Plus valía – claims for the return of Town Hall tax

Filed under : Conveyancing & Property Law, Tax Planning - Inheritance

Anyone who sold a property in Spain at a loss may be able to recover taxes paid to the Town Hall known as the plus valía tax. The highest court in Spain, the constitutional court has made a landmark decision which supports previous regional court decisions. This dictates that certain articles in the Law on Local Taxes are contrary to the Spanish constitution. A principle of the constitution is that taxation must take account of the economic capacity to pay and for this reason a tax cannot be charged where a person has sold a property for less than the price they paid to purchase.

In some cases this local Town Hall tax has been tens of thousands. The decision will affect many of those who sold their property after the property crash of 2008 and before prices began to recover. Since the beginning of the crisis many people have sold at a loss so a tax referring to “an increase in value” is inherently unjustifiable and has now been held to be contrary to the Constitution.

Unlike mortgage floor clause claims – see article at – many of the Plusvalía claims may have to be pursued in the courts if the Town Hall refuses to return the monies paid. As a necessary first step, and before going to court, a formal claim needs to be made. This must be done within the 4 year period after the tax was paid. For a small fee this step can be taken to prevent your claim becoming time barred.

Each claim needs to be reviewed by an experienced lawyer – abogado – to see if it is cost effective to pursue. It is important to stop prescription running by sending the initial claim to the Town Hall. Interest will also be payable on the amount to be repaid by the Town Hall.

If you have paid this tax on a sale at a loss, you may be able to make a claim in the courts for the return of monies paid. You will need copies of the deeds and evidence the tax has been paid. For more information please call us on 952 527014 or contact us on We have property and litigation experts who can advise you in your own language, English,Spanish,Dutch,French, German and the Skandinavian languages.