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Complementary Tax

Potential Complementary Tax Settlements

Article from a Lawyer in Marbella Spain, Mr. Félix Ruiz

If you are a purchaser of a property in Spain and agree to a certain price with the vendor, you may receive from the corresponding Spanish Tax Office a “Complementary settlement”, once signed the Purchase and Sale Title Deed. Regional and National Inland Revenue may claim the settlement of the tax according to criteria established by law inSpain. The tax authority is empowered to review the values set by the parties freely.


In Andalucía, the Order of February 13, 2013approves the coefficients applicable to the cadastral values (rateable value) to estimate the real value of properties in order to settle additional bill´s with regards to the transfer tax and stamp duty, inheritance and gift tax inSpainand or the well know Capital Gain Tax. This Spanish law establishes the rules for applying them and the methodology used to obtain valuations on properties in Spain.

Imagine, you as purchaser of an already existing not newly built property in Spain, agree with the vendor a certain purchase price. This price is freely agreed by both parties that for all purposes is a market price, however you need to keep in mind that if that price is lower than that established by the regional law – the so-called tax/fiscal value -, you, the purchaser, will receive in a relatively short time since the signing of the Purchase and Sale Title Deed a “complementary settlement” claiming the difference in transfer tax originally paid, plus legal interest (and remote fines).

Take a practical example that allows you to understand the above:


Purchaser and vendor agree on a price of 100.000,00 euros for an urban property in the Andalusian municipally of Cuevas de Almanzora.

The rateable value of the property in the municipality is 45.000 euros and the multiplier applicable to this town for the year 2013 is 3,60. We find that the fiscal value of this property is of 162.000,00 euros, (45,000 x 3,60).

At the time of the signing of the purchase Title Deed, the Purchaser has paid the transfer tax to 8% over 100,000 euros = transfer tax liability of € 8,000.

Well, please be ensured that the Tax Office of the municipality of Cuevas de Almanzora, will send a “complementary settlement” requiring payment of the transfer tax on a total value of 162,000.00 euros, with a tax to be paid of 12,960 euros, discounting the initially tax of 8,000 euros, plus interest applicable.

The above would also be applicable to Inheritance and Gift Tax in Spain as well as the well known Capital gain tax in Spain.


Before proceeding with the purchase of a property and agree a price with the vendor, keep in mind that there are a number of values that may affect the taxes of the transaction. Do not hesitate to contact the leading multi-lingual law firm,Arcos & Lamers Asociados for any tax or legal matter in Spain.


Please do not hesitate to contact the English speaking Spanish lawyers and accountants in Marbella of Arcos & Lamers Asociados, your property lawyers in Spain and tax advisors in Marbella, in the event that you need professional advice regarding the matter proposed in this blog or any other that you may have at the time of selling or purchasing your property in Spain, we have an expert team ready to answer your questions and to provide legal and fiscal advice in Spain.

Arcos & Lamers Asociados, property lawyers in Spain, property lawyers in Marbella, property law firm in Spain, conveyancing lawyers in Spain, Spanish legal advisers. Approach the English speaking Spanish Lawyers of Arcos & Lamers Asociados for any legal, tax, labour and company advice you may need!.

Félix Ruiz, Lawyer in Marbella. Marbella, June, 2013.