Spain is on cloud nine after winning two of the biggest sporting gongs in the world, but there is a rather more pressing matter for them to deal with - at least for the Brits who sold a property in Spain between 1997 and 2006 - who have just one month left to begin claiming back capital gains tax charged illegally on the sale of their home.
The Spanish Government illegally charged British people more than double the amount of Capital Gains Tax, (CGT) they owed on their properties between 1997 and 2006. The poor Brits who had chased the sun to Spain in search of sea and sangria were forking out a whopping 35 per cent under the ‘non-resident’s income tax’ bracket. Spanish nationals residing in similar homes were paying the proper rate - just 15 per cent of any capital gains. The overcharging is estimated to have raked in more than £350 million for the Spanish Government.
In 2009, following much outcry from British owners of Spanish properties and an expose by a group of Spanish lawyers and a UK based currency specialist, the European Court of Justice (ECJ) ruled that the tax contravened European Community Treaty rules against discrimination. They agreed that any UK or EU citizen who sold a property in Spain between 1 January 1997 and 31 December 2006 could claim back the excess charges.
Now, those affected by the illegal CGT charges have just a month left to make their claim or face losing out on the chance to get back what is rightfully theirs. All claims must be finalised and settled by the end of October this year - as August is considered to be a holiday month in Spain, sellers have just one month left to kick off their claims, which can take up to three months to be realised.
The average amount of money being recovered is around £15,000, so it is more than worth checking if you are eligible for a refund. More than 500 British families have already been successful with their claims.
Even if you have tried previously to recoup the money and not been successful, lawyers are saying that a second try is most definitely worthwhile as some of the rules governing eligibility have changed - indeed, the European Court of Justice have recently opened new legal actions allowing claimants to make a second attempt. The industry estimates that there are still thousands of Brits who sold Spanish properties during the eligible time period who haven’t come forward. So if you bought a property in Tenerife, the Canary Islands, or mainland Spain, get that claim in pronto!
