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Documents that must be available before buying a home

When buying a home, it is important to know the documents that have to be in order, to avoid unpleasant surprises. As a starting point, you should know that these documents vary depending on whether the floor is new, second-hand or if it is under construction.

- Apartment of new construction:

A new floor for sale must have several legal documents in order before signing the contract. The end-of-building certificate, issued by the technician or developer, declares conformity with the execution of the construction work. For its part, the certificate of habitability and the certificate of energy efficiency, issued by an architect or surveyor and ensures that housing has passed the mandatory quality controls. Having this document is a necessary condition for, for example, discharging light, water and gas services.

Other documents are the license of first occupation and the obligatory guarantee. In the case of new buildings, it is mandatory that they include a ten-year insurance that responds to possible defects and defects in the structure. Finally, it is advisable to request the works permit to see that the apartment meets the conditions set out in it.

- Second hand floor:

If the option is to buy a used or refurbished apartment, it is advisable to have the title of the property and the certificate of dominion and loads, as well as the flat of the house at 1/50 scale. In the case of second-hand housing, the certificate of habitability and the certificate of energy efficiency, is important because it confirms that the property meets the minimum requirements to be able to be inhabited. In addition, it should be remembered that this document expires 15 years after its issuance, so it must be verified that it is current and in force.

Also, the seller is obliged to supply other documents if requested. This is the case of bulletins in the network of services, housing guarantees, registration data of the floor or deed of sale, and the receipt confirming the payment of the last IBI. In this last document must appear the cadastral value of the property.

If there are doubts, such as in the case of real estate located in non-urban areas or near the coast, it is important to request the urban qualification to verify its legality. Another document is the building book, which includes the identification and construction data of the building, the maintenance tasks to which it has been subjected and, if they have occurred, the reforms carried out.

Floor plan:

In the case of buying a property on plane, it is essential to verify that the amounts delivered to the seller are backed by an endorsement or insurance policy. Thus, if the agreed conditions are breached or the work is not completed, the seller will recover his money.

However, before delivering any amount of money, it is important to verify that the building has a municipal works permit, that the contract provides for the completion period of works and the date of delivery of keys (including a penalty in case of delay), And the total price of housing (plus taxes).

As for the payment methods, you have to request a document that includes the existence or not of mortgages, the subrogation and the cancellation of these. Finally, attached to the purchase contract must include the floor plan, the sketch of light, water and gas installations, the list of professionals that are expected to intervene in the work, and the quality report. If the seller breaches the contract, the buyer is entitled to claim and even request the termination of the contract, with the return of the quantities already paid.

24 Jul 2017

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What expenses does the sale of a home involve? II

The derivatives of a mortgage loan to finance the construction, in a new work.Those attributable to the writing of new work and horizontal division of the new building.
The tax on the increase of the value of the land or the surplus value, in all the cases.
The derivatives of the intervention of a real estate agent, in all cases.
The connection of access to general supplies.
Derivatives of obtaining the documents to be delivered to the buyer.
Obligation to make the declaration of income the following year.
Pay IBI for the entire fiscal year in which the sale takes place.
Unless otherwise agreed, the tax on the increase in the value of urban land (municipal capital gains) is borne by the seller.

Usage: As a consequence of the transfer of ownership of a property or of the constitution or transfer of real property rights (for example a usufruct), the tax has to be paid on the increase in the value of urban land, Also known as surplus value.

In the case of sale of a property (floor, parking space, store, shop, house, etc.) the person, company or entity that sells has to pay the tax due to the increase in the value of the land while Owned. If the transmitter or seller is a non-resident natural person in Spain, the obligor to the payment will be the acquirer.

In the case of inheritance or donation, it is the new owner who has to pay the tax, with bonuses up to 95% in Barcelona by kinship and VHF.

Payment must be made within 30 business days from the date of transmission. In the case of inheritances, the term is six months from the date of death.

La cuota a pagar está en función del valor del terreno en el momento de la transmisión y de los años que el transmisor ha sido propietario de este (se calculan como máximo veinte años). Para determinar el importe, se multiplica el valor del terreno por el número de años que se ha tenido la propiedad y por el porcentaje anual en el caso de Barcelona, el resultado se aplica el tipo impositivo, que es del 30%. Cuando el período es inferior a un año, se aplica el porcentaje del 4% anual en función de los meses completos, con excepción de las herencias en las que sólo se consideran años completos.

Declare the sale on the IRPF declaration: (if they reside in Spanish territory)

If the purchase price exceeds the sale price, there will be a capital gain that is taxed in the IRPF. It should be noted that the purchase price includes taxes paid on the purchase and improvements made in the property. The sales tax also includes the taxes derived from the sale. Obviously, if the sale price is lower than the acquisition price, it is considered that there has been an equity loss. The calculation of surplus value is made exactly as in 2015, the purchase price is updated by a coefficient and a tax rate is applied:

From 0 to 6,000.- € 19%

From 50,000.- € the 23%

From 6,000 to 50,000.- € 21%

It is not necessary to state:

The sale of the habitual residence by people over 65 is exempt from taxation.
The sale of the habitual residence by the under 65s is exempt from taxation (totally or partially) if within two years (before or after) the amount is reinvested in the purchase of a new habitual residence, not second residence. That yes, the exemption only applies on the part of the profit that is destined to buy another house. The one that is not used should tax.
The sale of housing, other than a regular home, may only be exempt if the person who sells it is over 65 years old and hires an annuity (with a maximum amount of 240,000 euros of sale price).
If the sale generates a loss of equity to the seller. Selling a house is associated with several expenses and if the sale price is lower than the acquisition price and, therefore, it causes a loss instead of an equity gain, it should not be taxed. Moreover, the handicap can be offset by gains made during the next four years.

The equity gain or loss is determined by the difference between the acquisition and transmission values of the equity items:

The acquisition value is determined by the sum of three concepts and the subtraction of a quarter:

Actual amount of the acquisition. When the acquisition of the item that is now transmitted has occurred for consideration, its acquisition value will be the actual amount for which it was acquired.
Cost of investments and improvements. If investments and improvements have been made in the purchased items, their cost is added to the acquisition value.
Expenses and accessory taxes. All the expenses and taxes inherent to the acquisition that have been satisfied by the acquirer, except for interest, are added to the calculation of the acquisition cost amount.
Amortization. The amortizations that correspond to amortizable assets reduce the acquisition value.

2.The transfer value is determined by computing two items, the actual amount of the alienation minus the expenses and taxes inherent to the transmission that have been satisfied by the seller.

And so far our chapter of Expenses in the purchase of a home! Contact us if you have any questions.

13 Jun 2017

What are the costs of buying a home? I

When making a decision to buy a home, it is important to bear in mind that not only do you have to pay the price of the property, but also have to pay a series of compulsory expenses, whether with or without mortgage, there are costs " Additional "that must be taken into account so that there are no surprises.

If the purchase is to be made through a mortgage loan, a series of independent expenses are generated:

The appraisal of housing: an independent expert will do an appraisal of the property for the financial institution. Normally the certification will not be valid to apply for the loan in another entity.
Check in the Property Registry: it is for the bank to have the assurance that the house is free of charges before granting the mortgage.

Based on this assessment (300-400.- €) will know the possible buyer if you can make the purchase or not since normally the banks give 80% of the lowest price between the purchase and said valuation, so it is very important Be clear the amounts to be paid.

The costs borne by the buyer are:

The purchase price of the home.
The expenses of writing mortgage credit, if any.
VAT, 10% of the cost of housing if it is a new work or the tax on property transfers if it is a second hand home (Catalonia is 10%).
The minutes of the notary to whom the public deed of sale is granted, unless it is agreed to pay it half-way with the seller.
The expenses of the registration in the Property Registry and the expenses of said management, if done by a third party, unless it is agreed to pay it half with the seller.
If a mortgage loan is requested, the loan opening expenses.
Property fees if the purchase is made through this.
The expenses of discharge and / or change of the holder of the services of water, electricity, gas, etc.
The insurance, as a minimum, of the risks arising from fortuitous causes, force majeure and damages to third parties.

Description of expenses:

Notary: the notary's fees when writing the sale and if there is a mortgage, deed of mortgage loan, subrogation in a pre-existing mortgage, etc .... These fees are regulated by the administration and depend on the price of the property.-Taxes imposed on the sale: there are two different taxes depending on whether the house is new or second hand.
Taxes levied on the sale: there are two different taxes depending on whether the house is new or second-hand.
New housing (first transmission): the tax levied on this property is VAT (value added tax), the amount is calculated by applying a percentage over the book value. This percentage is 10% in free housing or official protection, and 4% in housing classified as special regime official protection.

In general, and whenever the sale of a home is subject to VAT, the AJD (Tax of Documented Legal Acts) must also be paid. The type to apply varies depending on the autonomous community of residence and the type of document. In Catalonia at the moment it is the 1.5% and in the protected houses is of 0.1%.

When a mortgage is constituted, the Tax of documented legal acts (AJD), which represents 1% of the guaranteed capital, must be settled.

Second-hand housing or subsequent transmissions: the tax levied on this type of property is the ITP (Regional Tax on Transfer of Assets) and varies depending on the autonomous community, ranges from 5% to 10% of the price. There are bonuses / reductions in VPO.

Remember that Hacienda can claim a higher payment to the buyer if it considers that the home is worth more than what has been paid for it. Each CCAA has a minimum price table and on them the minimum value of each property is calculated in 2017. For example in Barcelona is the cadastral value X 2,20 = Minimum value. In some CCAA there are bonuses for large families, disabled and / or young people in Catalonia is 5%.

When a mortgage is constituted, the Tax of documented legal acts (AJD), which represents 1% of the guaranteed capital, must be settled.

Minutes of property registration: the deed of sale of the property must be entered in the property register and if there is a mortgage, it is also entered as a charge on the property. These rates are officially regulated and are applied by calculating the taxable amount of the property and / or loan.
Expenses of management: these are the fees of the manager to carry out all the necessary procedures for the liquidation of taxes and the registration in the Property Registry. The rates of the managers are not fixed and, therefore, it is advisable to know if the agency that carries the documentation offers reasonable prices.
Expenses of discharge and / or change of the holder of water, electricity, gas, etc. services.
Insurance:

Insurance coverage is mandatory by law on housing in case of a mortgage loan. Covers only the continent (the structure). In case of total loss of the property, the insurer will settle the outstanding debt to the financial institution and the rest until the amount covered will be delivered to the insured.
Multi-risk housing insurance: includes both the continent and the content (from appliances, jewelry and furniture to civil liability to third parties).
Life insurance or loan repayment: covers the contingencies of death, absolute disability and permanent disability. Normally does not cover partial disability.

Usually the sum of these expenses is around 10 or 15% of the value of the house.

13 Jun 2017

The obligation to file a claim with the insurer

As the retroactive nature of the procedural rules is not acceptable, the Audiencia Provincial de Girona has agreed to indicate that the obligation to submit a prior claim against the insurer, as a requirement for the admission of the claim established in art. 7 of Royal Legislative Decree 8/2004, in the wording given by Law 35/2015 of 22 September, is only applicable to traffic accidents occurring as of January 1, 2016.

In this way the AP of Girona considers the appeal filed by the plaintiff, revokes the order of the court that rejected the application for compensation claim for damages suffered as a result of a traffic accident occurred on April 29, 2015, For not accompanying the claim documents supporting the submission of the prior claim to the insurer.

The Court points out that the new legal regime is not limited to increasing the compensation amounts, but rather establishes a general regulation that aims to improve the protection of victims of traffic accidents, and in that line is framed the aforementioned art. 7 when it establishes that the prior claim to the insurer not only interrupts the limitation period, but also suspends it until notice is given to the injured party of the motivated offer or response.

The Audiencia considers that the procedural nature of this rule obliges to take into account the provisions of art. 2 LEC in the sense that the procedural rules will never be retroactive, as well as the provision in the transitional provision 4th CC, under which, in a case like this one, the plaintiff can choose between the previous or current rule . It also emphasizes that the inadmissibility of the claim would have a dramatic effect on effective judicial protection (Article 24 EC).

Consequently, it concludes that it does not make sense to require, when the accident to which the claim relates had occurred before January 1, 2016, that the claim be accompanied by the prior claim and that because the claim was not mandatory when the accident happened Nor, if it had been carried out, would have caused the victim to have the positive effects (interruption and suspension of the prescription) that derives from the norm that imposes it.

More information on the Judgment of the AP of Girona in "Legal News" --> Ver enlace

19 May 2017

We found the best house for you

BCN TRADIS is the real estate agent with the most personal treatment. Because we believe that each client deserves a personalized treatment to the maximum, we offer you the best options for you according to your needs taking into account all the variables. With BCN TRADIS you make sure to find the perfect property, look for what you are looking for.

And if you have a property that you want to sell or rent, contact us and we will look for the perfect buyer or lessee. Because all the real estate has its half orange! We take care of everything so you do not worry about anything.

19 May 2017

Taxation of a business transfer

When dealing with a business transfer, you need to know all taxes associated with these types of contracts; And is that the price of the transfer could be affected. Another thing you should be clear about is that the taxes associated with business transfers are usually paid before starting the activity.

Regarding VAT, the operation of transferring business premises or transferring a business is regulated in:

-Article 7.1.a) of the LIVA: the transfer of a set of corporative and, where appropriate, incorporeal elements that form part of the corporate or professional property, will not be subject to VAT, provided that it includes the transfer of a commercial establishment Or of an autonomous part of a company with bodily elements and, where appropriate, incorporating them, jointly constitute a company or a part of a company capable of developing an autonomous economic activity, ie does not include the mere transfer of goods, Sale of stocks, or the sale of the business separately, in addition it should be noted that it is not necessary for the acquirer to carry out the same activity as the transferor.

However, even if the transfer of business premises or the transfer of a business is not subject to VAT, the transferor must issue an invoice without VAT, for the amount paid for the transfer or assignment of the business.

However, this is not the case, in the case of the owner of the premises, when he receives a part of the transfer. In this case the owner will issue an invoice to the old tenant, for that amount plus 21% for VAT, minus the corresponding withholdings.

As for the income received by the former tenant for the transfer of the business premises or for the assignment of business, must declare and tax in the IRPF as equity gain, which will be calculated by deducting from the amount of the transfer the net value of the assets And rights delivered.

In the event that the former tenant is a company, this tax must be taxed in the Corporate Income Tax (IS).

The owner, in the case of receiving a part of the transfer, must register it as a return on the real estate capital in his personal income tax return, if he is a natural person, being able to apply a reduction of 40% when it is a rent obtained irregularly in time.

19 May 2017

What are the initial expenses to keep in mindwhen renting a property as habitual residence?

Renting implies a lower economic effort compared to buying a home, but it also requires a certain sum of savings to cover the initial expenses, which can amount to several thousand euros.

Renting gives you greater flexibility than buying,and requires less initial investment, however it means relinquishing to some rights too.

The financial costs involved in renting a property will vary on each individual case depending whether the owner asks for a guarantor, extra guarantees or payment of an insurance.

The following points are the most important:

First month’s payment

The first expense we will have after signing the rent contract is the payment of the first month.

Deposit

The purpose of the deposit is to cover any expenses that may occur due to tenant’s neglect of the property or unpaid rent. It is mandatory by law and is equivalent to the amount of one month’s rent. The landlord must put your deposit in a government-backed tenancy deposit scheme. Although the deposit can be recovered at the end of the tenancy period,you must make the down payment in advance.

Additional guarantees

The Spanish law for urban rent (LAU: Ley de Arrendamientos Urbanos) allows the landlord and the tenant to agree on the payment of any additional guarantees to ensure the observance of the tenant’s obligations. Some landlords require a down payment of several months’ rent on account of this additional guarantee.

Bank Guarantee

Sometimes landlords require the constitution of a bank guarantee by the tenant to prevent non-payment of rent. In many cases, when the financial institution considers that the tenant’s solvency is insufficient to "loan" the money that the collateral implies, it requests that this sum -which can be from six months to a year’s rent- is deposited in an account at the financial institution. While this money will also be recovered in time, it means having to supply a significant sum at the time of signing.

Agency fees

If the landlord has hired a state agent to find a tenant on their behalf, the fee charged by the agent will normally be paid by the tenant. This amount will be variable, but usually it is one month’s rent or 10% of the annuity plus the corresponding VAT.

Utility supplyactivation fees

When renting abrand-new property that has never been registered for utility supplies like water, electricity or gas, it must be agreed in the contract who pays the activation fee for these services. It is advisable to get this information about costs before signing the contract, as if you as a tenant must assume these costs, be aware that they can exceed 500 €.

Tax (ITP):

This tax is unknown by most tenants, but accordingly to current legislation it must be paid within a month of signing the contract. If it’s a habitual residence the tax is calculated at 0.5% of the total rent for 3 years’ contract.

Insurance

Some owners who fear to suffer loss, damage or unpaid rent in their property, decide to contract an insurance policy that covers these risks. In some cases, they also require that is the tenant who pays the insurance premium as an alternative or supplement to the guarantee or other guarantees. This is actually becoming increasingly popular as a clause in tenancy or lease agreements.

The move

Moving, whether you hire a professional company or you do it yourself, always involves an expense. For example, in cities like Madrid or Barcelona, hiring a removals company for moving the contents of an average flat will set you back around1,000 euros.

In conclusion, the initial expenses when renting a property as a regular residence will sum up to the amount corresponding to about four months’ rent: the current month, another corresponding to the deposit that the landlord will put at the government scheme, one as additional guarantee and finally the agency’s fee (if applicable). Remember that two of them, the deposit and the guarantee, are recovered at the end of the tenancy agreement. However, we must not forget the other concepts that have been previouslyexplained in the article.

08 Mar 2017