An eight-year-old house will be up to 50% more expensive to sell in 2023

Specifically, selling a previously acquired property in 2023 Between 2009 and 2019 It will force you to pay more in council tax on capital gains. In the case of a home acquired in 2015, the decision to sell it in 2023 (age eight) instead of doing it in 2022 (by seven) could mean paying up to 25% more in municipal capital gains tax according to: from the new coefficients

How does capital gains tax work?

Local capital gains tax is a tax that the seller of a property must pay in the municipality where the property is located. when it comes inheritance or donation, Who should pay the tax, who gets the property. What is taken from this tribute, increase in land value of an urban nature (no, rustic ones) evident throughout (not construction) a period of 20 years when there is any transfer of property: sale, barter, donation, inheritance, judicial auction, forced expropriation. In November 2021 the Government had to change the design of this council tax after the Constitutional Court annulled the Tax Code. Increase in the Value of Urban Nature Land (IIVTNU) – the full name of the tax – will be effective from October 26. The Constitutional Court, for example, annulled the tax because it leads to the existence of surplus value (the increase in value between the initial price and the transmission price), even if the sale suffers a loss.

To address this legal issue, the Treasury approved a reform in November 2021, with a decree bidding on the taxpayer. two calculation alternatives Benefit from tax so you can choose the least burdensome and avoid paying taxes in the event of a disability. first option, ‘objective method’ or ‘objective capital gain’: In this case, the tax base will be the result of multiplying the cadastral value with the new discounting coefficients, which must be updated annually in the State Budget Law and take into account the weather reality of the real estate market. . It will be applied over the base calculated in this way. tax rate determined by each municipality to determine the fee to be paid within legal limits. If the second option is ‘true surplus value method’: In this case, the tax base will be determined according to the difference between the sale price of the part of the real estate related to the land (not the building or flight) and the acquisition price. About this tax base The tax rate determined by each municipality will be applied to determine fee payable.

What are the consequences of the change in the Budget Law?

Thus, the municipal tax on capital gains can be calculated by multiplying the cadastral value of the land (construction number,) on which the property is located, by a reduction coefficient determined in the Budget Law every year. According to the newspaper, these coefficients for 2023 ExpansionIt ranges from 0.45 (if the property was bought 20 years ago) to 0.09 (if the property was bought 11, 12, 13 or 14 years ago). In some cases, the coefficients straightened up (especially those affecting antiquities 13 to 5 years old). In others, down.

Especially for a property purchased 8 years ago The coefficient increased from 0.1 in 2022 to 0.15 in 2023. a sharp increase of 50%. The truth is that the house, which will be 8 years old in 2023, has a shortage in 2022. The bottom line: A house bought in 2015 and sold in 2022 at the age of seven will be taxed under one coefficient. 0, 12 points. If the sale is delayed to 2023, the coefficient will be 0.15 points and the municipal taxation will be 25% higher.

set an example, from a house bought in 2015 for 310,000 euros. If that house is sold for 350,000 euros, the seller makes a profit of 40,000 euros, but in this example the ‘real capital gain’ corresponding to the value of the land is 24,000 euros.

If the sale takes place in 2022 (if the property is seven years old), the taxable base for the tax will be the result of this 24,000 euros multiplied by one figure. 0.12 point reduction coefficientThis gives a result of 2,880 Euros.

If the sale takes place in 2023 (which will already be eight years old and with the increase foreseen in the Budget Law), the tax base will be the result of these 24,000 euros multiplied by a coefficient of 0.15 points. this gives a result of 3,600 Euros. dir-dir tax base 3,600 euros is 25% higher than would result from selling the same property in 2022 (2,880 euros).

In any case, it should be noted that the tax rate must be applied to this taxable base. tax rate determined by each municipality.

According to which criteria does the Ministry of Finance update the coefficients?

Updating coefficients, as explained by Minister María Jesús Montero’s chapter “neither up nor down can be made a prioriThey explain that the determination of the amounts of the proposed new coefficients is done “objectively”, taking into account the observed average value increases at the national level. The “actually performed transactions” each year are taken as baseline data.