professionalism, excellent service!
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    Stephen Grundy, Alicante
    Thursday, February 01, 2018
    Jose-Antonio's services are exemplary. Very satisfied and would definitely use this lawyer again.

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