Buying a repossessed property in Spain? Beware Hidden Stamp Duty CostsAlternative Methods to Calculate Stamp Duty on Undervalued Property
The banks do not tend to volunteer this information to the purchaser, with the consequence that the buyer must fund the payment of the additional tax demand, thus increasing the overall cost of the property – in some cases, significantly. To avoid this outcome, it is simply necessary to check the minimum fiscal value before going ahead with the purchase, so that if this value is above the offered price of the property, there are two options:
- Calculate the payment of stamp duty on the minimum fiscal value, regardless of the actual purchase price of the property.
- Calculate the payment of stamp duty based on the actual price paid and try to appeal the additional tax demand that the tax authority will send. In this scenario, it is important, if there has been any deterioration in the property, to take photos of the state of the property and keep hold of the receipts connected with any repairs (as opposed to improvements) carried-out so that you can include them with the appeal and thereby try to justify the lower price paid for the property.