It seems many people on the forums have been discussing buying property lately. First off, congratulations to everyone who has successfully purchased their new home! However, today I want to share a ‘little surprise’ you might encounter after buying a property—a supplementary tax notice from Hacienda (the Tax Agency), known as ‘la complementaria’.
I bought a resale property myself late last year and managed to negotiate a pretty good price, slightly below the market value. I happily paid the ITP based on the agreed purchase price, thinking everything was settled. But then, a couple of weeks ago, I received that letter from the tax office, stating I hadn’t paid enough tax and needed to make an additional payment, plus interest. I was completely baffled and immediately contacted my lawyer, who then explained the whole situation to me.
Why Are You Asked to Pay Additional Tax?
The core reason lies in a new concept implemented since 2022: Valor de Referencia.
In simple terms, the Spanish General Directorate for Cadastre now uses a series of complex algorithms to calculate an official ‘reference value’ for each property. When you complete a property transaction, the tax office compares your actual purchase price with this official reference value and uses the higher of the two as the tax base. If your declared purchase price is lower than this reference value, the tax office will consider it ‘under-declared’ and demand that you pay the tax on the difference.
How to Check Your Property’s Reference Value?
This information is public and can be checked by anyone. You can go to the Cadastre’s electronic office website and look it up using the property’s cadastral reference number. It’s advisable to check this before making an offer on a house, so you have a clear idea and can avoid potential trouble down the line. This reference value is updated annually.
What to Do If You Receive a Supplementary Tax Notice?
Once you receive the letter, you have two main options: accept it and pay the additional tax, or file an appeal. Which one you choose depends on your specific situation.
| Option | Pros | Cons |
|---|
| Pay the tax | Simple process, avoids further penalties or interest | You might pay more in Spanish property taxes than necessary |
| File an appeal | If successful, you save money by avoiding the payment | Complex process, requires professional evidence, can be time-consuming and costly |
My lawyer told me that the success rate for appeals isn’t very high because you need to provide very strong evidence to prove the official reference value is incorrect, such as a professional property valuation report or proof of specific defects that lower the property’s value. Considering the cost and time involved in an appeal, I ultimately chose to just pay up for peace of mind. I hope my experience can serve as a heads-up for those who are currently house-hunting or have just bought a property. Don’t overlook this pesky Valor de Referencia!
