The campaign by the Spanish tax authorities to find all newly built structures, alterations or changes of use of properties which have not been declared to the Land Registry is starting to show results.
The first phase of Hacienda’s plan has covered 486,000 properties in 29 municipalities in Malaga province so far, especially Fuengirola, Benalmádena, Mijas, Vélez, Antequera, Alhaurín de la Torre, Cártama and Alhaurín el Grande.
Inspections have revealed 30,113 buildings (6.2 per cent of the total) which had previously been invisible to the authorities for tax purposes because neither their owners nor the respective town halls had declared them, irrespective of whether or not they had works licences and the necessary certificate of occupancy.
The most common irregularities involve new construction (a ‘toolshed’ which has become a villa, for example, or a family-owned piece of land on which the children have all built themselves a house alongside that of their parents), which represent one third of the total. Another 36 per cent are extensions and modernisations (gaining some extra metres from the patio at the back to create a garden or parking space); 15 per cent are alterations or changes of use (enclosing a terrace to create an extra room, among others); and the remaining 16 per cent are swimming pool constructions.
Now all is in order with regard to these properties, with the consequent increase in the rateable value and its inevitable repercussion in taxes, the amount of which varies depending on this rateable value. These include state taxes such as IRPF (income tax) and wealth tax, regional taxes such as inheritance and transfers or municipal taxes like capital gains and, principally, IBI.
Sources at the Land Registry point out that people are not being fined for the irregularities which are detected, but fines can be issued by local councils and the regional authorities in the case of illegal construction. They therefore stress that “the objective of this plan is to fight fraud by finding properties which are benefiting from municipal public services at the expense of property owners who have declared everything correctly.”