Tenerife Property

Owners in Tenerife need to hurry to reclaim tax

Expats who paid out too much tax on their Spanish property sale may be entitled to a rebate amounting to thousands of euros.

The potential capital gains windfall for British expats who sold property in Spain before 2007 comes after the scrapping of a discriminatory Spanish tax law.

The  pound   is now  weak against the euro, and the clock ticking on  refunds, all claims must be filed by 21^st November this year. With a weakening pound and a steady euro, this welcome tax refund can be maximised by British expats who can make a claim and exchange their money as soon as possible. When yearly interest is taken into consideration on property sold as long ago as 1997,  considerable sums of money can be returned and saved.

It will be great for expats to get their cash back, but even better if they can use the current exchange rate to their advantage and get the most from their unexpected windfall.

Capital gains tax paid by British expats who sold Spanish property before 31^st December 2006 was charged at a ‘non-residents’ rate of 35 per cent, compared to just 15 per cent for Spanish residents.

The Spanish government changed the law in 2007, after the EU declared it discriminatory, but an estimated ten thousand British expats had already overpaid. Now they are entitled to a refund.

The claims deadline for those who sold property between 1^st Jan 1997 and 31^st December 2006 has been set for 21^st November 2010, under a one year statute of limitation.

Dimas Cuesta from Lexland, a law firm that has already secured rebates for British expats, added: “The legal process requires expert advice, which is fundamentally important to the chances of a successful claim. British expats looking to be reimbursed should act now, before the claims deadline.” Expats who think they have paid too much tax on their Spanish property sale should  see how much they may be owed as soon as possible.