A Court in Alicante Orders SUMA to Refund Overcharged Property Tax for a Loss-Making Sale

The Administrative Court No. 4 of Alicante has ruled in favor of a resident who demanded a refund from SUMA Tax Management for the municipal property tax paid after selling his home at a loss. The judge upheld the appeal filed by the citizen and ordered the provincial administration to annul the tax assessment and refund the amount charged, including the corresponding interest.

The affected individual, represented by lawyer Carlos Rivero Bernal, purchased the property for 83,000 euros and later sold it for 65,000 euros, clearly incurring a loss in value. Nevertheless, the autonomous body of tax management of the Alicante Provincial Council issued a tax assessment for the increase in urban land value (IIVTNU), amounting to 1,720 euros.

The judge determined that there was no increase in value to justify the tax, and therefore, the assessment should not have been made. In her ruling, she also noted that the Supreme Court, in a February 2024 judgment, allows for the review of even firm municipal property tax assessments when unconstitutional provisions were applied and no real gain existed.

Until now, SUMA and other tax authorities refused to review such firm assessments, arguing they could not be reopened. However, the Supreme Court established that it is possible through the official review procedure provided in the General Tax Law, as long as there is no final judgment involved.

The Alicante court's decision directly applies this doctrine, stating that the administration "should have revoked the assessment" and refunded the taxpayer for the amount improperly paid.

The ruling does not impose costs on either party and is final, meaning no appeal is possible, so SUMA must proceed to refund the improperly charged amount along with legal interest.

This ruling may open the door for other residents in the province of Alicante to claim refunds of municipal property taxes in similar cases, especially in transactions where the property's sale value was lower than the purchase price.

The decision reinforces the judicial trend that limits the collection of property tax when there is no real gain and expands the possibilities for review even for cases already closed administratively.