Legal and tax treatment of real estate operations
The former rapid development and evolution of the real estate market and the current existence of a market for debt restructuring of property assets, as well as the permanent existence of residential housing legal transactions, require an analysis of the tax regime to which all the different operations that currently comprise property trading are subject in terms of indirect taxation (Value Added Tax, Property Transfer Tax and Stamp Duty Tax), including those previously undertaken, within the urban development process.
This is an area on which the economic crisis of recent years has had a particular impact, and in which numerous tax novelties aimed at alleviating and relaunching the real estate sector have been introduced.
In this respect, it is advisable to account for situations such as (i) real estate operation VAT exemption and waiver, (ii) the tax regime of those securities transfer operations that conceal a property transfer, (iii) handovers of properties included in the transfer of all of a firm’s capital equity, (iv) exchanges of land for future building, (v) expropriation operations, (vi) asset transfers undertaken by way of a legal auction, (vii) operations for assignment of receivables or rights to acquisition of properties under construction, (viii) works executions undertaken as a result of the urban development process, (ix) urban development operations carried out via compensation, cooperation and expropriation systems, (x) urban development operations whose beneficiary is a Public Administration, (xi) property leasing, (xii) assignment of the use of properties (timeshare rights), (xiii) transfer in lieu of payment and for payment, (xiv) investment of the VAT taxpayer in certain property sales operations undertaken by persons with a right to deduction, etc.
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