Property Tax Office

Is there an office in every town?	No. ….. Sometimes, in bigger towns and cities, the office is in a different location. In smaller towns, the “Oficina Liquidadora” is to be found in the same office as the “Registro de la Propiedad”. In bigger towns/cities, the office is in a different building.
What is the purpose of this office?	To check and prepare the paperwork for the payment of certain taxes due on property transactions, e.g. purchase and sale, inheritance, etc.
Where and how are these taxes paid?	Taxes are not paid at the “Oficina Liquidadora” (Property Tax office). This office controls the paperwork, and issues the relevant tax forms which reflect taxes due. These forms then require signature and presentation to a bank (listed on the form) for payment. The bank retain a copy, and there is one for the presenter and one should be handed in to the “Oficina Liquidadora” who issued it, so that the know the taxes have been paid. This form is sometimes presented independently and sometimes with the corresponding Deeds
What Taxes have to be paid?	Tax applicable to the purchase of property in general terms, in this area, is at the rate of 7%. In the Valencian Community", the rate of tax for Deeds of the "Declaration of Building", "Segregation", "Dissolving of Community", "Actos Jurídicos Documentados", and others, is now 1.0%.
How much Tax do I pay when I purchase a Re-Sale Property ?	The rate of tax applicable (Impuestos de Transmisiones Patrimoniales) for purchasing a re-sale property is 7% of the price declared in the "Deeds of Purchase and Sale" (Escritura de Compraventa). This rate of tax applies to the case of purchase of a property such as a house, an apartment, a piece of land, or a commercial premises.
How much tax do I pay if I buy a new property from a private owner ?	Buying from a private owner - It is important to know whether the owner has previously "declared" the building (Declaración de Obra Nueva) - if the owner has already completed this procedure (his/her obligation ! ) then the tax to pay will be 7% of the total price of land and house. If however, the owner has not declared the house, and only holds the Deeds of the land, then there is a "possibility" that you can purchase the land first, paying 7% tax, and then later declare the house, paying 1.0% (Escritura de Obra Nueva). But BE CAREFUL that all the paperwork in connection with the new house is in perfect order, especially the official requirement for the 10-year insurance obligation. See a solicitor - consult all issues and check the paperwork first - before proceeding.
How much tax do I pay if I buy a new property from a Construction Company ?	In general terms, in the case of purchase of a NEW DWELLING from a Construction Company, then the type of V.A.T.(I.V.A.) is 7% plus the extra amount of 1.0% which accompanies a V.A.T. Payment, known as “Actos Jurídicos Documentados “ (Documented Legal Acts). There are times when the V.A.T. is 16%, for example should you purchase an Industrial Unit, or a commercial premises, or simply a plot of land from the Construction Company. BEWARE !! - and always check out what the Tax is going to be, should you be interested in in purchasing a new property from a Company– ensure that you know what the costs and/or taxes are likely to be, which will be ON TOP OF the price of the Property for sale. It is common practice when dealing with the purchase and building of a new house from a Construction Company, to sign a private contract to engage the building of a house on a plot of land — BUT DO BE CAREFUL– Check with a Solicitor before entering into any written agreement as it is so important to make sure that any Purchase and Sale Contract linked to a Construction Contract contains ALL the correct and legal clauses and that all details adhere to the apartment or house that you intend to buy or have built.
If I purchase land first and then build a house, what taxes do I have to pay?	A) If you first purchase land from a private individual, you will pay 7% Transmission tax (Impuestos de Transmisiones Patrimoniales) of the purchase price to be declared in the Deeds of Purchase and Sale. If you decide later to build a house, then when you declare the building (Declaración de Obra Nueva) the tax you pay is 1.0% of the cost of construction. B) However– if you first purchase land from a Construction Company, then V.A.T (I.V.A.) is applied, and the rate is 16% If you decide later to build a new house, then V.A.T (I.V.A.) will be applied at the rate of 7% of the cost of construction. BEFORE ENTERING INTO ANY AGREEMENT– do make sure that you obtain a written estimate which reflects ALL the amounts due for payment including the amount of taxes due—so that you know the total cost of the property purchase and construction.
If segregation of land is carried out, what rate of tax applies?	The rate of tax for this procedure is 1.0% of the price declared in the Deeds of Segregation (Escritura de Segregación)
Should I wish to disolve the Deeds which I hold with my spouse - how much tax would I/we pay?	If the Deed owners wish to "dissolve" their property ownership, then the tax applicable for this type of procedure is 1.0% of the total amount of the value of the property declared in the Deeds.