BLACK MONEY PROBLEMS

Remember when everyone was posting about Black Money, well if anyone has any of it left please put it in a large Jiffy Bag and PM me for my address.

Think everyone sent it to Lehman Brothers already

Or perhaps the Saudis now that oil is down to 45$ a barrel - I am sure they are struggling to make ends meet.

More money more problem, I need me some black money, is that oil?

An interesting new opposite starting to rear its ugly head - in terms of over declaration.

Thus a higher purchase price is declared than is actually being paid so that the buyer can try to procure a higher mortgage based on the purchase contract price................hmmmmmm. I guess it begs the question ..... is this fraudulent practice........ hearing instances of it more and more......will this be the new "its the way its always been"

Is the black money real?

I search about this in google but found less

information.

How can I get  this? Where did it came from? 

It is all hogwash. It is a huge scam. There was never any Black Money. Forget about you ever read about it. See Article below.

http://www.fin24.com/Economy/Black-dollars-scam-victim-shocked-20150320

Ow, as I thought,

:) thanks dude :)

The thread actually relates to what was known at the time as Black Money in Spain where an under declaration was made on the purchase price of a property - i.e. a lower figure was in the official paperwork than the price actually paid (and I can assure you it did exist with significant sums of money being passed between purchaser and vendor in the Notary's office on the day of completion). The benefit to both vendor and purchaser was that there were less taxes owed on tens and sometimes hundreds of thousands of Euros. "The right way the wrong way and the Spanish way!"

The entire process has now been eradicated with heightened money laundering restrictions and a Spanish economy that teetered on the brink of collapse with a reduction in EU Gravy Train subsidies.

Someone better rush out and tell those vendors who refused to sell to us without paying them cash in a little envelope so they can under declare that the whole process has been eradicated.

It's seems some have missed the memo.

Exactly right Starfox.

I suspect the only reason black money has been eradicated is because it's done without the knowledge of the people who are worried about the use of it.

It's a fool who turns down any deal in cash or part cash because of ethics, would anyone risk the loss of the  deal on this basis?

I suspect, if it has been eradicated, it is because it is hard enough convincing Hacienda that one really did pay as little as they really did for a property. 

But for those in any doubt, I know personally that it did exist in 1983 when I bought my first property here and was still going strong in 2002 when I last sold and then bought my present property.  If`property prices ever get back to anywhere near they were in 2007, then I have no doubt the system will be up and running again.

Well I guess you can never account for a corrupt Notary or lawyer - or even those people willing to risk parting with cash outside the realms of the Notary with nothing to secure the transaction - but I am aware of at least three instances during 2009 and 2010 where arrests were made at Notary of vendor and purchaser alike for attempted fraud involving an attempted under declaration and cash payment.

Certainly these days if a mortgage is involved the banks themselves will advise the authorities of an attempted fraud  

Of course, if you did seriously under-declare at the time of purchase and then sell without the corresponding amount of black money involved in the transaction, you could well now find yourself on the wrong end of hefty capital gains tax bill on a profit that you haven't actually made. Reducing transfer tax by using black money only ever really made sense with the assumption that the system would always remain the same.

How times have changed!

By the way, long time no see, Smiley. Sleepover? 

It's still goes on.  I know someone who agreed a purchase of a property in Murcia last year from a Spanish woman and having agreed everything she told him that she wanted part paid in cash to under declare the sale price.  He refused and she tried to persuade him saying "this is the Spanish way".  He still refused and a week or so later was told that the deal had fallen through, allegedly she had a better offer from a Spanish purchaser.

I don't know the detail, but it seems to me that paying tax is not part of the Spanish culture.

I'm not sure that paying tax is part of anyone's "culture" ;-) although most of us will make ourselves as tax efficient as possible......without doubt the "B" has been an accepted part of Spanish property purchase since property tax was invented......I recall a time in the UK when one would purchase the property and purchase the fixtures and fittings separately to avoid stamp duty. 

I am sure that there are still occasional instances where it happens but Hacienda is watching everything a lot more closely (you cant even do 81kph in 80 speed limit without getting fined if youre caught because theyre desperate for money) and it is nothing like the wholesale "B" transactions of the late 90s and early 00's. Too many Notaries have been fined or worse too many lawyers have been fined or worse. As Roberto says anyone who engages in the fraud in this day and age is making HUUUUUUUGE problems for themselves - Hacienda talk to the Land Registry and when it comes to collecting taxes Spanish inefficiency disappears like water from a bath.

And Roberto my old friend - yes a sleeping giant has awoken although it was only because I received a notification that someone had commented on this thread - life is way too short to spend all my life on property forums and if youre inviting just like my friends Alan Shore and Denny Crane I am always up for a sleepover 

I reckon that paying less CGT than they should is a matter of pride for the Spanish.  They had years of vanilla envelopes passing hands at the Notary's office and old habits die hard. 

I purchased a property a few years ago when my solicitor made exactly the same comment "it's the Spanish way" and I really had to insist that there was no funny business.   You get the impression it's like a game for the locals and all the so called "professionals" happily join in.

I cannot surely be the only person who has encountered this?!

But recently I've heard of purchasers being hit with a "Plus Valia" tax if that's the right name, where the Hacienda reckon that the purchase price was too cheap and clobber the purchaser with a special tax based on their assessment of the true market value.  Clearly their way of helping the property market recover, not.

Absolutely correct Acer - where a genuine transaction is taking place with everything above board Hacienda are looking at the Catastral Value of the property and making their own assessment on whether a further charge for transfer tax should be incurred - some lawyers have had some success in advising Hacienda in advance of the transaction and have acquired a certificate confirming a genuine transaction at reduced price is taking place and have managed to get the catastral based tax waived but its a very grey area

An interesting new opposite starting to rear its ugly head - in terms of over declaration.

Thus a higher purchase price is declared than is actually being paid so that the buyer can try to procure a higher mortgage based on the purchase contract price................hmmmmmm. I guess it begs the question ..... is this fraudulent practice........ hearing instances of it more and more......will this be the new "its the way its always been"

I had something similar happen to me. The bank did their own valuation and came up with a massively inflated figure (more than double the catastral value)  and said that they would base their mortgage decison on that. I think they were desperate to sell.