The municipal capital gains tax is a tax that levies the increase in value in the sale of urban land, within municipal jurisdiction, and its payment is the responsibility of the seller
The municipal capital gains tax is a tax that levies the increase in value that an urban land has experienced at the time of being sold. This tax is the exclusive competence of municipalities and its purpose is to tax the wealth generated by the transfer of real estate.
In general terms, the municipal capital gains tax is calculated based on the cadastral value of the land and applying a percentage that varies depending on the municipality where the property is located. It is important to note that, unlike other taxes such as VAT or income tax, the municipal capital gains tax is paid regardless of whether or not a profit has been obtained from the sale of the land.
Regarding who should pay the municipal capital gains tax, the regulations establish that it is the seller's responsibility to pay this tax. However, in practice, it is common for both parties to reach an agreement to split the payment of the capital gains tax proportionally to the benefit obtained from the transfer of the property.
In Spain, there are different court rulings on the municipal capital gains tax that have generated some controversy in recent years. In this sense, the Constitutional Court has established that the tax on the increase in the value of urban land is unconstitutional in those cases where there has been a loss of value of the land or no profit has been obtained from the sale of the property.
To avoid problems with the municipal capital gains tax, it is important to take into account certain tips. For example, it is essential to keep all documents related to the purchase and sale of the land, as these may be useful in case of having to demonstrate the existence of a loss of value. Also, it is advisable to carefully review the tax assessment to ensure that it has been calculated correctly.
In conclusion, the municipal capital gains tax is a tax that can generate doubts and confusion, so it is important to have the advice of a professional at the time of carrying out a transfer of real estate. End