Capital Gains Tax Discrimination Spain

Capital Gains tax Discrimination in Spain

The European Community Treaty rules on capital gains discrimination which includes
Mallorca, the Spanish tax authorities unduly over charged capital
gains tax to those classified as "non residents" on property sold
between March 2004 and December 2006. This means that many thousands
of British  could qualify for a substantial capital gains tax rebate plus interest.

Shocking figures statistics for mallorca and Spanish mainland in respect of capital gains tax.

According to publicly available statistics from the Spanish Ministry
of Housing (Ministerio de Vivenda), 'non-residents' bought and sold
over 16,000 properties per year in Spain. Some 50% of those property
purchases and sales were made by British people who have moved
overseas. nearly 18% of that total was house property sales  rather
than purchases. Should these estimates befound to be correct, it means
that the Spanish government could owe British overseas owners over
€53.20m, (around £42.26m), in capital gains tax refunds. Before the
pound dropped it was around 37.21m in sterling.

The average capital gains tax bill for 'non residents' in respect of
property was around €20,600, (£14,500), between 2004 and early of
2007. Comparatively, the average capital gains charges paid by Spanish
residents for property over the same period was at just €8,892,
(£6,224). On average, Spanish non-residents' paid a tax rate of 35% on
capital gains instead of the Spanish national flat rate of 15%. Which
all means  to 'non-residents' being charged a 20% higher rate than
Spanish nationals in respect of properties purchased and the amount of tax. See follow up
article: Will the government of Spain admit fault in this tax area.