CHEAPER PROPERTIES WITH VAT AT 4% - PART TWO

CHEAPER PROPERTIES WITH VAT SAVINGS SPANISH GOVERNMENT REDUCES VAT FOR NEW BUILD PROPERTIES Date: Thursday, 01 September 2011 Following the Spanish Government announcement 25th August, we have recently found out the exact terms of the law and to which properties and payments for properties the VAT from 8% to 4% may be applied. These terms have now been confirmed by the tax authorities and are as follows: 1.       4% VAT will be applied to all part payments made by clients between 20th August and 31st December no matter when the property was purchased or when it will be handed over. 2.       Again 4% VAT applied to "key in hand" properties paid in full before 31st December 2011. 3.       All payments made before 31st December 2011 for properties under construction will only be charged a 4% VAT therefore if clients want to advance their payments to benefit from the VAT reductions, they are welcome to do so. Furthermore, for those clients whose payments have been at 8% during the last few days, we will proceed with the following measures: 1.       Those who have paid the property in full, TM will pay back the corresponding VAT for payments made after 20th August. The refund will be made before 15th September therefore we urge you to ask your clients for a bank account number to make the refund. 2.       For those who have made part payments after the 20th August, we will apply the difference at the hand over of keys. Warmest regards, Scott Innes Senior Partner - SJI Overseas - In Partnership with: TM Grupo Inmobiliario