BENALMADENA Council must pay back €41,000 in capital gains tax.
A court has ordered Benalmadena Council to pay back €41,000 in capital gains tax.
The council must now pay back €41,296 to one resident after it was found that when she sold her property in 2014 she did so below market value.
After a court case, the Superior Court of Justice of Andalucia (TSJA) sided with the resident, saying the tax did not have to be paid when it is shown that there has been no gain.
The capital gains tax is a tax levied on the theoretical rise in a property’s value when it is sold and until a ruling in May 2017, taxpayers had to pay out even when value had fallen.
A Malaga court had initially upheld the council’s claim to the tax, while the TSJA has now ruled Benalmadena must pay back the sum to the resident.
In its judgement, the court found the council had a “defect” in automatically applying the tax, “without having exhausted its burden of proving the reality of the tax administration.”
Miguel Maldonado, the lawyer who handled the case, said: “The ruling has an impact on something that the Constitutional Court already made clear in 2017, and that is that the municipalities must prove that this increase has occurred, something that the vast majority are not doing, causing defencelessness and improper collection of capital gains from many people.”
Benalmadena must now pay back €41,296.
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