Q&A this week deals with Views and Taxes and selling in Spain
What to do about my view?
I bought an apartment in January in an established residential area. It's in a 10-year-old block and one of the big attractions for me was the view across the mountains and the peaceful, open surroundings. I have since discovered that a house adjacent to my apartment is to be knocked and planning permission has been secured to build another apartment development on the site. The development is the same height as my block so my views are seriously compromised. I was not aware of this when I bought and would not have gone ahead with the sale had I known I was to be so hemmed in. Do I have any comeback?
Well, comeback against who, exactly? Buying property is perhaps the ultimate example of "buyer beware". All the way along the line you will find that every professional involved with the transaction is protected so that it really is up to you to make sure that what you are getting is what you want.
It is likely, for example, that in the sales brochure the agent made a point of the views from your livingroom window, but you'll also notice a disclaimer in the small print on the back page of the brochure. When buying property, buyers tend to rely too much on the agent when the agent is at all times concerned with the best interests of the seller.
Even if the apartment owner told you directly about how fantastic the view is, he or she might genuinely not know about the planning issue and it would be very difficult to prove that they did and that they in some way sold the apartment to you under false pretences. Any buyer in Dublin would be well advised to take a close look at any piece of land adjacent to their desired property. The move towards higher densities even in suburban areas has meant that small plots of land - and that includes detached houses that could be knocked and built on - are being eyed for development.
A call to the planning department of your local authority could have told you about the planning permission before you went through with the sale.
Tax and selling in Spain
This summer I intend to sell my Spanish holiday apartment - I did not use it as much as I originally imagined and never wanted the hassle of renting it. It has gone up by an estimated 20 per cent since I first bought it. As it was not rented out, does it still count as an investment and how will any profit I make be viewed for tax purposes?
As your Spanish property is not your primary residence then it is an investment property - an apartment does not have to be a rental for it to be considered an investment. As you will in all likelihood make a profit, Spanish tax will be payable at 35 per cent of the taxable gain, broadly the sale proceeds, less original cost, and allowable costs of acquisition and disposal.
Irish capital gains tax would also be payable at the rate of 20 per cent, which is calculated on a similar basis.
However, there is a double taxation agreement between Spain and Ireland so you will not be taxed twice on the gain as the Spanish tax can be offset against the Irish tax.
Send your queries to Property Questions, The Irish Times, 10-16 D'Olier Street, Dublin 2 or e-mail propertyquestions@irish-times.ie.
Unfortunately, it is not possible to respond to all questions. The above is a representative sample of queries received. This column is a readers' service and is not intended to replace professional advice. No individual correspondence will be entered into.
