How to calculate the Municipal Capital Gains Tax in Puerto del Rosario

How to calculate the Municipal Capital Gains Tax in Puerto del Rosario

When we sell a property, one of the taxes that comes into play is the Plusvalia municipal, a local tax levied by the local councils that is levied on the sale of the property. tax is levied on the increase in value that land has experienced in which the properties are located during the time we have been in possession of the properties.

However, the Municipal Capital Gains Tax is not a tax that is payable only in cases of purchase and sale. Its liquidation occurs whenever a property changes ownership, so it also affects the transfer of homes through inheritance and donation.

But, how much is the Municipal Capital Gains Tax paid? How is the Municipal Capital Gains Tax calculated in Puerto del Rosario?

Calculate the Capital Gain in Puerto del Rosario

There are two different systems for calculating the tax on the Increase in Value of Urban Land:

  • Objective Estimation
  • Estimated Actual Goodwill

Below we will explain step by step how to calculate the Plusvalia Municipal in Puerto del Rosario with each of the available systems so that you can choose the one that is most economical for you.

Likewise, we also want to give you access to a Municipal Capital Gains Calculator in Puerto del Rosario so that you can perform the calculation automatically. Download the Excel template below, fill it in with the data related to your property and calculate the amount that you will have to pay for the Municipal Capital Gains Tax (Plusvalia Municipal).

Municipal Capital Gains Calculator [Puerto del Rosario]

Capital Gains in Puerto del Rosario: Actual Capital Gains Estimate

The first system we can choose to calculate the Municipal Capital Gains in Puerto del Rosario is the Real Capital Gains Estimate. This method takes into account the capital gain obtained with our transaction when calculating the tax. We show you step by step:

1º Calculate the Equity Gain

To know what we will have to pay in concept of Increase of Value of the Lands of Urban Nature in Puerto del Rosario by means of the method of Real Capital Gain, we begin calculating the Patrimonial Gain that we have experienced with our real estate transaction.

To do this, we subtract the value for which we acquired the property from the value for which we are selling it today.

Let’s take an example:

If we bought our house in Puerto del Rosario for 110,000 euros and today we are going to sell it for 140,000 euros, the capital gain that we will obtain will be 30,000 euros.

2º Calculate the Taxable Base

Next, we multiply the Patrimonial Gain obtained by the percentage that the cadastral value of the land represents over the total cadastral value of the property (this information can be found in your last IBI receipt). This operation will result in the Taxable Tax Base.

Continuing with our example:

If the percentage that the cadastral value of the land represents over the total cadastral value of the property is 60%, we will have to multiply this figure by the capital gain experienced, i.e. by 40,000 euros. This will result in a taxable income of 24,000 euros.

3º Apply the Tax Rate

Now we will only have to apply to the Taxable Base obtained from the previous point, the Tax Rate established by the Town Hall of Puerto del Rosario. This value will depend on the number of years in which we have been in possession of the property before the sale:

Years between purchase and sale Tax Rate
Up to 5 years 25%
Up to 10 years 22%
Up to 15 years 20%
Up to 20 years 19%
Tax rates to be applied in Puerto del Rosario for the calculation of Capital Gains.

Continuing with our example:

If we take into account that 6 years have passed since the purchase and until the sale of our home, according to the tables defined in the regulations governing the Municipal Capital Gains of the City Council of Puerto del Rosari24,000 euros, we will have to apply a tax rate of 22% to the taxable income (24,000 euros). This will give us a final tax liability of 5,280 euros .

“According to the Plusvalia Real method we will have to pay 5,280 euros for the Plusvalia of our home.”

Capital Gains in Puerto del Rosario: Objective Assessment

The Objective Estimation is the other system we can opt for when calculating the Municipal Capital Gain in Puerto del Rosario. This method takes into account the years elapsed between the acquisition and the transfer of the property to determine the tax. Here is a step-by-step explanation.

1º Calculate the Taxable Base

The first step to determine what we will have to pay for the Increase in Value of Urban Land in Puerto del Rosario is to apply to the cadastral value, the corresponding multiplication coefficient according to the years elapsed between the purchase and the sale of the property. We remind you that you can know the cadastral value of the land in the last receipt of the IBI.

According to the local regulations of Puerto del Rosario, the multiplication coefficients to be applied in this municipality are determined as follows:

Years elapsed between purchase and sale Multiplication Coefficient
Less than 1 year 0,14
1 year 0,13
2 years 0,15
3 years 0,16
4 years 0,17
5 years 0,17
6 years 0,16
7 years 0,12
8 years 0,10
9 years 0,09
10 years 0,08
11 years 0,08
12 years 0,08
13 years 0,08
14 years 0,10
15 years 0,12
16 years old 0,16
18 years old 0,26
19 years old 0,36
20 years or more 0,45
Multiplication Coefficients to be applied to Capital Gains in Puerto del Rosario

Let’s take an example:

Let’s imagine that we are going to sell a house in Puerto del Rosario that we bought 6 years ago and whose land value is 60,000 euros. According to the City Council tables, the Multiplication Coefficient to be applied to the land value is 0.16%. This will give us a taxable income of 9,600 euros.

2º Apply the Tax Rate

Once we have the Taxable Base, the next step is to apply the corresponding Tax Rate according to the number of years in which we have been in possession of the property. We remind you that the tax rates in Puerto del Rosario are determined as follows:

Years between purchase and sale Tax Rate
Up to 5 years 25%
Up to 10 years 22%
Up to 15 years 20%
Up to 20 years 19%
Tax rates to be applied in Puerto del Rosario for the calculation of Capital Gains.

Continuing with our example:

The tax rate that corresponds to a transfer of a property that we have owned for 6 years will be 22%. Thus, if we apply this tax rate to the taxable base (9,600 euros) we will have a final tax liability of 2,112 euros.

According to the objective estimation system, we will have to pay 2,112 euros for the capital gain on our property.

Which system is cheaper?

Therefore, which of the above methods is the cheapest when calculating the Plusvalia Municipal in Puerto del Rosario? According to our example, the most economical system is the objective estimation method, since it gives us a final Tax Quota of 2,112 euros as opposed to the 5,280 euros that we will have to pay if we opt for the Real Capital Gain estimation system.

However, this does not always have to be the case. Everything will depend on the capital gain obtained with the real estate transaction and the years elapsed between the acquisition and the transfer of the property.

If you are not sure which is the most advantageous method in your case, you can use the Municipal Capital Gains Calculator in Puerto del Rosario. Download the Excel file below and calculate the Plusvalia Municipal of your property automatically to find out how much you will have to pay for this tax.

Municipal Capital Gains Calculator [Descargar]

The Municipal Capital Gains Tax is a local tax levied on the increase in value of urban land during the time it has been owned by the owner. It is liquidated when a property changes ownership, whether by purchase, sale, inheritance or donation.

There are two methods to calculate the Plusvalia Municipal in Puerto del Rosario:

  • Estimated Actual Capital Gain: It is calculated based on the capital gain obtained from the transaction. First, the capital gain (difference between the acquisition value and the sale value) is determined. Then, it is multiplied by the percentage of the cadastral value of the land over the total value of the property, and finally, the tax rate corresponding to the period of possession of the property is applied.
  • Objective estimation: It is calculated by applying a multiplication coefficient to the cadastral value of the land according to the years elapsed between the purchase and the sale, and then the corresponding tax rate is applied.

To calculate the Plusvalia Municipal, you need:

  • The acquisition value and the sale value of the property.
  • The cadastral value of the land, which you can find in the last IBI receipt.
  • The years elapsed between the purchase and sale of the property
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