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What Is The ‘complementaria’ Tax (hidden Tax)

All properties purchased are subject to a transmission tax. The percentage of this tax on the purchase price of the property can vary depending on the region and price of the property. Normally between 8/10%.   Each purchaser will pay this tax when signing the purchase.

Since around 2008 the prices of property in Spain have fallen substantially. There is also a glut in the market of properties being sold by the banks at below market value. The supplementary tax can arrive months later surprising the buyer who has legally paid the transmission tax. This occurs when the price of the property purchased is below the catastral assessment of the property value. It is the difference between this value and the purchase value that generates this extra tax.

A good conveyancing lawyer will advise a client of the probability of this tax so that the purchaser who is likely buying at a bargain price, can at least be prepared for the extra payment.

Those who receive such a tax bill may be able to contest the claim.

Please note: The information provided is based upon our understanding of current legislation. It is not legal advice but is provided freely to enable you to be properly informed. We recommend that if you are considering taking action, you should seek professional advice.

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