Q Intending to buy property in Spain I was advised to avoid using a solicitor as their role is basically the same as that of the notary anyway. I want to keep costs down. Should I dispense with a solicitor?
A. As we have seen, cutting out the solicitor has led to many problems: properties built without planning permission, the neglect of a 10-year guarantee, habitation certification, etc.
There are vital differences between the notary and solicitor. The purpose of the notary is to merely place on public record formal documentation regarding legal transitions; especially relating to property conveyance and the setting up of companies.
The solicitor ensures the property is legal and obtains documents necessary for the transfer. He will find out if there are outstanding debts on the property, which need to be settled.
As facilitator between the buyer and seller?s banks, estate agents he liaises with the notary office. He will make certain the property is free of liens, encumbrances, or charges such as mortgages. There will also be aspects relating to property taxation, especially for non-resident buyers and sellers.
If such matters are not handled competently, then the buyer and sometimes the seller may be exposed to serious risk.
When signatures are exchanged the solicitor carefully peruses the draft of the deeds written by the notary?s clerks, for the approval of the buyer and seller?s solicitors. He also coordinates payments and the cancellation of charges; usually the mortgage; translates and explains the content to his client.
The solicitor checks satisfactory compliance with tax affairs, to make sure the title deeds are inscribed at the Land Registry, without which the property could not be subsequently sold.
Notaries never intervene in these procedures, essential to ensure the security of both the vendor and buyer. It is simply not sensible to proceed without a solicitor. In summary the notary acts on behalf of the state and the law: The solicitor acts on behalf of his clients.
Q. The term padron and empadronarse are terms that keep cropping up I know it is a form of registration but I am not sure as to the implications, the benefits or legal requirement to complete the process. Can you shed any light on it?
A. A timely question as it coincides with the British Embassy in Madrid promoting the empadronarse and setting out its reasons for doing so. The padron is simply a register of those people who live in each municipality. Registering is required of those who spend more than six months a year in Spain be they property owners, tenants, or long term ?guests?.
It is how each Town Hall knows how many people live in the municipality in order to meet the community?s needs. Protected by data protection laws it is not a prying device.
To register, visit the padron desk at your local Town Hall. Take your passport, NIE certificate, a utility bill in your name or the person you rent from, and a copy of your deeds or rental contract.
As resources allocated to each municipality are based on the numbers on the empadronamiento by registering you help yourself and your local community. These include better public services, improved access to health care facilities, a reduction in some taxes plus discounted access to leisure and cultural activities.
Q. What are the tax implications for someone who owns property and rents it to tenants for a few weeks to subsidise their income? My friend does so for just six weeks a year but jealous neighbours reported her to the administrator of the urbanisation. He says the Inland Revenue will be informed and court action may be taken.
A. That informal renting is commonplace doesn?t legitimise it, and yes it can be regarded as taxable income and IVA (VAT) is applicable. It is no different from the unregistered tradesman ?doing a bit on the side.? Check the community rules to see if it is allowed. There are risks other than tax. Accidents do happen. Could you claim against insurance cover if an accident happens as a consequence of a letting?
Legitimate rental-tourism is showing year on year growth so it might be worthwhile to consider your second home as a business. The better established holiday letting services will guide and advise you as their success is based on your satisfaction and safety.
Legal Eyes: 672 834 622
quite_write@yahoo.co.uk
