As a real estate agent in East Málaga, we are obliged to tell you that if you sell a flat in Malaga, you have to know that not everything is profit. And one of the first things we found out about when we wanted to sell a flat in Malaga, if we did not already know, is that we have to pay a tax for added value. Now, the question is this: how to calculate local tax for flat’s sale in Malaga?
What is local tax?
When transmitting a property through a commercial negotiation, a municipal tax called «Tax on the Increase of Value of Urban Land» must be paid. It should be noted that in the case of properties transferred by inheritance, the tax must also be paid. IIVTNU, are the acronyms that are used to refer to the most commonly known as Municipal Capital Gain.
Who pays the local tax?
If it is a transfer of property by sale, it is the seller who pays the local tax. Otherwise, if it is a transfer of property by inheritance, the heir would be responsible for paying the local tax.
Hoy to calculate local tax on property sales in Malaga?
The cadastral value of the property, updated to the date of transmission of the same, according to the requirements of each municipality, is applied a coefficient of added value.
Let’s see what would be the maximum possible values of these coefficients to get an idea: 3.70% would correspond for each year, when it comes to a property that is between 1 and 5 years old (from the moment of purchase to sale), 3.50% for each year, any property that is between 6 and 10 years old; 3.20% per year, for properties between 11 and 15 years old; and, finally, 3% for each year, those properties that are between 16 and 20 years old.
It is important to note that the maximum number of years to compute is 20. That is, for all those cases where there is a period between the date of purchase and sale over 20 years, the calculation would be, only and exclusively, the following: 20 x 3% (60%). Setting this value at most.
Then, once we know which coefficient of added value corresponds to the cadastral value of our house, we calculate, finally, the local tax of the sale or by inheritance. For this, we apply the respective coefficient of added value, without decimals, to the cadastral value. What will give us as a result the tax base on which the tax in question will be applied.
Finally, we calculate the final amount to be settled. Which will vary according to the type of tax that corresponds according to each municipality. At most 30% on the tax base. And, in this way, we will have solved the question of how to calculate local tax on property sales in Malaga.
An example with the municipality of Málaga
Acquisition date: 1995
Estimated date of transmission: 2019
Number of years: 24 (más de 20)
Cadastral value of the land: 24.766,28 €
Annual percentage: 3%
Increase in value: 20 x 3% = 60%
Tax base: 14.859,6 (calculada sin contar los decimales del valor catastral)
Tax type: 30%
Total to liquidate: 4.457,88 €
The last new
On December 4, 2018, against the hacienda criterion, the Spanish high court included taxpayers who received a property by inheritance or donation as to the exceeding of the municipal tax payment in case of loss of value of the house between the year of the acquisition of the previous owner’s house and the year of the new owner’s inheritance or donation. Previously said regulations only applied for those properties that were transmitted by purchase.
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