Thursday, November 26, 2009

Britons to get £283m Spanish homes tax rebate

Thousands of Britons who sold their villas in Spain since 1977 are expected to receive a significant tax rebate after a legal judgment that they have been overtaxed.

In a landmark legal victory, Britons who sold a property in Spain during the Costas have been told they are now entitled to claim a 20% tax refund from the Spanish government by The European Court of Justice that means Britons may be able to claim back up to £283 million in capital gains tax charges, due to the discriminatory way the levy was implemented.

Britons and other non-Spanish buyers were charged 35 per cent and the inflated rate trap was a whole 20 percentage points above the charge for Spanish citizens - which has stood at 15% throughout the period - and contravened European Community Treaty rules. This two-tier system was overhauled and replaced with a single rate of 18% for both residents and non-residents Two years ago.

HiFX revealed that the Spanish government owes an estimated £283m to British citizens alone, at an average of £13,370 per claim. Furthermore, the new ruling extends the reclaim period by eight years. Earlier, Britons were able to claim for the period 2004-2006, but the ECJ's decision will open the floodgates to claims for any property sale in the period 1997-2006.

Mark Bodega, Marketing Director HiFX said: 'This announcement by the ECJ is huge. We are currently working with 600 British claimants who are in the process of putting their cases forward. We now urge anyone else who thinks they may have been affected by this to come forward.'

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