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17 April 2024 · Neus Vallara

What’s the difference between aggregation and grouping?

What’s the difference between aggregation and grouping?

17 April, 2024
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Real Estate
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Neus Vallara

!Agrupació i agregació

Aggregating and grouping two or more properties is not the same. In this article, we explain the differences between one figure and the other and show you some simple examples.

Aggregation

Aggregation takes place when one or more properties are added to a larger one, which must have an area representing at least five times the sum of those being aggregated.

The registration of the resulting property from the aggregation will be made on the larger property, without altering its registration number. Also, even if the surface is modified after aggregation, the resulting property will also maintain the cadastral reference of the larger property.

Regarding taxation, aggregation will be subject to the Property Transfer Tax and Documented Legal Acts, in its Documented Legal Acts modality, with the taxable base being the value of the properties that have been aggregated.

Let’s look at a simple example:

It is intended to aggregate properties A and B to property C, which are described below:

  • Property A, a plot of 150 m2 with a cadastral reference ending in 03TB and valued at €10.000. Registered in the Property Registry with registration number 11.200.
  • Property B, a plot of 200 m2 with a cadastral reference ending in 08HG and valued at €15.000. Registered in the Property Registry with registration number 11.201.
  • Property C, a plot of 2,450 m2 with a cadastral reference ending in 04RF and valued at €175.000. Registered in the Property Registry with registration number 11.202.

    • Properties A and B together have an area of 350 m2. Thus, since property C has an area representing seven times the area of properties A and B (more than the required quintuple minimum by law), aggregation is possible.

    The property C, once properties A and B have been added to it, has the following description:

  • Property C, a plot of land with an area of 2.800 square meters, valued at 200.000€. The property maintains the cadastral reference ending in 04RF, although its surface area may have been modified, and retains the registration number 11.202 in the Property Registry.

    • Regarding taxation, aggregation will be subject to the Documented Legal Acts modality, with the taxable base of the tax being the value of the properties being aggregated, that is, €25.000 (€10.000 from property A and €15.000 from property B).

    If the requirements for aggregation are not met, grouping will be necessary

    Grouping takes place when a new property is formed from others, which may belong to different owners, provided that the undivided share that corresponds to each of them in the resulting property from the grouping is determined according to what is stated in the title. A new registration number and cadastral reference will be assigned to the new property.

    Regarding taxation, grouping will be subject to the Property Transfer Tax and Documented Legal Acts, in its Documented Legal Acts modality, with the taxable base being the value of the property resulting from the grouping.

    Let’s see another simple example:

    It is intended to group properties A, B, and C, which are described below:

  • Property A, a plot of 150 m2 with a cadastral reference ending in 03TB, valued at €10,000. Registered in the Property Registry with registration number 11,200.
  • Property B, a plot of 200 m2 with a cadastral reference ending in 08HG, valued at €15,000. Registered in the Property Registry with registration number 11,201.
  • Property C, a plot of 1,000 m2 with a cadastral reference ending in 05FT, valued at €70,000. Registered in the Property Registry with registration number 11,203.

    • Properties A and B together have an area of 350 m2. Thus, since the area of property C does not represent at least five times the area of properties A and B, aggregation is not possible. Consequently, grouping must be carried out.

    The resulting property from the grouping is as follows:

  • Property D, a plot of 1,350 m2 with cadastral reference 06NV and registered in the Property Registry with registration number 11,204 (new cadastral reference and new registration number), valued at €95,000.

    • Regarding taxation, grouping will be subject to Documented Legal Acts, with the taxable base of the tax being the value of the property resulting from the grouping, that is, €95,000.

    In conclusion, although aggregation is more advantageous for tax purposes, the requirements for it to be carried out are not always met, so grouping must be carried out in some cases.

    At MES Advocats, we offer comprehensive advice and support in grouping, aggregation, and division of all types of properties. If you need more information or are interested in getting a quote, you can contact our real estate law department at this link.

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    AggregationGroupingCadastreregistro de la propiedad

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