Blog Post PLUSVALIA tax modificacion 2018

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PLUSVALIA tax modificacion 2018blog image

The modification of “plusvalía tax” is going  ahead and the process begins in  parliament,  even though it is over a year after the government has presented the bill !!      Not only will it cancel the payment of a tax when  a property  has sold “at a loss”, but also it will be modify the rate that it is established by every town hall.

Indeed, the bill has considerably reduced the rates for the relief of the contributors.    However the popular parliament group has initiated the proceeding of the bill that slightly increases the rates. Although even with this increase,  rates are continuing to be below the actual law.

At the end of July 2017, the government approved the bill looking to modify the local tax office regulatory law to eliminate the “plusvalía” town hall payment when a house makes a loss.    

At the beginning,   the bill modified the coefficients that are put on over the cadastral value of the land and also the way to calculate it.   Previously,  the coefficient has been calculated by 5 years periods, now the calculation is annual, with a maximum of 20 years. However, the maximum coefficients have been slightly risen by the bill as it is showed at the following table:

Plusvalia Coefficient has been changed as the following table shows:

How your pocket will be affected?

The best is to see how the taxpayer pocket will be affected with examples:

Calculate example with the actual Local Tax Office Regulation Law:

Cadastral Value: 40.000 euros

Generation period: 6 years

Coefficient article 107: 3,5

Tax base: 8.400 euros (40.000 x 21%*)

*6 years x 3,5

Calculate example with the actual Local Tax Office Regulation Law (July 2017):

Cadastral Value: 40.000 euros

Generation period: 6 años

Bill Coefficient: 0,06

Tax base: 2.400 euros (40.000 x 0,06)

Calculate example with the actual Local Tax Office Regulation Law (March 2018):

Cadastral Value: 40.000 euros

Generation period: 6 años

Bill Coefficient: 0,08

Tax Base: 3.200 euros (40.000 x 0,08)

In addition, the bill added a new transitory regulation, to adapt to the fiscal regulations  of every town hall to accept the new law with the following conditions:

Period of 4 months from the effective date of the law to adapt the new town hall  conditions.

Until the new regulations, maximum coefficient provided by law will be implemented.    In the case that the old coefficients (not modified yet) would be more advantageous.    In that case the ordinance coefficients will be implemented until the ordinance is modified.

Other news that turn up with the law  

The principal new is the tax legal reform will not be demanded when the contributor has transmitted a property as a loss on the escritura values.

To know if there is an increase of the value of the land or not, José María Salcedo lawyer,  Ático Jurídico, reminds us  to consider transmission and acquisition,   which will be the ones paid and documented in the deed.    With the exception that values have been verified and the results would have been superior. Thus, in the purchase of a house, the reference value is the price that appears in the deed of purchase of the property.

If the transmission is gratuitous (inheritances and donations), it will be consider the values of acquisitions and transmissions declared in the successions and donations. As in the previous case, if that values have been object of verification and the result is more than the one declared, the administrative valuation will be considered

Efficiency retrospective of the reform

The bill expects the law effective date,  after it has been approved, would be the day after to the BOE publication, according to José María Salcedo.    However, some of the measures planned will be retrospective to the effective date.

In the event of the new has not subjected to the tax when it is sold at a loss.   The effective date of this measure will be 15-06-2017, as it has been published in 11-05-2017 sentence BOE of constitutional tribunal. Therefore, from the  date 15-06-2017, it will consider it to be not related to all lands transmission taxes when the value has not been increased.


  Tue 27th Mar 2018
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