Could you be in line for a Spanish capital gains tax rebate?

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According to an article in the latest issue of Lloyds TSB International magazine ‘Shoreline’, British expats who sold a property in Spain before the end of 2006 could be due a Capital Gains Tax rebate following a landmark court ruling.

Hola,

According to an article in the latest issue of Lloyds TSB International magazine ‘Shoreline’, British expats who sold a property in Spain before the end of 2006 could be due a Capital Gains Tax rebate following a landmark court ruling.

The magzine article explains that after a year-long legal dispute with Spanish tax authorities, a British couple was recently awarded £10,000 after Spanish courts ruled that they had been unfairly made to pay a higher level of Capital Gains Tax on their property sale than they would have done if they were Spanish.

According to the piece, until the end of 2006 with Capital Gains Tax running at a rate of 35% on any gains made on the property, non-Spanish residents were required to pay more than double the amount Spanish nationals were.

Currency experts HiFX calculated that between 2002 and 2006, the average British owner selling a property in Spain paid a Capital Gains Tax bill of £14,000, compared with only £6,000 paid by Spanish sellers.

At the beginning of 2007, the European government contested those rules on the grounds that they were  discriminatory and managed to get them abolished.

The legal case involving the British couple has now paved the way for further claims by expats unfairly charged at the higher rate.

Legal sources estimate that there are already over 600 further claims imminent, with potentially thousands more eligible to make a case for a rebate.

That said, under Spanish law, claims can only be made if the tax bill being contested was paid in the past four years, so if you think it affects you, you better get some legal advice quick.

Hasta luego!

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