#EmbraceSpain XIII: Hot New Year with flood clauses, IRPF Maternity Claim, #Brexit

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#EmbraceSpain XIII: Hot New Year with flood clauses, IRPF Maternity Claim, #Brexit

The judgments on the floor clauses and on maternity benefits will have enormous effects in Spain and especially the first, also in the United Kingdom.

Two court rulings have topped all the activity in Del Canto Chambers this week: that of the Court of Justice of the European Union (CJEU) on the limitation of retroactivity of the floor clauses and that of the Supreme Court of Justice of Andalusia (TSJA) on The application of the IRPF to maternity benefits.

In this way, as we mentioned in our blog, the European high court refuses to limit the nullity of the floor clauses. This means that those who have signed a mortgage containing such clauses will have the right to have the amounts paid back to the banks refunded from the date of their signature.

Previously, both the Spanish Supreme Court and the Advocate General of the Court of Justice, Paolo Mengozzi (in a non-binding opinion) had considered that banks should only return the amounts of the contracts after May 2013. With this decision, the CJEU recognizes that such returns must occur from the moment the contract is signed.

It is estimated that the verdict on ground clauses could benefit some three million customers who would be returned between 5,000 and 7,000 million euros. And among the affected are many Britons who bought properties in Spain. In order to advise all these people our firm launched the website www.spanishbank.co.uk for those affected by the floor clauses.

On the other hand, the TSJA refuses to leave exempt of the tax of the IRPF to the maternity benefits, following the line of the Tax Agency. The ruling is totally contrary to another ruling issued shortly before by the High Court of Justice of the Community of Madrid (TSJM) that has considered them exempt.

In the case of maternity benefits, between one and two million women are affected. In order to create a pressure group, the platform www.reclamacionmaternidadirpf.com has been launched for those women who wish to claim the Treasury for their maternity benefits

Regarding the economic situation of Spain and the United Kingdom in the final days of 2016, both countries are closing the year with good results although their evolution remains conditioned to the development of Brexit.

Ensuring access to the single EU market and negotiating the new rules of the game is the priority for both UK and European companies. However, it is clear that Brexit will change the nature of the UK’s relations with the European Union. Thus, Liam Fox, Secretary of State for International Trade advocates a UK-EU bilateral regime similar to that of Turkey.

At the moment the British financial sector continues to receive strong foreign investments and, in the case of the real estate market, real estate sales and the rental sector are expected to continue to grow in 2017.

On the other hand, in Spain, the trade deficit has fallen by 27% and is approaching historic lows and the real estate market benefits from the growing activity of the Socimis (Listed Companies of Real Estate Investment), with 1.5 billion euros in acquisitions this year.

Thus, in order not to stop this improvement of the economy, the Spanish Confederation of Business Organizations (CEOE) has advised the government not to raise the corporation tax so as not to discourage the introduction in Spain of foreign companies.

Finally, the European Commission maintained its decision to fine the multinational Apple with 13,000 million euros for tax evasion through Ireland.

In 2017 the consequences of Brexit in Europe can be seen more clearly. Spain and the United Kingdom, the former being one of the Member States with the most weight in the EU and the second, with a community influence in question due to the victory of leave, should not be overcome by the certainty that both are now one and Other side of the community space and try to safeguard, despite the Brexit, the maximum possible of their historical economic and social relations.

This time of Christmas celebrations and winter holidays is a good time, even more, to reflect and plan as #EmbraceSpain will continue to strengthen ties between both countries. As we approach the end of the year, we will keep an eye out for the news that you can follow in our blog, Twitter and Linkedin.

Xavier Nova (@xavinova)

Director of Del Canto Chambers