Taxes Archives - Porta Mallorquina Real Estate

Moving to Mallorca? German exit tax and its implications

1Aug By Sonja MeyneNo Comments

Taxes

Moving to Mallorca? German exit tax and its implications

The German Exit Tax is an Issue Especially, But Not Only When Changing Residence. Every fifth middle-class person in Germany is now toying with the idea of emigrating. This is the result of a survey published in July 2023 by the SME association BVMW. Spain, and Mallorca in particular, are seen by many as an attractive new place to live. However, in this case, the German state asks for payment in the form of exit taxation. It is precisely this tax burden that can have serious implications. Taxed like a sale of shares Anyone who moves from Germany to another country is generally affected by the exit tax as the owner of shares in corporations. In exceptional cases, this also applies to partners in partnerships or sole proprietors. The taxation is the same as for a profit from the sale o...

30Jul By Sonja MeyneNo Comments

Mallorca, Taxes

The tax wheel in Spain is turning

The following are the most important facts regarding tax changes in 2023, for owners of real estate on Mallorca and for those who intend to become owners. The new government, elected in June 2023, introduced some changes at the beginning of the year and now promises tax relief and new opportunities for property buyers and touristic rental property owners. The conservative People's Party (PP) will, however, operate as a minority party and so will need to rely on the support of the right-wing populists of the Vox party. New governmental pact in the Balearic Islands: Implications for property buyers and owners Under the designated Balearic president Marga Prohens, the parties have agreed on a government programme that aims for diverse tax reductions. In the area of property purchases, th...

17Aug By Porta MallorquinaNo Comments

News, Real Estate, Taxes

Whether to inherit a property in Mallorca or to give it as a gift? A question of cost …

Transferring your holiday property wisely can save a lot of money, as in extreme cases the tax levied on inheritances or gifts in Spain can be more than 70 per cent. It can, however, also be done much more cheaply and to that end, we would like to provide an overview and explain where traps lurk and where the opportunities for non-residents can be found. Anyone who owns a property in Mallorca must sooner or later ask themselves the question - what will happen to my holiday property when I am no longer alive? Is giving it as a gift during my lifetime the right step or would a normal inheritance be a better way? When transferring real estate in Spain a number of legal regulations have to be considered, and it makes sense to deal with these issues well before the transfer takes place. It c...

25Feb By Porta MallorquinaNo Comments

Mallorca, News, Taxes

Mallorca as a home-office paradise

... but look out for the tax implications. If your main and/or fiscal domicile is in Spain, all your assets must be declared for taxation there. Stefanie Claudia Müller Many consider it cynical that executives enjoy the sun in times of pandemic, while their own employees in Berlin, London or Paris fear for their jobs every day and nurses, sales staff and teachers are in danger every day from infection through direct contact. The Balearic Islands, however, were a popular location for digital nomads even before the Coronavirus. These are the people whose companies travel with them or who, being programmers, journalists or mathematicians, can work almost anywhere. Sabine Christiansen is probably one of the few Germans who openly admitted in an interview in the summer of 2020 that she...

1Jun By Sonja MeyneNo Comments

Taxes

Tax on real estate

Fiscal surprise package: the Spanish 'owner-occupation tax' on real estate. During introductory consultations with Germans who have owned property long term in Mallorca we experience a particular situation time and again: In reply to the question whether they have been paying income tax for the previous years of ownership they answer that they have no income from renting out the house as it is only for private use. Anyway, there has been no contact from the Spanish fiscal authorities and ''they will tell us if they want something from us''. Subsequently we have to inform the clients that they have a completely false understanding of various relevant tax issues. To begin with, in Spain self-assessment applies. This means that the fiscal authorities does not contact individuals t...

7Jan By Sonja MeyneNo Comments

Mallorca, News, Taxes

New taxes for Mallorcan properties 2016: what buyers and owners need to know

Those who are living on the island for quite some time know: at the turn of the year, there will be some „famous” taxes changes in the Balearic Islands. Starting the year, the islands also have a new government and consequently many things will change that are especially interesting for buyers and sellers of properties. In our interview, Mr. Arne Seeger from the law office Dr. Früheck Abogados S.L.P. explains the most important changes that concern you as a resident or a non-resident, especially if you own a property or want to sell it. Mr. Seeger, please tell us what will change for taxpayers as from 2016? First of all, there is a change in the income tax, the so-called IRPF (Impuesto sobre la Renta de Personas Físicas). We have to distinguish between residents and ...

15Nov By Porta MallorquinaNo Comments

Taxes

New tax laws for Spain in 2015

The proceeds from the sale of a property in Spain are taxable even for non-residents. From 2015, the tax rate on income to persons whose principal residence is in the EU is 20% instead of the previous 21%. For resident property sales in Spain, the tax burden from next year will be 24% instead of 27% (from gross income from the sale of over 24,000, – €). Especially for owners who purchased their house in Majorca before 1994 and now want to sell it, the new tax law in 2015 might be infavourable. Is this good news for sellers? Unfortunately not, because the tax reform has caused the government to retroactively “compensate for inflation and reduction coefficients” from which, there is a significant taxable income especially on older properties. Sales in 2014 are still wort...

6May By Porta Mallorquina4 Comments

Mallorca, Taxes

Holiday lets in Majorca – here’s how to let legally to holidaymakers

Since the reform of the tourism regulations, everyone is talking about holiday letting in Majorca. No wonder given that such lettings offer owners attractive additional income during the times when they are not using the property themselves. But what about holiday apartments? Can they be legally let too? And does the owner become a tour operator if he offers his finca to let on the Internet? On 26th April Porta Mallorquina invited guests to a Brunch with speakers talking on the subject of holiday letting. These and other urgent questions were answered on 26th April by solicitors Guillermo Dezcallar Enseñat and Javier Blas Guasp from the legal firm ILLESLEX at our info event and brunch at our estate agency in Pollensa. Señor Dezcallar Enseñat, why is there so much confusion at the moment...

4Dec By Porta MallorquinaNo Comments

Mallorca, Taxes

Tax changes in Spain from November 2012

If you have to pay invoices in Spain, you will be henceforth forbidden to do so in cash for payments exceeding € 2.500, when one of the two parties is a company or a professional. With this regulation, the government wants to eradicate the deeply rooted habit of paying cash without VAT - and therefore not declaring the income - of bills, such as those for craftsmen. For property sales between private individuals they are exempted from this regulation, only when the buyer is a tax resident in another country. In this case, the cash limit is a maximum of € 15,000. If you want to take advantage of the tax benefits for the purchase of a property there’s no tax benefit by doing so through a company (SL) any more. This legal form was once the preferred model in order to avoid paying tr...

11Jul By Porta MallorquinaNo Comments

Mallorca, Taxes

Spain raises the VAT as of the 1st of September of 2012

Spain raises the VAT as of the 1st of September of 2012. VAT exceptions in the purchase of property will only be valid until the end of the year. On the 14th of July of 2012 and according to article No. 23 of the official state bulletin, the Spanish government has increased the VAT values as of the 1st of September of 2012 as follows General VAT: increased from 18% to 21% Reduced VAT: increased from 8% to 10%. The especially reduced VAT of 4% for the purchase of newly built properties from promoters (instead of 8%), will remain being valid until the remainder of the year 2012. As of January of 2013, this VAT reduction will no longer be valid and will be applied at a rate of 10%. Are your interested in purchasing a property in Majorca? Well then now is the perfect time...