The Spanish Cadastral Office is scanning the whole of the Coast looking for new builds, renovations or changes of use of buildings that were previously invisible to them.
Obtaining fresh money. And so far, many local town halls are rubbing their hands as they are receiving a significant economic injection via the IBI, (property tax) but obviously to the annoyance of those owners who have ignored their obligation of informing the local authorities of works carried out years ago.
Only Alicante has 450,000 households with a lower rateable value to its real one. A total of 449,304 homes and buildings located in the province of Alicante are likely to be discovered soon by the government plan to detect irregular properties that violate the Land Registry law. Cadastral regularization plan to locate undeclared construction in recent years includes 107 Valencian municipalities and a total of 911,132 buildings, 78,061 of them in Castellón, Valencia 383,767, and 449,304 in Alicante.
The review to be performed is based on the third additional provision of the revised text of the Law on Real Estate Cadastre (Royal Legislative Decree 1/2004 of March 5th), introduced by paragraph three of Article 16 of Law 16 / 2012 of 27 December, amending various tax measures aimed at consolidating public finances.
A 10% of all buildings are fraudulent.
It is anticipated that at least 10% of these municipalities’ properties discrepancies will be located, so their owners must pay the corresponding IBI increase for those changes. The government forecast is that almost all Spain will have passed inspection later this year, but the new publication in the BOE estimated completion date for these new municipalities will be in July 2017.
At least 7% of the property to which the cadastral office have notified the new IBI increased could have been mistaken. It is important to scrutinize the cadastral proposal because any discrepancies with the assessment by the administration on your favour will mean a benefit for life.
This massive scrutiny
This massive scrutiny, taking place throughout Spain (except the Basque Country and Navarra), began in 176 municipalities in 2013 and has spread to the rest of Spain.
As contained in the State Budget during the last year 1.5 million notification of regularization was sent from the land registry to properties owners informing of errors on their properties and let me add here that most of them were to notify an increase in their IBI.
But the property hunt if the building description contained in their records match the reality does not end there. Having covered the main population centres they are putting the focus on major developments in the Coast areas during the first semester using aerial orthophotos inspections, together with physical visits to see the actual alterations. They are focusing on small towns where illegal construction predominates.
Later, on the second half of this year and the first of 2017, the search will be extended inland.
There are 42 municipalities in the province of Alicante where the cadastral regularization procedure has been completed.
The idea is to prosecute any tax fraud which incorporates new construction or large alterations, rehabilitations or reforms in buildings that have not been declared. The aim is to ensure that the cadastral description of each property fits the urban reality.
How the regularization process starts.
The legal procedure commence by comparing new aerial orthophotos with the information contained in their records, these aerial images are taken from aircraft or satellite and checked for alterations. Inspection visits are also made to suspected properties.
Owners have to pay a 60 euros fee, that money is intended to finance the inspection work.
The tax increase of this rateable value of the property will affects the quota set as based on its value. Thus, it will affect the municipal taxes (IBI and capital gains, regional inheritance and transfer tax. An all-rounder.
If we examine the main irregularities types, they are by importance: new houses (original an agricultural store that it was converted into a brand new villa inclusive of swimming pool Jacuzzi etc, It is a larger fraud, but not the most numerous it will affects about 29% approximately 16,200 properties.
At the head of 'ranking' are the extensions and renovations (adding a plant to a house, increasing a few meters the bedroom onto the backyard or to create a new garage) 37% of cases. Another 24% respond to reform and change of use (rehab of an old house or the closing of a terrace to add another room) and the remaining are new swimming pool construction about 8%.