The new reference value in real estate transactions
Real estate transactions will undergo modifications at the beginning of 2022 with the new concept of the reference value. This will consist of the reduction of tax litigation through the valuation of real estate, especially in those litigations that the Administration has been losing.
This value will be the taxable base for those taxes that the company will pay if it buys, inherits or gives them a home,that is, the taxes of ITP-AJD, Inheritance and Donations. Previously, a value that usually matched the price was declared. But if the Administration considered that the value was higher and that more would have to be paid, it was required to prove it. According to the Supreme Court, it would initially be carried out by completely legal, although unethical, means. Therefore, the Court requires an individualized visit to properly value the home.
From now on, even if the price is lower, the taxable base will be the reference value. If the taxpayer is not satisfied with the value, he will have to prove it by judicial means in court. In the case where the reference value is higher, the taxable amount would automatically become the price
How the real estate reference value will be calculated
Cadastre will be in charge of setting the reference value,observing the costs of those purchases of homes that have been made before a notary correctly. The reference value will be calculated through individualized valuations that will take into account the particularities of each of the properties, such as their age or their quality of construction. This value, according to the standard, may not be higher than the market value. In short, it will be the one that we will consider whenever we have to calculate the price for the Wealth Tax of the homes acquired from 2022.
The subjectivity of the value of a property
The price of things is a subjective term that varies according to certain aspects. Aspects such as the reforms carried out, the views of the property or its smell. These are some of the factors that can influence the value of a home that do not appear in the statistics and that are evident in the visits to the property. These ratings may change from person to person. Some appreciate more a good location to be closer to their family nucleus, others the dimensions of the property or the quality of the neighborhood where it is located. However, all these valuations are only an inconvenience when taxes have to be paid, that is, when buying above the reference value. On the contrary, these valuations will never be considered as a positive aspect when buying below the reference value.
There will be those who believe that with the application of this new concept they will know the exact value of a property because Cadastre will fix it. And although it is true that there will always be buyers who agree to pay more than that value and sellers who sell their properties for less, the new reference value will influence the negotiations and possibly cause other unintended consequences:Will small reforms be carried out for the sale of the property, knowing that they will not be reflected in the reference value? Will the hiring of appraisals be reduced after the creation of a free one?