SpainProperty Tax Overview in Spain
Last reviewed: · by TaxProsRated editorial
Key points
Spain levies five overlapping property-related charges: annual IBI (municipal tax at 0.4-1.1% of cadastral value); the reformed plusvalia municipal on land-value gains at sale; ITP (6-11%) on resale or IVA 10% plus AJD on new builds; non-resident imputed income (IRNR) at 1.1-2% of cadastral value even on vacant second homes; and Wealth Tax on net assets above EUR 700,000.
Spain imposes property-related taxes at three levels of government: the national legislature sets frameworks for income and wealth taxes, autonomous communities administer and set rates for transfer taxes, and local councils (ayuntamientos) levy the annual municipal charge. Owners, buyers, and non-residents each face distinct obligations that can overlap in a single tax year. Spain country overview provides a broader context for all Spanish tax matters.
What is the IBI annual municipal property tax?
The Impuesto sobre Bienes Inmuebles (IBI) is levied annually by each local council on the cadastral value (valor catastral) of real estate. The legal framework is Real Decreto Legislativo 2/2004, which sets the statutory rate bands for municipalities: 0.4% to 1.1% for urban properties and 0.3% to 0.9% for rural properties. Each council chooses its own rate within those bounds. Major city examples illustrate the spread: Madrid levies roughly 0.456%, Barcelona roughly 0.66%, Valencia roughly 0.73%, and Malaga roughly 0.72%.
Cadastral value is set by the Direccion General del Catastro and is typically 50-70% below market value, so the effective IBI rate on fair market value generally runs 0.2-0.5%. IBI is billed once per year, with payment windows varying by municipality -- most fall between August and November. The registered owner as of 1 January of the tax year is the liable party; a sale during the year does not legally pro-rate the charge, though purchase contracts frequently apportion IBI between seller and buyer for the months after transfer by private agreement. Since 2023, councils may also levy a surcharge of up to 150% of the standard IBI rate on residential properties that have been continuously vacant for more than two years.
How does the plusvalia municipal work after the 2021 reform?
The Impuesto sobre el Incremento de Valor de los Terrenos de Naturaleza Urbana (IIVTNU), commonly called plusvalia municipal, is a local charge triggered by any transfer of urban land -- sale, gift, or inheritance. In October 2021, the Constitutional Court (Sentence 182/2021) struck down the previous calculation methodology as disproportionate, ruling it could impose tax even when no real gain was made on the land component. Royal Decree-Law 26/2021, in force from 10 November 2021, replaced it with a dual-method regime.
Sellers (or heirs) may now elect whichever calculation produces the lower liability: the objective method multiplies the cadastral land value by an official coefficient tied to the number of years the property was held, then applies the municipal rate (maximum 30%); the real-gain method uses the actual difference between sale and acquisition prices, attributed proportionally to land rather than buildings, then applies the same rate. If neither method produces a positive land gain -- including outright loss disposals -- no plusvalia is owed, but the taxpayer carries the burden of documentation. The charge is filed with the local ayuntamiento within 30 days of the transfer deed.
What are the purchase taxes on resale versus new-build property?
The tax framework distinguishes sharply between acquiring a resale property and buying a new build from a developer.
Resale (second-hand) purchases trigger the Impuesto sobre Transmisiones Patrimoniales (ITP), a regional transfer tax set by each autonomous community. Rates across Spain currently range from 6% (Madrid, La Rioja) to 10-11% (Cataluna, Extremadura). The buyer pays ITP via Modelo 600 (or regional equivalent) within 30 days of signing the public deed (escritura publica) before a notary.
New-build purchases from developers are instead subject to IVA at 10% on the purchase price (4% for officially protected social housing, Vivienda de Proteccion Oficial), invoiced by the developer, plus AJD (Actos Juridicos Documentados, stamp duty) at regional rates of 0.5% to 1.5%. Madrid charges 0.75% AJD; Cataluna charges 1.5%. The total tax loading on a new build therefore runs approximately 10.5-11.5% in most regions.
| Transaction type | Main tax | Rate range | Who pays | Authority |
|---|---|---|---|---|
| Resale purchase | ITP | 6-11% of price | Buyer | Autonomous community |
| New build from developer | IVA | 10% (4% VPO) | Buyer | National (AEAT) |
| New build stamp duty | AJD | 0.5-1.5% | Buyer | Autonomous community |
| Land-value gain at sale | Plusvalia municipal | Up to 30% of land gain | Seller | Local council |
| Annual ownership | IBI | 0.4-1.1% of cadastral value | Owner | Local council |
What is the non-resident imputed income tax on Spanish property?
Non-residents who own a Spanish residential property without renting it out face the Impuesto sobre la Renta de No Residentes (IRNR) on a deemed imputed income under Article 85 of Ley 35/2006 LIRPF and the corresponding LIRNR provisions. The imputed base equals 1.1% of the cadastral value if that value has been revised or updated by collective valuation within the previous ten tax periods, or 2% of cadastral value if no revision has taken place in that window. This base is then taxed at 19% for EU and EEA residents, or 24% for residents of countries outside the EEA (including the United Kingdom following its exit from the EU).
The charge applies per calendar year on each day the property is held but not rented; days on which actual rental income is declared reduce the imputed calculation pro-rata. Filing is via Modelo 210 (income type code 02) with a deadline of 31 December of the year following the tax year -- 2025 imputed income is due by 31 December 2026. The European Commission opened a formal infringement procedure against Spain on this charge in June 2025, arguing it treats non-residents less favourably than residents, whose habitual residence is exempt; the outcome of that procedure may affect future obligations, and a qualified tax professional can advise on current exposure.
How do the Wealth Tax and Solidarity Tax on Large Fortunes affect property owners?
Spain's Impuesto sobre el Patrimonio (Wealth Tax) is levied on the net value of assets held by individuals at year-end. Real estate is valued at the highest of cadastral value, the tax authority's reference value (valor de referencia established since 2022 by Real Decreto Ley 6/2023 via the Catastro), or the acquisition price. The habitual residence is exempt up to EUR 300,000. A EUR 700,000 personal allowance applies before any Wealth Tax is computed. Rates are set regionally; several communities including Madrid, Andalucia, and Cantabria grant 100% relief, effectively zeroing out the charge for their residents.
The Impuesto Temporal de Solidaridad de las Grandes Fortunas (Solidarity Tax, Ley 38/2022 / Model 718), originally introduced as temporary in December 2022 and extended through 2025 and beyond, applies nationally on net wealth exceeding EUR 3,000,000. It uses the same asset-valuation rules as the Wealth Tax and operates as a floor: the amount paid in regional Wealth Tax is credited against Solidarity Tax, so the Solidarity Tax only bites where the regional levy is lower than the national schedule. The Solidarity Tax rates are 1.7% on the tranche from EUR 3 million to EUR 5.35 million, 2.1% on EUR 5.35 million to EUR 10.7 million, and 3.5% above EUR 10.7 million. Property owners in Madrid and other full-relief communities bear the full Solidarity Tax with no regional offset.
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Property taxation in Spain involves multiple overlapping obligations across national, regional, and local authorities. The interaction between IBI, IRNR, ITP, plusvalia, and Wealth Tax means that the total cost of ownership and disposal can differ substantially depending on jurisdiction, residency status, and asset value. A qualified tax professional with experience in Spanish real estate can map the specific charges applicable to a given property, transaction, and owner profile.
Frequently asked
What rate of IBI annual property tax will a typical urban property owner in Spain pay?
IBI rates for urban properties are set by each local council within the statutory band of 0.4% to 1.1% of cadastral value, established by Real Decreto Legislativo 2/2004. Cadastral value is typically 50-70% of market value, so the effective rate on market value generally falls between 0.2% and 0.5%. Madrid charges roughly 0.456%; Barcelona roughly 0.66%; Valencia roughly 0.73%. The bill is issued annually, usually with payment due between August and November depending on the municipality.
How is the plusvalia municipal calculated following the October 2021 Constitutional Court ruling?
Royal Decree-Law 26/2021 replaced the struck-down method with two options: the objective method (cadastral land value multiplied by an official holding-period coefficient, then by the municipal rate up to 30%), or the real-gain method (actual land-value appreciation between purchase and sale, proportioned to land, then multiplied by the municipal rate). The seller elects whichever produces lower tax. If the land component of the transaction shows no real gain or a loss, no plusvalia is due, provided the seller documents it with the transfer deeds.
What is the difference between ITP and IVA when buying property in Spain?
ITP (Impuesto sobre Transmisiones Patrimoniales) applies to resale property purchased from a private seller, at regional rates ranging from 6% (Madrid, La Rioja) to 10-11% (Cataluna, Extremadura). IVA applies when buying a new build directly from a developer, at 10% for standard residential property (4% for officially protected social housing), plus AJD stamp duty of 0.5-1.5% set regionally. ITP and IVA are mutually exclusive: the same property sale cannot attract both.
Why do non-residents in Spain owe income tax on a property they do not rent out?
Article 85 of Ley 35/2006 (LIRPF) and the corresponding LIRNR provisions require non-residents to declare a deemed rental income equal to 1.1% of the cadastral value (if revised within the past 10 tax periods) or 2% (if not revised). This imputed income is then taxed at 19% for EU and EEA residents or 24% for residents outside the EEA. Filing is via Modelo 210 by 31 December of the following year. The European Commission opened an infringement case against Spain on this charge in June 2025.
At what threshold does the Spanish Solidarity Tax on Large Fortunes apply, and how does it interact with regional Wealth Tax?
The Solidarity Tax (Ley 38/2022, filed via Modelo 718) applies to individuals with net wealth above EUR 3,000,000, using rates of 1.7% on EUR 3-5.35 million, 2.1% on EUR 5.35-10.7 million, and 3.5% above EUR 10.7 million. Any regional Wealth Tax paid is credited against the Solidarity Tax liability, so the national charge only produces a net payment where the regional rate is lower than these national rates -- most significantly in Madrid, Andalucia, and Cantabria, which grant 100% regional Wealth Tax relief.
Country overview
Tax in Spain
Important disclaimer
Informational only — not tax advice. This page summarises publicly available information about tax in Spain as of June 2026. Tax laws change, individual circumstances vary, and the application of any rule depends on your specific facts.
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