Property transaction - help!
- hillybilly
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Property transaction - help!
I'm in the process of negotiating a sale on one of my properties (fingers xd!!!!). I'm resident & tax resident in Spain, the potential buyer isn't (but already has NIE no etc I think). It's a cash buyer, his money presently being in sterling. As the negotiation process is involving anything and everything to try to obtain the best deal for both of us, I have thought about the transaction taking place in sterling, not euros, to possible save some fees. I personally don't care what currency I get right now!
But, is this option even possible for a resident? If it is possible, what are the potential pitfalls, how would it be arranged with the notary etc etc? Or is it a potential can of worms and I should just stick with euros?????
Help please!
But, is this option even possible for a resident? If it is possible, what are the potential pitfalls, how would it be arranged with the notary etc etc? Or is it a potential can of worms and I should just stick with euros?????
Help please!
- hillybilly
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Re: Property transaction - help!
p.s. It is not my main residence - so what will the CGT implications be?
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Re: Property transaction - help!
No, you cannot receive payment in sterling as a resident.
As a resident there will be no retention but you must declare the sale on your annual tax return. If you sell by the end of the year you will declare it in May/June next year otherwise the following year.
As a resident there will be no retention but you must declare the sale on your annual tax return. If you sell by the end of the year you will declare it in May/June next year otherwise the following year.
Let's go Brandon!
- hillybilly
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Re: Property transaction - help!
Thanks Beachy!!!
Euros it is then.
We've just agreed the deal and he's already paid a deposit to his lawyer.
The sale is unlikely to be completed this side of 31 Dec so fortunately I won't have to declare/pay until 2013.
Euros it is then.
We've just agreed the deal and he's already paid a deposit to his lawyer.
The sale is unlikely to be completed this side of 31 Dec so fortunately I won't have to declare/pay until 2013.
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Re: Property transaction - help!
There is, ahem, a way of circumventing the sterling problem, but it depends on there being absolute mutual trust between you and the purchaser.
The purchase must be in euros as you are a resident so the purchaser has to give you a bank draft corresponding to the sale price a copy of the draft being incorporated in the escritura. You no not pay in this draft but the purchaser gives you the funds in sterling.
The dangers are for you: that the sterling cheque bounces and you will have no legal redress and, for him: that you will cash his bank draft anyway and obtain payment in both sterling and euros. Unless you are desperate for sterling I think it would be best to go with the flow and accept the payment in the form of a bank draft drawn on the Spanish bank which is handed over to you before the notary at the moment of the signing.
The purchase must be in euros as you are a resident so the purchaser has to give you a bank draft corresponding to the sale price a copy of the draft being incorporated in the escritura. You no not pay in this draft but the purchaser gives you the funds in sterling.
The dangers are for you: that the sterling cheque bounces and you will have no legal redress and, for him: that you will cash his bank draft anyway and obtain payment in both sterling and euros. Unless you are desperate for sterling I think it would be best to go with the flow and accept the payment in the form of a bank draft drawn on the Spanish bank which is handed over to you before the notary at the moment of the signing.
Let's go Brandon!
- hillybilly
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Re: Property transaction - help!
Thanks. Not desperate for sterling so will stick with euros.
Next question - I have all my old tax returns here...but I seem to recall that I will need a piece of paper from Hacienda - a certificate of fiscal residency? Do I simply go to my local AEAT office armed with my old tax returns and request one?
Next question - I have all my old tax returns here...but I seem to recall that I will need a piece of paper from Hacienda - a certificate of fiscal residency? Do I simply go to my local AEAT office armed with my old tax returns and request one?
- janda_grant2
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Re: Property transaction - help!
Don't think you need your tax returns just your bar code - we got ours from Osuna with no problems
I can spell but I can't type
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Re: Property transaction - help!
AEAT will (should) have all of your tax returns on record. You will only need to produce them if there is any problem with their IT system (so you may well have to do so!)
You can apply for the certificate online if you have an electronic signature.
You can apply for the certificate online if you have an electronic signature.
Let's go Brandon!
- hillybilly
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Re: Property transaction - help!
OK thanks.
No electronic signature so shall go to Osuna with my bar codes (plus everything else, just in case!).
No electronic signature so shall go to Osuna with my bar codes (plus everything else, just in case!).
- hillybilly
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Re: Property transaction - help!
Thanks. This one's taken nearly 2 years - am selling at a loss and even throwing in a vehicle...
- Devils Advocate
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Re: Property transaction - help!
I hope it's not the Aston
Property owner in Andalucia since 2002. How time flies.
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Re: Property transaction - help!
Is there anything to stop a non resident selling a spanish property to another non resident for sterling?
1. What would be the process re notaries etc.
2. Any implications for seller's tax liability in Spain
3. Any implications for buyers' tax liability in Spain
4. Why would anyone do this other than to avoid the minimal 1% currency conversion and transfer costs?
1. What would be the process re notaries etc.
2. Any implications for seller's tax liability in Spain
3. Any implications for buyers' tax liability in Spain
4. Why would anyone do this other than to avoid the minimal 1% currency conversion and transfer costs?
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