In Spain paying taxes is an imposed religion and as announced Pedro Sanchez With much fanfare a few weeks ago, everything indicates that in the coming months we Spaniards will have to dig deeper into our pockets. The Administration is preparing another increase in personal income tax and these taxes must include those that we also pay at the local level, such as municipal capital gains. A sentence of Supreme Court It says that local councils must proceed to return this payment if certain conditions are met.
First of all, we first have to be clear about what the municipal capital gainsthe tax paid at the local level to municipalities. Its original name is Tax on Increase in the Value of Urban Nature Assets (IIVTNU) and taxes the increase in value of urban land at the time they are transferred. That is, this tax arises in the transfer of the land whether it is going to be built or not. When it comes to the transfer of a home, this tax must be paid because the land is transferred, whether the home is to be modified or not. Since its imposition, this tax has been levied on the transfer of houses, apartments, garages or premises.
Therefore, a person will have to pay the municipal capital gains to the city council in the case of sale, donation or inheritance of a property. In the case of a sale, the term to pay it will be 30 days, while if there is an inheritance this extends up to six months. Logically, the one who has to pay the taxes is the buyer in the case of a purchase and sale and in the case of inheritance or donation the people who receive it.
In this way, this tax taxes the increase in value of the land itself from when it is acquired until it is sold and to calculate the tax two concepts are taken into account. On the one hand, the cadastral value at the time of transfer to verify the value of the land and also the tax rate, which is a piece of information that the city council values based on the location of the land in question.
The Supreme Court and municipal capital gains
The Second Section of the Third Chamber of the Supreme Court A few months ago, it issued a ruling that will establish jurisprudence and mark a before and after with regard to municipal capital gains. He High Court has declared at the time that what was paid in municipal capital gains can be recovered in sales in which there was no increase in value, even if there was a final settlement.
Tourist apartments in front of the beach.
The sentence of February 28, 2024, published by the magistrate Rafael Toledano Canteropoints out that the city councils can be requested to refund the amount paid in addition to the corresponding interest since in the case of transactions in which there was no increase in value, a profit that did not occur has been paid.
According to the website of the Spanish Lawyersin this ruling “considers that in these situations there is a violation of the principle of economic capacity and the prohibition of confiscation guaranteed by art. 31.1 of the Spanish Constitution, and that the Constitution itself requires that they be left without effect, as far as possible, since they are effects of the application of an unconstitutional law.
In this way, the people who once sold the home and did not make any profit and despite this paid the capital gain to the city council, according to the Supreme Court, have the right to have the amount paid returned in addition to some interest.
How to request the return of municipal capital gains?
The steps to be able to request the return of the municipal capital gain if you meet the conditions are simple: the first thing you must do is present a letter to the city council demanding rectification and return of the capital gain.
In the event that the council ignores and rejects the request, the second step is to present an appeal and if this is not successful, the third and final step is to go to court. So the injured parties will have to file a contentious-administrative appeal before the Superior Court of Justice of the corresponding autonomous community. Given the Supreme Court ruling, you will have everything to win there.
