Plusvalia (Municipal Capital Gain)

What is plusvalia?

The plusvalia (municipal capital gain) is the Tax on the Increase in Value of Urban Land. In other words, it is the tax that is automatically applied by the Administration when transmitting an urban real estate, either through a sale, an inheritance or a donation, among others.

The town hall taxes the increase in cadastral value of land during the time that the seller has owned it.

When does an increase in land value occur?

As a general rule, there is always an increase in the value of the land over time, and it is for this reason that we will always be obliged to pay taxes.

The town hall calculates the capital gain through coefficients that are applied based on the years elapsed since the acquisition and transfer of the real estate property. This is done using the cadastral value (a kind of notional rateable value) of the land of that property, and NOT the values ​​assigned in the notarial deeds.

In this way, although at the time of selling you might have incurred a loss on the property (e.g. it was acquired through sale and purchase for a value of € 100,000 and two years later it was sold for € 50,000), the Administration will continue to issue us the settlement of the capital gains tax, since, according to their calculations and coefficients, the value of the land will have increased.

After the Constitutional Court Judgment of October 31, 2019, it was declared that situations of absence of value increases could not be subject to tax.

This resolution has caused an avalanche of lawsuits that demand the sum unduly paid through the capital gains tax be repaid.

How can we reclaim Plusvalia that has been paid?

Below, we present the steps to follow to carry out such a claim:

1- In the first place, we must pay the municipal capital gains tax.

2- Once paid, we have a period of one month to claim the amount through the administrative channel through the Reposition Resource.

The claim by administrative means is a compulsory previous step to the judicial claim.

Once the appeal has been filed administratively, the administration has six months to reply. If after six months we have not received a response, there is a so-called “administrative silence” that constitutes the rejection of our appeal.

Therefore, if six months elapse without we are having received a response from the administration (administrative silence) or it is directly negative, we can start the last step:

3- The claim in court, through the contentious-administrative jurisdiction.

Not all cases and claims have the same possibilities. From Sun Lawyers we analyze and value each file, in order to guarantee its success.