I have decided to buy a property in Spain. After visiting several properties, I have decided to buy a country house. The owner has told me that for tax reasons, he does not want to declare the real price of the sale and has established, as absolute requirement, to include a price below the real value in the title deed.
Should I be wary of his stance?
In principle, it seems that there is no other reason rather than saving on taxes. It is obvious that this would constitute fraud, although depending on the circumstances of the case and the amount that would not be declared, the tax administration might not be aware of it. In any case, if you were very interested in the property, you can always settle the tax according to the tax value of the property, and not the sale price.
Actually, the tax regulation establishes that when settling the tax, it must be done according to the higher value, no matter if it is the price appearing in the deed or the tax value. If in this case, the tax value is higher than the sale price, you must calculate the tax according to this value.
Nevertheless, when buying a property in Spain, and especially if it is in the countryside, it is highly advisable to hire the services of a lawyer to make sure that everything is done correctly, in order to avoid any kind of problems.