Autor: admin

NIET-GETROUWDE LANGSTLEVENDE BETAALT HOGE ERFBELASTING

NON-MARRIED LONGEST LIVING PAYS HIGH INHERITANCE TAX

Geschrieben von admin am 29 Januar, 2018. Veröffentlicht in Andalusian, costa del sol, english speaking solicitor, Inheritance Tax, lawyer, malaga, Unkategorisiert, wills.

THE CURRENT SITUATION OF INHERITANCE TAX

On 1 January 2018, a new reform of Inheritance Tax entered into force in Andalusia, the main change of which was to raise the tax-exempt amount to one million euros. This new reform changes the reform introduced a year ago, which we explained in our post of November 2016.

Which heirs would be exempt from Inheritance Tax?

Heirs that meet each one of the following requirements would be exempt:

For the heir to be included in groups I and II as established in the regulation governing this tax, the heir needs to be the spouse, child, grandchild or parent of the deceased
For the value of the estate to be inherited per heir does not exceed one million euros
For the pre-existing assets of the heir to be less than one million euros
For the heir to be a citizen of a Member State of the European Union or, if they are citizen from outside the European Union, both the deceased and the heir must reside in Andalusia

What happens with other family members who inherit?

All other heirs, such as siblings, nephews, nieces, uncles, aunts and cousins of the deceased are included in groups III and IV of the Inheritance Tax and will continue to pay the same amounts.

In other words, these heirs will pay inheritance tax from the first euro they inherit except for heirs in group III, who are able to deduct an amount of 7,993.46 euros. This means, for example, that if John leaves his nephew his Nerja property valued at 240,000 euros as inheritance, his nephew will have to pay about 63,000 euros in Inheritance Tax.

What happens if you inherit from your best friend?

You would be included in group IV of this regulation. This means that if John, instead of leaving the 240,000-euro property to his nephew leaves it to his best friend, he or she will have to pay about 80,000 euros in Inheritance Tax.

How are property values calculated for Inheritance Tax for non-married longest living?

Every year, the Regional Government of Andalusia publishes a regulation that establishes certain coefficients to update the values of urban properties located in Andalusia. These coefficients are applied to the cadastral value of the property; this you can find in your Property Tax receipts. The result of applying these coefficients to the cadastral value is what we call the minimum taxable value.

The regulation explained above deals with the minimum taxable value of urban property but, in the case of rural property, this isn´t applicable. Therefore it is necessary to obtain a valuation from the technicians of the Regional Government of Andalusia to calculate the minimum taxable value. However, the Regional Government of Andalusia in the province of Malaga uses the coefficients published every year by the College of Architects of Malaga to calculate the value of rural properties.

Regarding the means used by the administration to calculate the minimum taxable value of properties in Andalusia –as well as other Autonomous Communities–, there is much controversy in general and there is the possibility to challenge those values in the event that the person liable to pay the tax deems them excessive or not adjusted to reality. This topic is complex enough to be covered in a whole new article.

NON-MARRIED LONGEST LIVING OR UNREGISTERED COUPLES IN ANDALUSIA

Who are we talking about?

In the event that a couple is not married –either in their country of origin or in Spain–, if one of them dies and leaves the other member of the couple as an heir, for the purposes of Inheritance Tax this person would be considered to be in group IV. In other words, in this case the partner is considered to be just a friend putting the person in the group with the highest rate of Inheritance Tax.

What happens to common-law partners registerd in Andalucia?

In Andalusia, couples registered in the Registry of Common-Law Partners of Andalusia are equivalent to married couples for the purposes of Inheritance Tax, for which reason they would benefit from the deductions for spouses explained above.

What happens to common-law partners registered in another Member State of the European Union?

In this case, the Regional Government of Andalusia does not recognise such registration for the purpose of Inheritance Tax, for which reason those couples would pay tax as though they had received inheritance from a friend, leaving them in the group taxed at the highest rate.

If John leaves his partner Mark 50% of the property they both purchased in Almuñecar in 2005 and if the fiscal value of that 50% is 120,000 euros, Mark, the heir, would have to pay about 30,000 euros in Inheritance Tax for inheriting 50% of that property.

If John and Mark had been married or registered in the registry of common-law partners of Andalusia, Mark would not pay a single euro for inheriting 50% of the property from John.

What should be done in this case?

If you have property in Spain with your partner and you would like him or her to inherit your part and you are unmarried, we advise that you get married (either in Spain or in your country of origin) so that you can benefit from Inheritance Tax reductions. Those who don´t want to get married, can register themselves in the Registry of Common-Law Partners of Andalusia (Registro de Pareja de Hecho) and then the status would be equivalent to that of a married couple.

Property owners who are not citizens of a Member State of the European Union

In this case, heirs may not benefit from reductions for spouses, children, grandchildren and parents of the deceased, so they would pay Inheritance Tax in the event that they inherit. They can only avoid this if both the deceased and the heir are resident in Andalusia.

Author: Gustavo Calero Monereo, lawyer at C&D Solicitors Torrox (Málaga, Andalusia)

DAFO Certificaat aankoop huis platteland Andalusie

THE PURCHASE OF HOMES AND DAFO/SAFO CERTIFICATES IN ANDALUSIA

Geschrieben von admin am 8 Juni, 2017. Veröffentlicht in Andalusian, costa del sol, lawyer.

Lately, in the purchase of rural homes, one of the most important points discussed between buyers and sellers is the procedure “Asimilado Fuera de Ordenación”, –DAFO or SAFO–. What it is, what its consequences are, who does it, who assumes the cost, etc.

Basic rules to buy in the countryside in Andalusia

Before talking about this procedure, and based on my experience with clients looking for a home in the countryside, it is necessary to mention that, in non-development land in Andalusia –rural land–, it is not possible:

To build homes, unless the intention is to engage in agricultural or livestock-farming activities in a professional capacity on the parcel.
Existing buildings may not be expanded and/or remodelled, both inside and outside. People have to purchase what is already built and no changes are legally allowed.
It is permitted to build with the intention to operate rural accommodation or a bed & breakfast, but it is necessary to carry out a preliminary operational project – called in Proyecto de Actuación -, that the Government of Andalusia must approve. This procedure can take over 6 months and it is difficult to obtain a positive response from the Regional Government.

It is necessary to take into account that most homes currently sold in the Andalusian countryside are illegal or irregular, i.e. if the authorities had done their work, they should not have allowed construction and, therefore, they should not exist.

The case is that, for most buildings, it is not possible to start any penalty procedures against buildings built without a licence or with an illegal licence on non-development land due to the time elapsed.

This means that legal responsibility is time-barred since over six years have elapsed since the end of construction. When we refer to non-development land with any special protection, the period of six years does not apply.

What buildings can and cannot be constructed in the countryside

In non-development land, a construction licence cannot be granted to remodel or rebuild. For instance, in the event of a fire when the home would be completely destroyed, it´s not allowed be rebuilt.

It is possible to grant a licence for small repairs or modifications necessary for the habitability and safety of the home, such as, for instance, replacing part of the roof or a wall that has been damaged or has collapsed.

Why was DAFO/SAFO created?

Because of the above, the Government of Andalusia approved regulations in 2012 with the idea to regularise, not legalise, thousands of homes built on non-development land –rural land–, in breach of urban-planning regulations. Since 2012, City Councils have started to create internal regulations to govern this procedure.

Speaking colloquially, with the resolution of Assimilated out of Ordination – Asimilado Fuera de Ordenación -, the goal is to have a record with a specific date of what has been built on that property –both inside and outside each building–, how many years have elapsed since construction and to certify that the home can continue to exist without penalties in the future, even though it will not be possible to expand it and/or remodel it or to build new structures.

This is not a legalisation because the home is left outside urban regulations –as it was built illegally– but it is a regularisation as the City Council itself certifies this legal situation and confirms in writing that it will not be possible for this home to be subject to a penalty due to the time elapsed.

The legal situation of a home in non-development land does not change after receiving the resolution of DAFO/SAFO from City Hall, i.e. the home will continue to be illegal as it was built on land where construction is not allowed but, since the time limit established by law to issue a penalty for this infringement has elapsed, this procedure against the owner cannot be started due to this situation. With or without a DAFO certificate, the legal situation remains the same.

DAFO/SAFO Procedure

In this procedure, it is necessary to have a project by an architect, to pay a fee on the value of the building on the date it was built, which may range from 2.5% to 4.5% depending on the City Council where the property is located, and the City Council will also verify the water and electricity supply as well as the need for a septic tank so that the home can comply with regulations.

It will actually be the architect paid by the owner who will inform, in his or her project, everything necessary for the home to be eligible for a DAFO certificate. Once the project has been submitted, the architect from the City Council will visit the property to inspect it and verify whether it complies with the requirements for a DAFO certificate.

Once this procedure is completed, which may take between 4 and 6 months, the City Council will issue a resolution certifying Assimilated out of Ordination – Asimilado Fuera de Ordenación -, from Regulation for that home and all structures built on the plot.

Is DAFO mandatory for the sale of a home?

To buy or sell a property, holding a DAFO/SAFO certificate is not a legal requirement. That being said: is obtaining a DAFO/SAFO certificate for a property good or bad?

In favour of the DAFO certificate, we can mention that buyers will have the certainty that what has been built already cannot be subject to a penalty and/or demolished because it is accredited in writing that legal responsibility is time-barred, with the certificate from the City Council granting the DAFO certificate. Likewise, it will provide certainty that the City Council will not require you to obtain a DAFO/SAFO certificate for the home in the future, as the procedure was already completed at the time of purchase.

It should be taken into account that, currently, nearly no City Council offers any information in writing regarding a property built on non-development land unless it holds a DAFO certificate or processes it.

This means that, if you go to get something in writing, they tell you that you certainly can but you first need to process the DAFO certificate for your home. This means that, if you do not want to obtain a DAFO certificate for any reason, it will be very difficult for buyers or their lawyers to obtain information in writing about the property.

The downside of having the DAFO is that, if there are any structures or remodelling –inside or outside– completed within the last six years or if the land on which the property is located is subject to any type of protection (and it can´t be proven that the buildings are old enough), applying for this procedure can only cause problems to the owner as the City Council will be required to initiate penalty procedures.

Likewise, if the new owner is thinking about remodelling after buying the home –ignoring the advice of a good lawyer–, the City Council will already be perfectly aware of what had been built before and it will be easier for them to prove that the structure has been remodelled or some variation has taken place.

It is also necessary to take into account that it may be possible for a property to obtain a DAFO certificate in 2016 and remodelling or expansion of that home to take place in 2017. What I mean with this is that complete certainty in this sense can never be achieved.

Current status of the DAFO certificate

It is true that the processing of this certificate is starting to become common at City Councils because they have also realised that it´s tax payment is an important source of income.

Many City Councils have an unwritten rule to start an application automatically when they receive or someone requests any type of information and/or documentation about a property on rural land, so we can say the owner would be obliged to make the DAFO.

In the situation mentioned above, many buyers want to prevent having to pay for the cost of the procedure themselves, which has resulted in an increasing number of buyers requiring the seller to process it and pay for it.

It is also true that, in some sale transactions where a DAFO certificate is not desired, a reduction in the sale price is usually agreed with the seller and the new owner will decide whether to apply for it in the future.

Is possible to get a mortgage in a property with DAFO?

Another issue that some clients ask about, is whether it is possible to grant a mortgage for a property with a DAFO certificate.

On this matter, the reality of the property market goes beyond the legal limitations in force since 2009 as, even though it is not theoretically possible to grant a mortgage for buildings or structures exempt from regulations, the reality is that there are banking entities that do grant mortgages for properties out of ordination or assimilated out of ordination, i.e. rural properties.

In my opinion, if there is money to be made, banks will not stop granting mortgages for properties of this type -with or without DAFO- regardless of what the Decree of 2009 says. Obviously, mortgages approved for these properties usually offer a lower loan amount and not all banks offer mortgages on rural land.

Buying and selling homes in rural land

When buying and selling homes in non-development land, for them to be able to be included in the property market, with or without a DAFO certificate, there are no limitations or restrictions. This means that most of these properties are registered in the Property Registry and in the Cadastre and have already been sold or bought on different occasions even though few yet hold a DAFO certificate.

Currently, there continues to be an important portfolio of potential buyers interested in properties in the countryside.

The important thing, when someone is looking to buy a property on rural land, is for buyers to know what they are buying, be aware of the legal limitations of properties on rural land, and receive specific legal information about the property, with or without a DAFO certificate. This will enable them to make a decision with full awareness of the legal status of the property.

A lawyer to buy a property?

Lastly, it’s not that we’re trying to promote our services –well, maybe a little–, but in the purchase of a home, especially for homes like these, having a lawyer is never a bad idea as his or her fee will cost very little in comparison to the purchase price and can save you from many headaches or costly problems in the future.

Author: Gustavo Calero Monereo, lawyer at C&D Solicitors Torrox (Málaga, Andalusia)

RECLAMATION PLUSVALIA TAX FROM SALE PROPERTY AT A LOSS

Geschrieben von admin am 21 Februar, 2017. Veröffentlicht in Andalusian, costa del sol, english speaking solicitor.

plusvalia selling property — plusvalía, property, nerja

A few weeks ago, a seller was bitterly complaining to me about what they had paid for capital gains tax on the sale of their home in Capistrano, Nerja to a Swedish couple, even though no profit had actually been made.

I then remembered an article we published in June 2014 on this matter, where we spread the news about new case law defending the position of taxpayers who had sold a property at a loss and, furthermore, were forced by the city council to pay capital gains tax, even though no profit had been made from the sale of that property.

Many sales take place at a loss and there are many more to come as, in general, current prices are still below those in effect a few years ago.

In the two and a half years since the publication of that article, the position of taxpayers to be able to claim back what they had paid in municipal capital gains tax for the sale of their homes without having made any profit has improved and the government will probably be forced to amend the Law in order to prevent councils from continuing to demand payment in these situations.

First of all, if they want to cancel the capital gains tax bill received from the council, they must know that they need to pay it first and then file a claim, and they will then have no option but to resort to the courts to claim a refund.

However, according to a judgment of the Higher Court of Justice of the Community of Valencia in late 2016, it is not necessary to obtain an expert appraisal to prove the value of the property, as it is understood that the amounts shown in the purchase and sale deeds clearly determine the actual value of the property and, therefore, show whether a profit was made.

So far, taxpayers wishing to file a claim through the courts needed an appraisal to prove that the actual value of the property transfer was lower than the purchase price. However, through this judgment, the amount shown in the purchase and sale deeds can be enough to accredit the values of the property when, through examining the deeds, one can easily see that there has been no increase in the value of the land.

The strongest argument in favour of taxpayers is that the Constitutional Court, in its recent judgment of 16^th February, established that making citizens pay taxes for non-existing enrichment in the sale of their homes contradicts the principle of financial capacity set down in art. 31.1 of the Spanish Constitution. The Constitutional Court clarified that capital gains taxes are legal but it is unconstitutional to pay this tax when no actual gains have been made in the sale of the property.

The Constitutional Court also clarified that legislators will be the ones who will have to amend the legal framework of this tax in order to prevent taxation in these situations where no capital gains are made from the sale of a property.

Until the Law is amended, we assume that councils will continue to demand payment of capital gains taxes even when properties are sold at a loss but, after the pronouncement of the Constitutional Court and with the arguments set down in the other judgments mentioned, taxpayers will be able to claim back what they have unduly paid to the council in these circumstances. However, it is true that, for smaller amounts of capital gains tax, it may not be interesting to file a claim, taking into account the costs involved in hiring a solicitor and a barrister.

Many cities in this area: Nerja, Frigiliana, Torrox, Vélez Málaga, etc., issue bills for capital gains tax once the sale is recorded in a Public Deed, for which reason, in order to obtain a cancellation of this bill from the council, it would be necessary to challenge it before the deadline established by law.

If the claim is not filed before the deadline and, therefore, the administrative action becomes unappealable, it will become more difficult to file a successful claim.

Author: Gustavo Calero Monereo, lawyer at C&D Solicitors Torrox (Málaga, Andalusia)

SPAANSE INKOMSTENBELASTING VOOR NIET-RESIDENTEN (IRNR)

SPANISH INCOME TAX RETURN FOR NON TAX RESIDENTS (IRNR)

Geschrieben von admin am 17 November, 2016. Veröffentlicht in costa del sol.

Time for payment your income tax for non residents in Spain (IRNR)

If you are a non-resident in Spain and own a property there, you are liable to Spanish Income Tax for Non-Residents payment (Spanish IRNR). This issue was already considered in former article on our website.

You would have to pay this year the IRNR income tax for non-residents of 2015. This means if you owned, bought, sold or inherited a Spanish property in 2015 and you are NOT a fiscal resident in Spain, then you are obliged to pay your yearly IRNR income tax for non-residents this year (Impuestos sobre la Renta de No Residentes). As a service to our customers C&D offers to take care of this tax application and its payment through direct debit before the end of this year.

When a property is owned by a married couple or several persons, each of them becomes an independent taxpayer, so that they should file tax returns separately according to the ownership interest they have on this property.

This tax duty needs to be done before the 31^st of December 2016. If you want to pay through direct debit, though, it needs to be submitted before the 22^nd of December 2016. The tax liability will be calculated with the tax information of your property following the cadastre registry, usually the tax payment it isn’t going to be so much. If you miss this obligation you could be fined by the Tax Authorities.

Tax form 210 is used to pay this tax and it can be downloaded from the official web of the Spanish Tax Authority (A.E.A.T.). It is worthy mentioning that it is not easy to understand them.

Our office is currently dealing with the IRNR season 2015. The deadline to file this tax return expires on the 31st of December of this year. Although if you want to place the payment as a direct debit in your bank account the form must be filled before the 22nd of December.

If you want to hire our services for this tax duty, we will be pleased to help you.

Author: Francisco Delgado Montilla, lawyer at C&D Solicitors Torrox (Malaga / Andalucia)

ERFBELASTING IN ANDALUSIË: AANKOMENDE VERANDERINGEN

INHERITANCE TAX IN ANDALUSIA: CHANGES AHEAD

Geschrieben von admin am 12 November, 2016. Veröffentlicht in costa del sol, english speaking solicitor, Inheritance Tax, wills.

On 1 August, the Regional Government of Andalusia approved the first of two reforms of inheritance tax in Andalusia. This reform and the upcoming one aim to improve taxation for heirs.

The first reform affected the acquisition of a person’s usual residence by heirs and a series of reductions were approved, ranging from 100% to 95% when the value of the home exceeds €242,000. The reduction in inheritance tax in this sense is very significant.

However, it should be noted that only in estates inherited from parents by children (whether biological or adopted), spouses, relatives in the ascending line and persons related collaterally (siblings, cousins or grandparents) over the age of 65 can an heir in Andalusia opt for the reduction for the acquisition of the usual residence. Likewise, the following requirements must be met:

Having lived with the deceased person in the usual residence during the two years preceding death.
Maintaining ownership of this residence for 3 years.

Furthermore, the Regional Government of Andalusia has announced that it would complete a second reform of Inheritance Tax, which will enter into force on 1 January 2017.

In this case, the minimum exempt from Inheritance Tax in Andalusia will be of €250,000 per heir. I.e. heirs inheriting assets valued at an amount equal to or smaller than €250,000 will not have to pay Inheritance Tax in Andalusia.

As explained in a previous article, this exemption only applies to descendants or adopted children of the deceased person, as well as their relatives in the ascending line or adoptive parents and spouses, provided the pre-existing assets of the heir are equal to or less than €402,678.11.

Lastly, another substantial change should be noted as, for estates with a value of between €250,000 and €350,000, a minimum value of €200,000 is established. I.e. if the inheritance received by a child or widowed spouse is valued at more than €250,000, the first €200,000 would be exempt from inheritance tax and only the remaining amount would be paid, provided that the total value of the estate does not exceed €350,000. If this amount is exceeded, inheritance tax would be payable on the entire value of the estate, without the possibility to apply any exemption.

Lastly, I would like to remind you that the best way to plan your inheritance begins with your will, for which reason it is always best to go to an appropriate professional who can examine your situation and give you personal advice.

Author: Gustavo Calero Monereo, C&D Solicitors, Malaga, Andalusia.

TIME LIMITATION FOR RESPONSIBILITY: ILLEGAL SUBDIVISIONS RUSTIC LAND ANDALUSIA (DAFO)

Geschrieben von admin am 25 September, 2016. Veröffentlicht in costa del sol.

illegal subdivision rustic land andalucia

On 6 August 2016, the amendment of article 183.3 of the Urban Planning Law of Andalusia (LOUA) came into force.

The main objective of this amendment was to introduce a statute of limitations for subdivisions in non-developable land that contain buildings. Since 2003, the Administration was able initiate the administrative proceedings for the grouping of these plots divided illegally at any time, which entailed an order to demolish anything built illegally on such lands. There was no time limit, i.e. the legal responsibility never expired.

What this amendment has done is introduce a statute of limitations of six years for such subdivisions, provided that they contain buildings over six years old. This statute of limitations introduced for buildings constructed in non-developable land, results in the legal responsibility expiring after six years without the administration initiating proceedings against such subdivision.

It should be made clear that subdividing rural land means the segregation or division of a plot of land into several more plots, usually for the purpose of selling these plots independently and building there. These subdivisions are illegal unless they comply with the smallest unit for crops, which, in dry lands, is usually between 20,000 and 25,000 square metres. The general idea is to limit plots in rural land from being divided to form new independent properties as much as possible.

This is not a minor issue as, both before and after the passage of the LOUA in 2003, thousands of illegal subdivisions of rural land that did not comply with the smallest unit for crops took place in Andalusia. This situation was widespread until 2009, when the economic crisis put an end to frantic speculation in the property market.

The existence of thousands of such subdivisions led to the sale of many properties originating from illegal subdivisions, which were then transferred to other buyers, whom were also transferred the legal “problem” represented by the possibility of the Administration initiating procedures against them.

This was a situation that created a high level of legal uncertainty, as the offence of dividing such land illegally never expired. The sale of these plots led to the appearance of third parties acting in good faith.

In practice, the Administration in general and City Councils in particular did not have –and do not have– any interesting in pursuing proceedings against these subdivisions to re-establish legality in urban planning. In fact, the enforcement of the resolutions of these proceedings, by grouping all segregated plots into a single property in the Land Registry and in the cadastre, with the demolition of anything built illegally on such plots, seems a complicated task, not to say an impossible one.

In addition to this, the fact that there was no statute of limitations caused a situation of comparative tort, as the offence of having built on non-developable land, on a plot that did not come from a subdivision, would expire after six years. However, if the building was located on a plot divided illegally, the building could be “attacked” with no temporal limit as the offence of subdivision did not expire, i.e. despite the building being over six years old.

I think this amendment is sensible, as it equalises the statute of limitations for plots with buildings and that of buildings constructed on non-developable land. This will lead to greater legal certainty, with the ability to determine the legal regime applicable to these properties clearly.

The logical consequence of this amendment is that buildings that are over six years old and that are built on land subdivided illegally will able to apply for the Assimilated-Outside-of-Planning Procedure (DAFO).

This procedure does not entail the legalisation of the building as the situation of illegality is always maintained but it can lead to greater legal certainty, as the City Council will certify the situation of the property on which legal liability has expired, without the possibility of being “attacked” again by the Administration itself, provided that, of course, no new buildings, renovations or improvements are made on said building.

This recognition, in addition to being a relatively significant financial outlay for the owner, will also entail the certification of a series of limitations for buildings on rural land, despite the fact that, with or without DAFO status, these limitations still exist. It will be up to each owner or new buyer to decide whether he or she is interested in requesting that recognition for the property in question, without forgetting that the City Council can require the owner to initiate it ex officio.

Author: Gustavo Calero Monereo, C&D Solicitors, Malaga, Andalusia

BODEMCLAUSES HYPOTHEKEN: NEGATIEF RAPPORT VAN CJEU

FLOOR CLAUSES MORTGAGES: NEGATIVE REPORT FROM CJEU

Geschrieben von admin am 1 August, 2016. Veröffentlicht in Andalusian.

In our last article in May, related to floor clauses, we explained that judicial proceedings before the CJEU (Court of Justice of the European Union) are currently taking place.

The purpose of these proceedings is to decide whether Spanish banking entities have to return all the money unduly charged through floor clauses or, on the contrary, they only have to return the amounts unduly charged after 9 May 2013.

The preliminary opinion of the advocate general taking part in these proceedings establishes that banks should only have to return the amounts unduly charged after 9 May 2013.

The Judgement in these proceedings is expected for late this year and, even though the opinion of the advocate general is not binding, it is usual for the Court’s Judgement to follow the same reasoning.

Regardless of the surprise that this opinion has caused among many lawyers and judges, we must remember that Spanish banks will have to return the amounts unduly charged after 9 May 2013 through floor clauses, and this will not change, regardless of the Judgment of the CJEU, as these proceedings will only decide whether banks will have to return the amounts unduly charged before 9 May 2013 or only those amounts unduly charged after this date.

It is very important for everyone affected by floor clauses in a mortgage to file a judicial claim to recover the amount the bank has charged unduly, as well as to prevent the bank from continuing to charge them more money than the agreed interest rate for their remaining mortgage periods. The success rate in these proceedings is quite high and banks would be ordered to cover court costs caused by these proceedings.

Currently many banks are trying to prevent customers from initiating judicial proceedings by offering false solutions such as agreeing on a fixed interest rate for mortgages. Don’t sign or agree to anything without talking to a specialised lawyer as most of these solutions only seek to keep the bank from having to pay you everything it owes you and make you waive your right to file a judicial claim.

Thanks to our agreement with the Gallego & Rivas law firm, which specialises in banking law, we can study your case at no cost, completing an initial assessment of your documentation and giving you an estimate of the total amount of money you could claim, as well as the money you would save in the future by eliminating the floor clause from your mortgage. This is all with no commitment to hire our legal services.

If you are interested in getting this consultation free of charge, the way to proceed is to contact us at info@cdsolicitors.com, giving us your contact details and sending us a copy of your Mortgage Deed as well as the latest invoice for your mortgage loans. We will be happy to help you and clarify your legal status.

Author: Gustavo Calero Monereo, C&D Solicitors (Lawyers)

GRATIS CHECK BODEMCLAUSULE HYPOTHEKEN SPANJE

FREE CHECK SPANISH MORTGAGE WITH FLOOR CLAUSES

Geschrieben von admin am 18 Mai, 2016. Veröffentlicht in Andalusian, english speaking solicitor.

CLOSER TO A DEFINITIVE SOLUTION FOR THOSE AFFECTED

The first thing I would like to do is inform you that C&D Solicitors has signed a collaboration agreement with the Sevillian law firm Gallego & Rivas, which specialises in financial and banking law.

On the basis of this agreement, Gallego & Rivas have offered to study the documentation of homeowners who may be affected by a “floor clause” (cláusula suelo) in their mortgages, free of charge. At the end of this article, we will explain how those affected can get access to this service.

First of all: What is a “floor clause”? A mortgage is said to have a “floor clause” when, in a variable-interest mortgages, there is a clause in the Deed of the Mortgage Loan establishing that the interest for this mortgage cannot be lower than a certain threshold.

In other words, in this case, the mortgage cannot benefit from a low interest rate and from the successive drops that may occur, as the minimum interest rate is “shielded” and any interest rate set below the one established in the “floor clause” cannot be applied. For several years, the Euribor rate has been very low and these clauses have represented considerable losses for many customers.

For the last few years, there have been many legal proceedings in Spain brought by people affected by “floor clauses” in their mortgages. In fact, almost five years ago, we published our first article about this matter, echoing the first judgments. We should keep in mind that mortgages with “floor clauses” were common until 2009 or 2010.

Most judgments have sided with the complainants. Likewise, the Supreme Court pronounced itself in May 2010, declaring these clauses null.

So far, the legal arguments are clear so people with a “floor clause” in their mortgages have a very good chance of obtaining a favourable ruling. Such ruling would order the bank to eliminate the “floor clause” of the mortgage, as well as to return the money that customers have overpaid in their mortgages, in addition to the legal costs of the proceedings.

In its judgment of May 2013, the Supreme Court, in its legal reasoning, only ordered the banks to return the money unduly charged to customers from 9 May 2013 and not since the clause started to be applied to the customer. I.e. what was unduly charged before that date was not eligible for a refund.

The Supreme Court appealed to the economic turmoil that it could represent for banks to return the total amounts unduly charged to customers before 9 May 2013 as, considering that there are thousands of mortgages affected by a “floor clause”, banks would be forced to refund billions of euros to their customers.

Due to the controversial nature of this legal reasoning, a Commercial Court in Granada raised a prejudicial question to the Court of Justice of the European Union (CJEU) so that it would pronounce itself on whether banks should refund the amounts overcharged to their customers from moment that the “floor clause” in their mortgages was applied instead of from 9 May 2013.

On 26 April, the CJEU held the public hearing on these proceedings and, on 12 July, the advocate general of the CJEU will present his findings. At the end of the year, we will know whether Spanish banks will have to return everything unduly charged or just the amount overcharged after 9 May 2013.

It seems that there are good chances that the CJEU considers that everything unduly charged to every customer with a “floor clause” must be refunded. The decision is transcendental since –according to some sources– we are talking about 7 thousands millions of euros.

These 7 thousands millions of euros would be added, to the 5 billion euros that banks are estimated to be required to refund to customers, for everything unduly charged from 2013 to the present day.

Regardless of the date set by the CJEU, “floor clauses” are abusive and those affected have the right to file a complaint to get their money back. This is why we have signed an agreement with the law firm Gallego & Rivas, which has offered to study the documentation of homeowners who may be affected by a “floor clause” (cláusula suelo) in their mortgages and provide them with a short report on their situation.

The study of this documentation would be free of charge and legal advice would also be provided to recover the money lost and the cost of the proceedings. Customers can then decide whether they want to initiate legal proceedings.

Later, according to the number of persons interested in taking legal action against their banking institution, we could set up a day at our office in Torrox-Costa (Malaga) so that those affected by a floor clause in their Mortgage Deeds can get first-hand contact with Gallego & Rivas.

Ultimately, the affected person will get a specialist lawyer to study his case at no cost and advise him of the potential actions he may take to recover the money, as well as the cost of the proceedings.

Author: Gustavo Calero Monereo, C&D Solicitors (Lawyers)

Torrox-Costa (Malaga/Costa del Sol/Nerja/Andalucia)

NIEUW REGISTER VERHUUR VAKANTIEWONINGEN ANDALUSIË

NEW REGISTRY HOLIDAY HOMES ANDALUSIA

Geschrieben von admin am 9 März, 2016. Veröffentlicht in Unkategorisiert.

Registration tourist homes in Andalusia — New registry holiday homes Andalusia

A new decree (28/2012, of 2nd of February) about homes for tourist purposes in Andalusia, will enter into force on 12 May 2016. The aim of this decree is to regulate the large market of homes belonging to individuals and let by them as a holiday accommodation at different periods throughout the year.

These lettings, by days or weeks, as well as the use and terms of the lease, were not regulated until now. Therefore, the purpose of this Decree is to ensure that these homes meet a series of minimum requirements to be let, establishing the rights and obligations of both owners and customers and requiring the registration of the homes.

Clearly, this Decree has a significant impact in Andalusia, especially in Costa del Sol and Axarquía, for touristic cities like Granada, Malaga, Seville, and municipalities such as Nerja, Malaga, Torrox, Fuengirola, Marbella, Mijas, etc., which have many homes used for rentals of this type.

What is a home for tourist purposes?

These are homes located on residential land, offered in exchange for a price for the accommodation of people on a regular basis and with tourist purposes. Homes are understood to be let on a regular basis for tourist purposes if they are marketed or promoted in a tourist marketing channel. E.g.: Airbnb, Tripadvisor, Windu, property agencies, etc.

If you are the owner of a home on residential land in Andalusia and, during the year, you offer it for letting for days or weeks, this home will have tourist purposes. Therefore you must comply with the regulations of this Decree if you wish to continue to engage in this activity legally.

Which homes are excluded from this regulation?

Rural homes (houses in the country side) offered for holiday letting are not regulated by this decree. However, they do have the obligation of registering as a tourist home in the rural environment (Vivienda de Turismo en el Medio Rural). Therefore the owners of these homes must also register them before the Government of Andalusia but under a different regulation.

Homes let by the same person for two consecutive months or longer are not considered holiday homes and, therefore, do not need to register. This refers to homes let under a lease agreement for a period exceeding 2 months.

If, during the year, you let your home for over 2 months but you also let it for days or weeks, you will have to register it. Lettings exceeding 2 months and lettings for days or weeks are compatible in the same home.

An exemption to the application of this Decree is established when a single person has 3 or more homes for holiday lettings, within a radius of approximately 1 km. In this case, this Decree will not be applicable and regulations on tourist apartments will apply.

What does this Decree entail?

The obligation to register any home on urban land that the owner whishes to use for holiday letting before the Registry of Tourism in Andalusia. Once the home is registered, a registration number will be issued that must be displayed when offered for letting. The home only needs to be registered once and the registration number can be used for subsequent letting. The owner is the one legally responsible for registering the home and this home can´t be used for holiday letting unless it is registered before the Government of Andalusia by 12 May this year.

What are the registration requirements?

The home must be on residential (urban) land.
It must have a Licence of First Occupation. If it does not have the initial occupation permit, a certificate from the City Hall showing the location and use of the home should be accepted, but we are waiting for the written confirmation of the Junta of Andalusia.
Depending on the season, all accomadations need to be equipped with cooling and heating. In this case, the period for the owner lacking these installations is extended until 12 May 2017 and the property may be let during that period.
The home must have the essential furniture and furnishings required for the total amount of persons it is rented out to.
A first-aid kit is required.
It must have tourist information about the area, showing places to visit, restaurants, etc. A small tourist guide or advertisement from the corresponding tourist office can help you meet this requirement.
It must have complaint and claim forms available to customers in a visible place.
The home must be cleaned upon the check-in of new customers.
Linen and tableware appropriate for the number of people.
Contact telephone number to handle problems and emergencies.
Information and instructions about the appliances/equipment in the home must be available in a specific place.
Information must be provided about internal rules for the use of facilities, according to the regulations of the Residents‘ Association (community rules).
The maximum amount of people allowed in the property is 15.
In case you are renting out a room, instead of the entire house, the maximum amount of people allowed per room is 4.
All bedrooms must have external ventilation through windows.

What are the obligations for each customer?

A contract document must be signed by all parties, showing the details of the property, the owner, the number of days of stay and the price of accommodation, as well as the identification of people with a copy of their passports or residence cards. We are talking about a simple document of just 1 or 2 sheets, that the owner must keep for a period of 1 year.

Likewise, the owner must notify the Guardia Civil (police) of the occupation of the home with each new customer. The owner must provide a copy of the contract and the passports/identity cards of occupants.

What happens if I don’t register my home in this registry?

Inspection services may review the situation and begin penalty proceedings. Be careful, because the fine may range from 2,000 to 18,000 Euros.

Furthermore, you have the obligation to allow inspectors to enter the home when they visit it to verify that it meets the requirements for letting. If you do not allow inspectors to enter the home, you could be fined for very serious misconduct, with a large penalty.

What else does this Decree regulate?

Among other things, it regulates the rights of customers in cases where there is a conflict with the owner regarding the price of the letting, check-in and check-out times, advance payments or deposits for letting, etc. Ultimately, it regulates the terms for prices, booking, advance payments and cancellation, unless otherwise agreed in writing between the parties.

Taxes on income received

This registry is of an administrative nature, dependent on the Government of Andalusia and created to regulate the conditions of holiday lettings. It has nothing to do with the obligation to pay taxes on rental income. Likewise, if your home is registered in this Registry but you do not rent it out, it will have no cost to you.

The payment received for letting a home -either for holidays or long-term (longer than 2 months)- must be declared before the Tax Agency, which depends on the Central Government. The income tax you pay depends on the fact wheter you are a fiscal tax-resident in Spain (IRPF tax) of not (IRNR tax).

Legal advice

Even though the Decree will enter into force on 12 May, it is already possible to start the process to register homes in this Registry. If you have one or several properties being let as holiday homes you must register them before the Government of Andalusia. We can take care of processing the documents you need to register your home. We can also inform you about all the requirements that your home must meet and your obligations as its owner. Don’t hesitate to contact us at 0034 – 952 532 582 or info@cdsolicitors.com

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Nerja/Andalucia)

VONNIS: Bank verantwoordelijk bij ontbreken bankgarantie ontwikkelaar

JUDGEMENT: Bank responsible for bank guarantee developer

Geschrieben von admin am 16 Februar, 2016. Veröffentlicht in costa del sol, english speaking solicitor.

Bank responsible for guarantee developer

In September 2013 I published an article where I mentioned a judgment rendered by a Court in Albacete on the 8th of June 2012 and that was confirmed by the Provincial Court in the same year. In these proceedings forty-six homebuyers who purchased off-plan houses that were never built -but for which they had made several payments on account- sued the developer and the bank jointly, despite not having bank guarantees for the amounts paid.

As I mentioned in that article this judgment (a first at the time) ordered the bank to refund all the amounts paid by the buyers. It thereby established joint and several liability with the developer of the homes through an interpretation of articles 1 and 2 of Law 57/1968, of 27 July 1968 on the collection of advance payments in the construction and sale of homes.

This however was just an isolated judgment, which did not set precedent. In fact, in the two years since, there have been judgments both in favour and against banks.

These different interpretations have come to an end as, on 21 December 2015, due to the many contradictory judgments the Supreme Court rendered an appeal judgment on this matter. This judgment of the Spanish High Court unifies the criteria to prevent different interpretations by other courts. The Supreme Court is certain about the interpretation of these regulations and ruled in favour of individual homebuyers.

The High Court understands that the credit institutions where homebuyers deposit advance payments to purchase a home under construction, must respond to homebuyers. This refers to cases where the homes are not completed by the developer and the latter has no money or is insolvent, making it impossible for homebuyers to recover any money paid.

In the Fifth Legal Grounds, the last paragraph of the judgment, the Court states that the credit institution has the legal responsibility of a special duty of oversight over the developer to which it issues a loan for the construction of those homes, so that the deposits of homebuyers, especially individuals, are transferred to the special account that developers must open and the bank must require the developer to guarantee all the amounts it collects.

Credit institutions that grant loans to developers to build homes, have the legal obligation of opening a special and separate account, duly guaranteed, so that the amounts that buyers pay for the homes are deposited in that account. If the credit institution does not guarantee that buyers‘ money is deposited in a special account, it will be held liable for the total amounts deposited by buyers in any type of account held by the developer at the entity.

In other words, if the bank has not ensured the protection of the buyers‘ money, with this Judgment, there is no longer any legal doubt that the bank will be sentenced to refund, from its own “pocket”, the money paid by homebuyers in cases where the developer does not complete homes and it has no money or becomes insolvent.

In my humble opinion, it seems logical and consistent for the Supreme Court to have settled this matter in favour of homebuyers.

In banking practice, most developers building homes off-plan create a company aimed exclusively at building that development, with these companies usually being devoid of any assets.

From now own, I believe that these loans issued to developers will only be granted after reviewing the solvency and guarantees of the developers thoroughly and that branks will monitor the money that buyers pay for their homes.

In these situations, with this judgment by the Spanish High Court, buyers of homes that are not completed will have the necessary legal certainty to get, through a Judgment, banks to be ordered to refund their money, thereby having more options available to recover the money they lost.

It is very likely that, if this situation arises, now, with this judgment, the bank will choose to avoid legal proceedings and reach a settlement with buyers.

Author: Gustavo Calero Monereo, C&D Solicitors (lawyers)
Torrox-Costa (Malaga/Costa del Sol/Nerja/Andalucia)