# property tax



## kevino (May 7, 2013)

I gave a lawyer power of attorney as we were unable to sign on the date to buy a property , He under declared the price without my knowledge and now we face a tax bill of 50000euro . Any answers ?


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## canoeman (Mar 3, 2011)

How've you got a tax bill for 50,000€ what's the bill actually for? bit more detail and you might get an answer


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## kevino (May 7, 2013)

Hello We we bought in2004 and struggled to get the deeds till 2006 we sold in 2007 and the 50k is for Capitol Gains , but the lawyer under declared the house by 60000 so we need to pay CGT on that amount as well as the actual gain . Hope it makes sense . Ta


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## canoeman (Mar 3, 2011)

Not really if you purchased officially in 2006 which I take it to mean the date Escritura was done and sold in 2007, then in 2008 a tax return should have been made for the sale in 2007 on Anexo G.

CGT calculation is
Purchase price as stated in Escritura x inflation (believe 2004 was 1.08 & 2006 1.02) co-efficient added to p/p for year of purchase = A
Selling price as stated in selling Escritura less buying expenses (IMT, IS, Registration, Lawyer, Notary, POA, capital improvements within 5 years of sale correctley receipted, selling commission providing PT estate agent and now must be named in Escritura) you could claim POA but you couldn't claim solicitors fees for selling=B
B-A = gain as a non resident? you would have been taxed @25% on 100% of gain.

If the return wasn't made then no doubt you'll have interest & penalties at least you can check figures, if your lawyer under declared afraid your problem you can't do anything about it unless he pocketed the 60,000€ which if you can prove then you have a case against him.

Telling Financas now would just creates further problems for as you would have underpaid IMT & IS at time of purchase, its why the advice is don't do any under the counter deals the person that comes unstuck is you


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## kevino (May 7, 2013)

thanks very much , for your reply I will not be doing any under the counter or giving anyone else POA even LAWYERS !!!!!!


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## canoeman (Mar 3, 2011)

Apparently you did unknowingly major problem with Financas is when your billed for what they consider to be a debt if you don't pay by the due date it automatically escalates so you either have to be extremely quick in challenging their figures or pay and then argue for a refund, hope you didn't spend all of gain from property sale, hope you do realize that 50K CGT bill would mean a gain of 200,000€ sure that's all that's involved?

Don't be put off POA but they should be tightly worded so you don't just give Carte Blanche authority for anything, I did similar to you but POA specified the persons responsibilities and amounts they could must sign for.


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## kevino (May 7, 2013)

Thanks for that I will not be giving anyone POA I am amazed the authorities will not consider any action towards the lawyer who I believe is supposed to act in my best interest . And declare a false figure to the authorities . We live and learn !!!


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## canoeman (Mar 3, 2011)

He would say he saved you IMT & IS of course his action is illegal but again no doubt he would say he was acting on your instructions, you gave him the slightly too open POA, don't get me wrong I'm not unsympathetic but unless you can prove he pocketed the 60,000€ its you landed with the consequences and any complaint to the authorities this long after event will come back at you, the only time you could have complained was immediately after Escritura and quering and reporting that the purchase price was incorrect


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