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INE records highest number of property sales since 2008

Raymundo Larraín Nesbitt, September, 1. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years' taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record of successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Lawyer - abogado
1st of September 2021

As Spain’s leading property portal IDEALISTA reports in its article of August 2021, property sales over the last six months are at levels unseen since 2008. Spain’s National Bureau of Statistics (INE) reports 267,700 properties sold during the first 6 months of this year. We need to look back 13 years, all the way back to Spain’s property boom heyday, to see such healthy sale figures.

You can see the graphics here: House sales in Spain in 2021 (first six months of 2021)

In June alone, over 48,000 properties were sold, which is an 73.5% interannual increase. This is hands down the best performing June in real estate history. This confirms the unabated trend that we are witnessing the best sale figures in over 13 years. The property market has been nothing short of spectacular from March of this year.

There are several underlying factors that help to explain this spectacular property rebound which we’ve been collating in several articles:

 

The main one - at least in the region of Andalusia - has been a drastic reduction in taxes on buying property; both offplan and resale which we also reported at the time:

 

On offplan property, this change translates into tax savings of 20% in Stamp Duty.

On resale property, the reduction follows a sliding scale depending on the sale price. Starting at a 12.5% reduction on lower-end property and rising to over 30% for high-end villas. Meaning, the higher the sale price, the more taxes a buyer stands to save! This factor, all by itself, greatly explains the surge in villas sales we have been reporting over the last six months.

The ongoing global pandemic, which has modified consumer behaviour making buyers seek villas with spacious gardens in prime locations, coupled with a drastic tax slash has fostered a property boom that has been going strong since March 2021.

At last, we have Spain’s INE's hard data which serves as official confirmation to back up what we had been reporting over the last six months anecdotally.

 

At LNA we can assist you buying, selling or renting out your property in Spain. We have 18 years’ experience in conveyance & tax. We are also specialized in Immigration & Residency permits.

Larraín Nesbitt Abogados, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, residency, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88, or by completing our contact form to book an appointment.

Related services:

 

 Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2021 © Raymundo Larraín Nesbitt. All Rights Reserved.

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I want a Spanish visa, but I don’t want to pay any taxes in Spain

Raymundo Larraín Nesbitt, August, 1. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists has a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
1st of August 2021

More and more UK nationals are enquiring on the different types of visa available to circumvent the pesky 90/180-day rule that aggravates us post-Brexit.

A question we get, almost on a daily basis, is as follows: “I want a Spanish visa, but I don’t want to pay any taxes in Spain, I don’t want to become tax resident in Spain. I want to continue to pay taxes in the UK.”

This is a bit like saying you want to get married but want none of the fights and obligations that go with it, you just want the good stuff. As its own name implies, attaining residency in Spain means you are applying for an admin permit to live all year round in Spain (to bypass the 90/180-day rule). However, the tax implication of this is that indirectly it may trigger tax residency in Spain should you remain more than 183 days a year in Spain within a tax calendar.

The fact is that visa renewals are tied to proving you live in Spain long term, which indirectly triggers tax residency in Spain. If you are unable to prove you are in fact living in Spain long term, your visa renewal will simply be turned down by Immigration Authorities. So, it’s a catch-22.

But is it really closed to debate? No, there is a loophole.

The only exception to this general visa rule is the investor visa, popularly dubbed as the ‘Golden Visa’ (GV). The reason being is that renewals of a GV are not tied to proving you live in Spain long term, unlike every other visa, but rather on proving you keep the investment that made it possible to attain in the first place. This is a very important nuance.

In plain English, a GV neatly bypasses the requirement to live in Spain all year round, which triggers tax residency. With a GV you can in fact spend as much or as little time as you fancy in Spain. So long as you do not spend more than 183 days a year in Spanish territory within a calendar year, you will not be regarded as tax resident in Spain (it should be noted other criteria may also apply to determine a taxpayer’s tax residency).

This is precisely what makes a Golden Visa the most coveted visa available in Spain, because of its unique ability to override (within the law) the 90/180-day rule and not trigger tax residency in Spain. This distinctive ability, not found in any other visa, makes it hands down the most sought-after visa in all of Spain.

Bottom line, if you want to apply for Spanish residency, but do not want to become tax resident in Spain, your only (legal) option is a Golden Visa, period. Every other visa type hinge on you categorically proving you live in Spain long term, which will trigger tax residency eventually.

LNA has a 100% track record attaining Spanish residency

 

Larraín Nesbitt Abogados, small on fees, big on service.

At Larrain Nesbitt Abogados, we have assisted hundreds of EU and non-EU nationals to successfully attain a Spanish residency permit.

Interested? Come and speak to Larraín Nesbitt Abogados’ friendly staff who will be pleased to guide you through the different residency options, choosing the one that appeals to you most. Your family’s success is only one call away: (+34) 952 19 22 88.

Residency services available from LNA:

 

Related visa articles

 

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. No delusional separatist politician was harmed on writing this article. VOV.

2.021 © Raymundo Larraín Nesbitt. All Rights Reserved.

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European Court of Justice’s lead council states Spanish Tax Form 720 fines are disproportionate

Raymundo Larraín Nesbitt, July, 21. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record of successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Lawyer – abogado
16th of July 2021

Tax form 720, only mentioning it brings cold shivers to most taxpayers. It is single-handedly responsible for a mass exodus of thousands of expats since its inception and has acted as a firm deterrent of thousands more who refused to become tax residents in Spain to avoid it.

The disproportionate fines of this tax form had been challenged at Brussels and we were expecting a ruling on this matter last autumn, but I guess the emergence of the virus impacted on everything pushing it back.

The ECJ’s General Advocate, Mr. Henrik Saugmandsgaard, in a press release of yesterday concluded that Spain’s unfamous tax from 720 had implemented a system of disproportionate fines that go against the spirit of the Union.

Quoting the text: “M. Saugmandsgaard observe que ces amendes forfaitaires sont 15, 50 et 66 fois plus élevées que celles appliquées dans des situations internes.“ The fines are 15, 50, and 66 times higher than those applied in internal situations.

He continues: “Même  en  tenant  compte  de  la marge  d’appréciation dont  disposent  les États membres afin  d’établir  les  sanctions  appropriées, ces amendes  sont  tellement  élevées qu’elles paraissent disproportionnées, sans qu’il soit nécessaire de faire ici la distinction entre les différentes catégories de biens.“ Even if Member states have the power to modulate the appropriate fines, these fines are disproportionate without even needing to go into the different types of assets.

The gist of his report is that, as we had cared to point out repeatedly over the years, the fines levied by the Spanish Tax Office are completely disproportionate by rapport to other cases; they simply jump off the scale for no apparent reason.

He concludes: “L’avocat général propose donc à la Cour de déclarer que l’Espagne a manqué aux obligations qui lui incombent de garantir la liberté consacrée à l’article 63 TFUE (capitaux) ainsi que la liberté correspondante prévue  à  l’accord sur  l’EEE…“ The General Advocate proposes the ECJ to declare Spain in breach of the freedom of movement of capital enshrined in art. 63 of the TFEU. In other words, and in plain English, with this tax regulation Spain is breaching the core covenant of the foundational European treaty of Rome which sets out a series of freedoms as the guiding spirit of our Union.

What significance does his report hold?

None, all.

None, because it’s just a non-binding report. The report has only a purpose of guidance, but it is ultimately non-binding and not enforceable in any way.

All, because in 80% of the cases the ECJ follows the meticulous criteria laid out by its General Advocate. This is the first step of two required to overrule these lopsided penalties imposed by Spain.

The ECJ’s ruling

In a few months’ time (likely by the fall of ‘21) the ECJ will give it’s final ruling on tax form 720. In line with what we were long expecting, it will declare the overblown fines as null and void.

Conclusion

Kudos to our EU Overlords on this, they are right on track to rein in the Spanish Tax Office’s fiscal voracity.

Spain is the fifth country in the whole OECD (38 countries) with the highest fiscal pressure. Notable exceptions within Spain are the autonomous regions of Andalusia and Madrid (because of devolved competencies on tax matters).

If anything, Spain needs to urgently lower its taxes to become more competitive, attract foreign investments, and foster commercial activity on a large scale. Spain’s taxes are far too high as they stand right now. Also, I may add on a personal note, its bloated public sector needs to be trimmed down significantly to more manageable levels in line with fellow EU Member states.

 

L’art de l’imposition consiste à plumer l’oie pour obtenir le plus possible de plumes avec le moins possible de cris.” – Jean Baptiste Colbert.

French economist and Finance Minister under King Louis XIV.

Translated as: “The art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing.”

At LNA we can assist you buying, selling or renting out your property in Spain. We have 18 years’ experience in conveyance & tax. We are also specialized in Immigration & Residency permits.

Larraín Nesbitt Abogados, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, residency, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88, or by completing our contact form to book an appointment.

Related services:

Tax form 720

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2021 © Raymundo Larraín Nesbitt. All Rights Reserved.

Blog post first published on SPI: European Court of Justice’s lead council states Spanish Tax Form 720 fines are disproportionate

 

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Villa property boom: 573 selling a day in Spain!

Raymundo Larraín Nesbitt, July, 12. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years' taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record of successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Lawyer - abogado
11th of July 2021

As we've been reporting over the last months (since March 2021) the property market is undergoing a sale frenzy in Marbella, and Costa del Sol, specifically the higher-end over 1mn.

We have reviewed in detail the reasons behind this (for reference our Idealista article: Marbella’s high-end market is booming!). 

But this phenomenon is not exclusive to Marbella by any means. It can be predicated of other parts in Spain, such as the Balearics.

As El Mundo newspaper reported last week, over 573 villas are being sold every day in Spain following data from Spain's Land Registry Association. We need to go back 14 years, to 2007, to witness such a frantic property sale frenzy. These are sale figures unseen since Spain's last property boom.

In the particular case of Andalusia, the huge tax cut in taxes on buying property has prompted a huge leap on house sales. As a personal anecdote, I had to stand up the other day at a notary in a house sale for three hours straight because all available seats were taken! I hadn't experienced this since 2007, during the last property boom, which started in 1997 and went on until 2007 (ten years).

Tha property market's changed in Andalusia (high-end) over the last five months, since the drastic tax cuts of 28th April 2021. We are now in a seller's market!

It has now become apparent to all as we had continuously highlighted and defended in all our articles and blog posts that property buyers are highly sensitive to tax changes. The fact that a foreign investor can now buy a villa in a prime location in Marbella and pay 30% less tax, or even less, has certainly had an impact on the real estate market. These are the type of tax incentives politicians should be working on to foster foreign investments in Spain, which in turn help to create jobs and wealth.

Grateful voters remember these things, just sayin'...

 

Im nin'alu daltei n'divim daltei marom lo nin'alu.

Even if the gates of the rich are closed, the gates of heaven will never be closed.

At LNA we can assist you buying, selling or renting out your property in Spain. We have 18 years’ experience in conveyance & tax. We are also specialized in Immigration & Residency permits.

Larraín Nesbitt Abogados, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, residency, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88, or by completing our contact form to book an appointment.

Related services:

 

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2021 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Reminder - Q2 2021 Non-Resident Income Tax filing

Raymundo Larraín Nesbitt, July, 1. 2021

Marbella-based Larraín Nesbitt Lawyers has over 18 years' taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain. You can review here our client’s testimonials.

Copyrighted © 2021. Plagiarism will be criminally prosecuted.

 

Just a gentle reminder to all non-residents, who own property in Spain and rent it out (whether long or short-term i.e. holiday home); you must file your Q2 2021 quarterly tax return now in July. You are being taxed on your rental income for the previous three months: April, May, and June.

For 2021, the non-resident tax calendar is as follows:

  • Q1 January – March. Filed on the first 15 days of April
  • Q2 April – June. Filed on the first 15 days of July
  • Q3 July – September. Filed on the first 15 days of October
  • Q4 October – December. Filed on the first 15 days of January 2022

 

Our cut-off date to accept filing Q2 2021 non-resident tax returns is Thursday the 15th of July 2021.

Please do not wait until the last moment to submit your quarterly tax return. We file this tax online all over Spain within 24 working hours.

We can offer you this tax service for a very competitive fee: 125 euros plus 21% VAT.

The quoted fee is per property and per tax quarter, it includes up to two joint owners i.e. husband & wife.

Our fees are 100% tax-deductible from the tax to pay.

The main highlight of our tax service is that we reduce your income tax by 70%, or more, on applying for lenient landlord tax relief on all your property-related expenses.

Contact us and pay less tax. If you overpay taxes in Spain, it is only because you want to.

 

Q2 2021 tax submission period

From the 1st to the 20th of July.

Related tax service

Holiday Rental Accounting Service (HRAS)

Related taxation articles

 

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.021 © Raymundo Larraín Nesbitt. All rights reserved.

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Holidaymaker’s demand for holiday rentals outstrips hotels’ with Covid-19

Raymundo Larraín Nesbitt, June, 21. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists has a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

Holidaymaker’s demand for holiday rentals outstrips hotels’ with Covid-19

By Raymundo Larraín Nesbitt
Lawyer - Abogado
21st of June 2021

The overarching impact of Covid-19 in the real estate market cannot be understated enough. We’ve already glossed over in previous articles its huge impact on buying & selling homes. How buyers are now asking for secluded properties, with large gardens, open spaces, large terraces, from which to live and even work from. Marbella is regarded as a safe destination, far away from large city crowds.

Now with the holiday season upon us, we are witnessing again changes in consumer habits developing new trends. Whereas before over the last years demand was split evenly between hotels and rental accommodations, this year we have witnessed how demand on the latter has clearly outstripped that of hotels to the point it’s reportedly getting harder (and more expensive!) to find private rentals. Holidaymakers shun hotels to avoid large agglomerations of guests out of fear of the virus. They are instead looking to book small privately-run accommodations (holiday rentals). Particularly detached villas with spacious gardens and apartments with large open terraces.

For the first time ever, we’ve witnessed a new trend where holidaymaker’s demand for holiday rentals surpasses that of hotels’. 2020 and 2021 have been horrible years for the tourism industry, particularly hotels have suffered the brunt of the ongoing pandemic. And to make matters worse, the Spanish government has approved on the 1st of June a massive rise in the price of electricity (up to 50% more) which has translated on average for hotels to an increase of 10% on their fixed costs. Spain’s electricity is the most expensive in all of Europe with a whopping VAT of 21%; every other country in Europe applies a much lower VAT rate i.e. the UK's is 5% VAT.

I take the opportunity to gently remind non-resident landlords offering holiday rentals in Spain that they need to submit quarterly taxes on renting out.  Our company offers the following competitively-priced accounting service:  Holiday Rental Accounting Service (HRAS)

The main highlight of our tax service is that we reduce landlord’s tax bills by 70% (or more) on applying for tax relief. More on this explained in our taxation article:  Save 70% on your landlord tax bill – 8th March 2019. Even our fees to calculate and file these tax returns are 100% tax-deductible.

If you are planning to rent out in Spain, do it legally; contact us to greatly reduce your landlord tax bill.

 

Larraín Nesbitt Abogados, small on fees, big on service.

 

Legal services available from Larraín Nesbitt Abogados

 

Related property articles

 

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.021 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Malaga, Europe's Southern California

Raymundo Larraín Nesbitt, June, 11. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists has a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Lawyer – Abogado
5th of June 2021

They called it the Californian miracle. Back in the early 80’s, nothing made anyone suspect that only two years later, in 1982, the US, and in particular California, was going to experiment an unprecedented economic boom, one of the of the strongest and most steady ones witnessed to date. The impending threat of an all-out nuclear war against the mighty U.S.S.R., the social fallout of losing Vietnam war, a heavy tax burden with top personal marginal income tax rates of 70%, huge unemployment rates all looked poised to drag down the country’s economy and lose the whole decade.

However, a new young administration stepped in, led by a not-so-young politician from Illinois who, to make matters worse, was an ex-actor of cheesy westerns. No one was expecting much, least of all his first ex-wife who famously said he would never achieve anything in life. Yet, he ploughed on and proved everyone wrong. He carried out a series of key changes within the country that would lay the framework to the economic boom that followed soon after and spill over into the next decade, all the while keeping a watchful eye on international affairs. Simplifying his reforms:

  • Deregulation.
  • Lowering taxes.
  • Reducing huge unemployment levels which translated into low wages
  • Incentivise new budding technologies & industries through the state-sponsored Strategic Defence Initiative (nicknamed the "Star Wars program")
  • End of Cold War, fall of the Iron Curtain

 

Having successfully averted nuclear armageddon (it was a close call), people were euphoric on having a new lease on life, and the stock markets climbed like there was no tomorrow. The real estate market followed suit with a massive boom across the board. Simply put, people wanted to live and enjoy life, spending money, big time. Unemployment levels dropped to an all-time low. People became spendthrift, (over)spending like there was no tomorrow, taking on cheap credit. There was a psychological component behind this spending mentality that can be explained after people are beset by a great pressure or threat (a nuclear one) and are in the need to find release by getting it out of their system (overspending). After all, being a capitalist society, what better way to prove you’re happy than spending, huh?

California in particular would greatly benefit from the changes brought about by the new administration. Huge unemployment levels, caused by former administrations, were channelled into new jobs in budding technological industries (computing), low wages, ultra-low taxation, booming real estate market, a huge budding technological demand instigated by the ambitious SDI initiative to thwart an ICBM threat all coalesced together creating the bedrock that would help to explain California’s 80’s economic miracle. Even by today’s standards, if California were an independent nation, it would stand on by itself as the 5th largest economy in the world.

And Málaga?

Ok, let’s fast-forward to our lovely virus-ridden world of 2021. So, how’s this history lesson relevant to Malaga you may be wondering? Well, you can draw some strong parallelisms to our current state of affairs, but you do need to pay close attention, reading between the lines to see the big picture, and not get lost in the nitty-gritty details, granted.

Spain, and in particular Malaga is marred by huge unemployment levels (the highest in all of Europe and out of any OECD country) as a result of the ongoing pandemic and its (short-sighted) overreliance in tourism, low wages in relation to European standards, high taxes at a national level, and a whole list of other woes. And to top it off a deadly virus, and all its mutant strains, impacts on Spain’s economy dragging it down. Could matters get any worse?

In view of all the above points, it doesn’t look at all like Malaga is anywhere near duplicating California’s 80’s miracle. Well, perhaps you’d be wrong, look closer:

  1. Ultra-low taxation. Spain is divided administratively into 17 autonomous regions with devolved competencies on tax matters, much like the states in the U.S. After almost 40 years of uninterrupted rule by one political party, 2019 saw a new administration taking office in Andalusia. This new regional government has vowed to bring down taxes. This low taxation trend started right off the bat only a few months in office when they spectacularly slashed inheritance tax (previously over 10,000 families in Andalusia had to renounce to their inheritance every year because they could not afford the ultra-high IHT tax rate set by the former incumbents) to the point they have completely negated it through successive tax reforms. Nowadays, only HNWI pay IHT, and it’s not much to be honest.

The new administration in Andalusia is resolute and has continued this trend unabated throughout 2021 slashing Property Transfer Tax and also Stamp Duty and now have their eyes set to lower Wealth tax, and fundamentally personal income tax (although its ability to tweak the latter is very limited as it’s a national tax). All these taxation changes I have been reporting in detail over the last three years are creating in Andalusia an area of ultra-low taxation that not only attracts individuals, which impacts on the real estate market through market acquisitions, but also, and most fundamentally, large companies (read below).

  1. Deregulation. Andalusia’s new administration is going out of its way to greatly streamline and simplify admin procedures, reducing red tape. As a small example, take tourism licences. What in 2016 was a nightmarish convoluted system with seven different classifications has now been brought to heel with only two options in 2021, making the life of all those involved much easier to apply online. These changes are continuously carried over to multiple aspects, getting rid of the deadwood in an oversized public sector and making it leaner and more efficient. It’s not just idle banter or wishful thinking, the changes implemented are real for us that work with them.
  2. Technology. Malaga has an impressive technology hub in its PTA, which houses over 3,000 technological start-ups. Malaga’s university closely works hand-in-hand with the PTA to supply a steady stream of highly-qualified engineers, programmers, IT designers to these small caps. In fact, some of the companies are becoming so prominent, they have drawn the attention of foreign venture capitalists. For example, Swedish EQT group recently bought for 300mn euros a Malaga technological startup (Freepik) that had created all by itself a market of over 40mn consumers.
  3. Education & languages. Renowned international private schools that dot the Costa del Sol provide the basis of an excellent education in English, German, and several other international languages. Top graduates are regularly invited to join the world’s best universities as per Shanghai’s ranking of leading universities (Oxford, Cambridge, Edinburgh, LSE, Harvard, Yale, Princeton, Stanford, etc).
  4. Low wages. Although Spain’s government has recently enforced a series of improvements by way of raising the minimum wage, the truth of the matter is that Spanish wages, and particularly those in Andalusia, are far behind EU standards, on average 1/3 lower. This is particularly attractive to foreign investors and large companies who have a mind to set up shop in Malaga.
  5. Excellent communications. Airports, toll highways, ports, modern high-speed rail network, etc.
  6. Investors and large companies. All these factors, working together, are attracting the interest of large global corporations which seek to establish outposts in Europe. For example, last week we learnt that Vodafone chose Malaga to create its new Research & Development hub in Europe creating in its wake over 600 highly qualified jobs.
  7. Weather. And last but not least, is Malaga’s gorgeous weather. Malaga boasts 330 days of sunshine throughout the year coupled with great white sandy beaches, scores of which have been awarded coveted EU blue flags. More on this in my blog: 8 reasons to buy property on the Costa del Sol (Andalusia). It’s kind of bizarre, but on a personal note Malaga’s weather, and even its scenery, reminds me of LA’s and California.

Ultra-low taxation, deregulation, technological ingenuity, highly qualified English-speaking local workforce, low wages by rapport to European standards, private international schools (education & languages), great climate etc all help to boost and foster attracting large companies & venture capitalists to Malaga. Do you start to see now the parallelisms? Please let me go on, I’m not done yet.

We are still missing the key psychological component to bind it all together and kickstart it into drive, much like in the 80’s. Fortunately for us, the nuclear threat is all but gone, to a large extent. But we do have something similar nowadays to replace it, the Chinese virus Covid-19. The new vaccinations will see to it that this threat is under control over the next two years and becomes a distant bad dream. The end of the pandemic will translate into people regaining their freedom to live their lives intensely after being grounded for so long with non-stop lockdowns. Freedom to travel abroad unfettered, freedom to spend lavishly in holidays, restaurants, second residences, going to the cinema etc. People need and want freedom badly after feeling trapped for so long under the looming threat of a deadly virus that has kept them grounded too long. Much like the end of the USSR’s nuclear threat in the 80’s, the end of the virus will spell the dawn of a new lease on life for us all which will translate into a burning desire to live intensely and spend money, spend it big time like there is no tomorrow. Spending would be viewed as a necessary cathartic behaviour to restore a semblance of normality back into our lives by way of overcompensation (on the lost time).

You think this sounds daft or far-fetched? Maybe. Would you be surprised to learn that this conduct would in fact mirror the human behaviour which took place in the years that followed the end of the Spanish flu in 1918 that killed 20 to 50 million victims worldwide, which incidentally also originated in China, triggering the golden age known as the ‘roaring twenties’? The end of the deadly virus would again lead to a collective euphoria that would galvanize society globally, acting as a psychological release valve unleashing a spendthrift economy. After all, as classic Greeks liked to point out at every instance, history is cyclical because human nature never changes, and we have Shakespeare’s plays to prove their point.

All of these factors, working in tandem, may coalesce in Spain over the next years, and particularly in Malaga, enabling a new roaring twenties. Don’t get me wrong, frankly, I don’t expect Malaga to (ever) surpass California, or even get anywhere near it for that matter (40mn population vs. 1.6mn), that’s just crazy talk; but if Malaga and by extension Spain plays its cards right into the new decade, it could be well on its way to resemble something close to Europe’s Southern California.   

 

 

Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” – Ronald Reagan

Ronald Wilson Reagan (1911 – 2004). American 40th US President (1981 – 1989). He resolutely contributed to the Cold War victory which led to the fall of the Berlin Wall and the collapse of the communist U.S.S.R. Through cunning and resolute political plays, assisted unwaveringly by staunch political allies, such as Lady Margaret Thatcher, he ensured Western democratic values prevailed and flourished, likely averting World War III. Along with the U.S.S.R.’s greatest president, Mr. Mikhail Gorbachev, he signed the START treaty which would kickstart the denuclearization of the two world’s greatest superpowers avoiding a nuclear Armageddon. A mediocre actor of cheesy westerns turned into a great statesman. Through his steadfast ideals, which almost claimed his life in 1981, his undying legacy would be to ensure us all with freedom.

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Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

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The human cost of Brexit

Raymundo Larraín Nesbitt, June, 1. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Abogado - lawyer
1st of June 2021

Roberta Smithee’s biggest dream had always been to retire to Spain with her loving partner. She had worked hard all her life and had build up a considerable pension pot to that end, diligently saving every month of her life. She had planned ahead carefully and had done all that was expected and required from her.

Now all her dreams have been shattered and taken away from her by the hubris of conservative UK politicians.

Brexit has meant she no longer meets the required income threshold to retire and live in Spain, applying for Spanish residency. Her story echoes that of thousands of other would-be applicants who I am now forced to turn down, day after day.

For it is not the job of smug politicians to deal with all this human tragedy they have sowed, the broken pieces are left for me and my colleagues to pick up and explain to elderly people how and why they can no longer retire to Spain and live in happiness their twilight years as scores of our expats have been doing over the past decades unfettered.

Roberta, in a pre-Brexit world, would have more than qualified to live in Spain. Now, in a post-Brexit world, she and her partner no longer meet the ludicrous €34,000 income threshold to live in Spain all year round.

It is fair to point out these laws were in fact already in place before Brexit and affect all non-EU nationals that seek to apply for Spanish residency on a non-lucrative visa (NLV, or pensioner visa). But this will not assuage her anger or provide her with any solace. She and thousands of other senior applicants have seen their Spanish dream stolen away because separatist politicians failed to properly explain to them the dire consequences of casting a vote to break away from the Union.

But surely this story won’t spoil the lovely posh holidays in Portugal of those ultimately responsible for Roberta’s broken dreams, and those of millions of others, as they are all too busy painting their toenails in fancy colours.

 

I will do everything I can in future to help this great country succeed.– David Cameron

David William Donald Cameron (1966). Is a British politician. Cameron served as Prime Minister of the United Kingdom from 2010 to 2016, and as Member of Parliament for Witney since 2001. The Leader of the Conservative Party between 2005 and 2016. Cameron would see his leadership challenged from within his own ranks, imbued by hubris he placed a huge wager against a EU referendum to selfishly secure his grip as leader of the Conservatives, gambling all our children's future. His gamble backfired spectacularly, and separatists won, even if by the slimmest of margins, to break away from the Union ousting him from power. He will pass down in history as the man who, opened Pandora’s box, broke away from the Union after 47 years, and who gave wings to separatist movements within the United Kingdom, which now relentlessly seek to tear the country apart abetted by foreign non-Western powers. Never in history has a single man inflicted so much damage to the cause of remaining united.

LNA has a 100% track record attaining Spanish residency

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At Larrain Nesbitt Abogados, we have assisted hundreds of EU and non-EU nationals to successfully attain a Spanish residency permit.

Interested? Come and speak to Larraín Nesbitt Abogados’ friendly staff who will be pleased to guide you through the different residency options, choosing the one that appeals to you most. Your family’s success is only one call away: (+34) 952 19 22 88.

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Article also published at Larrain Nesbitt Abogados: How to spend over 90 days in Spain - Residency visa overview

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. No delusional separatist politician was harmed on writing this article. VOV.

2.021 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Off-plan buyers, who bought unrepresented, see their new Spanish home repossessed

Raymundo Larraín Nesbitt, May, 21. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists has a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Lawyer - Abogado
21st of May 2021

As a press clip reports, the buyers were smug and did not find it necessary to instruct a Spanish lawyer on their property purchase. They overconfidently set out to do everything by themselves, unrepresented, and paid the price.

They completed at a notary, they were handed the keys, and proceeded to occupy their new home. However, months after, they received at their home a nasty letter by recorded delivery from the local court warning them that legal repossession was imminent and that they had to vacate the property by a certain date. They thought it was some clerical error and proceeded to ignore and bin it.

A month later the police, bailiffs, and a locksmith showed up to physically remove them from their new home and left them destitute with their life's belongings piled up on the street.

Later on, it transpired their developer owed a substantial amount of money to its lender, bank Santander. Unbeknownst to the buyers, they had failed to follow the legal registration procedure of their new property. Meaning the property was still registered under the developer's name, as an asset, at the time the lender executed the defaulted loan seizing the collateral.

As a result, the law court ruled that their new home belonged to the developer's lender, crushing the dreams and hopes of the couple. They are not entitled to any compensation.

What can be gleaned from this horror story, is that buyers should always instruct a lawyer to represent them on buying property in Spain to avoid any legal issues. The fees that a lawyer charges are in fact 100% tax-deductible on selling the property as we often report in all our taxation articles. It makes zero sense for a buyer to ‘save’ themselves paying lawyer’s fees only to see their life savings jeopardized, or worse.

Larraín Nesbitt Abogados, small on fees, big on service.

 

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Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.021 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Stunning €32mn villa sold in Marbella

Raymundo Larraín Nesbitt, May, 11. 2021

Marbella-based Larraín Nesbitt Abogados (LNA) has over 18 years' taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record of successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2021. Plagiarism will be criminally prosecuted.

Photo credit: Diario Sur.


By Raymundo Larraín Nesbitt
Lawyer - abogado
11th of May 2021

Last month, we reported drastic tax changes in Andalusia that reduced significantly both Property Transfer Tax and Stamp Duty. This is a new tax milestone, which coupled with the significant tax changes of April 2019 in both inheritance tax and gift tax, are effectively turning the region of Andalusia into the most tax-friendly region in all of Spain.

As I relentlessly care to point out every time I get the occasion, low taxation fosters foreign investments on a large scale. Which in turn creates wealth and jobs in its wake benefiting society at large. This is not idle banter or philosophical musings. Lowering taxes has an immediate and significant impact on the real estate market which we notice because we are at the frontline of it.

Andalusia’s right-wing coalition government have publicly announced they will be lowering furthermore a slew of six taxes, including wealth tax. Within the span of only three years, since the new right-wing government took office, the spate of tax changes has turned the tables. Taxation was traditionally Andalusia’s Achille’s heel and is now fast becoming its most important selling point, never mind the sun or beach!

In fact, so much so, that we keep witnessing how client after client after client pay nothing in IHT, even on inheriting large estates since 2019. As pointed out in previous taxation articles, lowering taxes will no doubt act as beacon strongly attracting affluent individuals the world over who relentlessly seek to preserve and increase their family’s wealth.

As a result of this fiscal policy instigated by our regional right-wing government, we are witnessing in 2021 how Marbella’s (ultra) high-end market is performing spectacularly well with multiple mansions selling in the exclusive gated resorts of Sierra Blanca for over €20mn and several others at La Zagaleta for over €30mn. Last week we saw yet another €32mn mansion sold after five years on the market. Diario Sur reports: The most expensive mansion in Europe sold in Marbella. In March we reported on another one of €40mn being sold.

But don’t get me wrong, these tax changes also - and foremost - benefit low and middle-class income bracket families who will now not see their wealth and life savings being confiscated by voracious hard-left wing governments that only contribute to spread misery. Only in 2019, just before the new tax changes in IHT were enacted by the new government, over 10,000 Andalusian families were forced to renounce to their inheritance every year because they were unable to afford paying the steep IHT (source). In no other region of Spain (other than Catalonia, also under the control of a hard-left wing coalition) did so many families need to give up their parent's inheritance because they were unable to pay the extortionate tax rates set by greedy politicians. Mercifully, they were ousted by popular vote, and after the new administration stepped in office, it instigated the ambitious key tax changes of 2019 and now in 2021. As a result, you now don’t see anyone (rich or poor) in Andalusia being forced to renounce to their family’s life savings to finance politicians’ delusional dreams.

And to close, to boot Andalusia has never made more tax revenue than when it bravely lowered its taxes back in 2019 (source) because - again - low taxation (greatly) attracts investments & commercial activity, kickstarting the economy (Laffer curve). Is it so very hard to understand?

Make no mistake, tax hikes only benefit politicians and their ideological cronies, no one else.

 

The inherent vice of capitalism is the unequal sharing of blessings. The inherent virtue of Socialism is the equal sharing of miseries.” – Winston Churchill

Sir Winston Leonard Spencer-Churchill (1874 – 1965). Born into a privileged aristocratic family,  he was an eminent British career officer, artist, historian, delicious eccentric, and laureate writer – awarded the Nobel Prize in Literature in 1953 “for his mastery of historical and biographical description as well as for brilliant oratory in defending exalted human values.” With dogged single-minded determination, he defied alone and managed to stave off, the tyrannical Nazi wave in WWII, unwaveringly assisted by our American cousins, which threatened to swallow whole the United Kingdom as it had already overrun most of Europe. He resolutely led the country out of its darkest hour, restored Europe’s freedom, and laid the groundwork for peace and prosperity which all future generations have come to enjoy since and taken for granted, or so it would seem. As a keen-eyed historian, in line with fellow Founding Fathers Schuman and Monnet, he was quick to grasp and understand the importance of a united Europe to avoid repeat past mistakes which had resulted in two world wars that ravaged the continent. Consequently, he became a staunch defender of the idea of creating a single supranational political and economic entity which reconciled old foes and would act as a guarantor of peace & prosperity in the continent (in his own words, a “United States of Europe”); in time, this European fellowship would be known to us as the European Union. Churchill was instrumental, and the key driving force, behind the creation of the Council of Europe, a forerunner of what is now the European Union. He is credited as one of eleven Founding Fathers of the Union. Churchill incarnated like no other the best of British values. A child of the House of Commons, he was a proud servant of the State, never its master. A true statesman that would always put ahead of any consideration the best interests of our people, by tearing down divisive walls and fostering at every opportunity union.

Simply put, he’s likely the finest British politician statesman ever to grace 10 Downing Street.

 

At LNA we can assist you buying, selling or renting out your property in Spain. We have 18 years’ experience in conveyance & tax. We are also specialized in Immigration & Residency permits.

Larraín Nesbitt Abogados, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, residency, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88, or by completing our contact form to book an appointment.

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Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

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