Investing in Spanish property: ITP, tax and plusvalía
How a Spanish purchase is taxed: regional transfer tax, the reference value the tax office rates you on, and the exit tax on the land under your flat.
Updated on 9 August 2026.
What does a Spanish purchase cost above the price?
Between 8% and 12% of the price, and which slice dominates depends on the region. ITP, the Spanish transfer tax, is set by each autonomous region: Madrid charges 6%, Andalucía 7% and the Comunidad Valenciana 9% (2026). Notary, land registry and legal support follow. Estate agent commission is not in that list, because in Spain the seller pays it.
ITP: seventeen regions, seventeen rates
ITP applies to resale property in Spain and is a regional tax. The Netherlands has one national rate; Spain has seventeen. Two identical €400,000 flats, one in Madrid and one in Cataluña, differ by more than €16,000 in tax alone.
Six regions charge in bands rather than at one flat rate. Each slice of the base then falls in its own rate, in the way UK stamp duty works.
| Region (2026) | Resale rate | What it means |
|---|---|---|
| Madrid | 6% flat | €24,000 on €400,000 |
| Canarias | 6.5% flat | The lowest rate outside Madrid |
| Andalucía | 7% flat | €28,000 on €400,000 |
| Comunidad Valenciana | 9% flat | Cut from 10% in mid-2026 |
| Cataluña | 10% to €600,000, rising to 13% above €1.5m | €40,000 on €400,000 |
| Islas Baleares | 8% to €400,000, rising to 13% above €2m | Banded, not flat |
| National fallback | 8% | What BRIX Calc uses without a region |
Rates as at 3 August 2026, from the BRIX Calc Spanish ruleset. Regions revise them yearly, so confirm with the tax office of the region itself.
The valor de referencia: negotiating hard does not cut your tax
The valor de referencia is a reference value the Catastro publishes for each Spanish property. Since 1 January 2022 it has been the minimum base for ITP and AJD (Ley 11/2021). Buy below it and the tax office still charges on the reference value.
That is the reverse of most markets, where the price you agree is the base. In Spain a sharp negotiation lowers your price but not your tax bill. Look the reference value up at the Catastro before you bid, not after you have signed.
Non-resident income tax: EU and non-EU are taxed differently
A non-resident landlord in Spain pays income tax under the IRNR regime, and the treatment splits on residence. A resident of an EU or EEA state pays 19% on net rent, after allowable expenses. A resident of a country outside that group pays 24% on gross rent, with no deductions at all.
| Landlord resident in | Rate | Base |
|---|---|---|
| An EU or EEA member state | 19% | Rent after allowable expenses |
| A country outside the EU and EEA | 24% | Gross rent, no deductions |
That distinction has repriced Spanish buy-to-let for British buyers since Brexit. The same flat, the same tenant and the same rent produce a materially different net return depending on where the owner files. Run the number both ways before you assume a yield.
Plusvalía municipal: the exit tax on the land under your flat
Plusvalía municipal is a local tax on the increase in the land value under your property, due when you sell. Since the Constitutional Court ruling in 2021 two methods exist, and you pay the lower of the two.
The objective method ignores your actual profit. It takes the cadastral land value, multiplies it by a coefficient that depends on your holding period, and applies the municipal rate, capped by law at 30% (2026).
plusvalía objetiva = €72,000 × 0.20 × 30% = €4,320
The real method looks at your gain and taxes only the land share of it. Which one wins depends entirely on how well the sale went.
| Method after seven years | Outcome | What it means |
|---|---|---|
| Objective, land value €72,000 | €4,320 | Independent of your profit |
| Real, gain €60,000, land share 50% | €9,000 | More expensive, so objective wins |
| Real, gain €18,000, land share 50% | €2,700 | Cheaper, so real wins |
| Sale at a loss | €0 | No increase in value, no charge |
BRIX Calc only runs the objective method if you enter the cadastral land value alone. Add the total cadastral value and it works out both and takes the lower one.
New build or resale: two regimes that exclude each other
Resale and new build are mutually exclusive in Spain. Buy from a private seller and you pay ITP. Buy directly from a developer and you pay VAT plus stamp duty, and no ITP. On the Canary Islands, IGIC replaces VAT.
| Tax (2026) | Base | Rate |
|---|---|---|
| ITP, resale | Higher of price and valor de referencia | 6% to 13%, by region |
| IVA, new build, mainland | Price | 10% |
| IGIC, new build, Canarias | Price | 7% |
| AJD, new build | Higher of price and valor de referencia | 0.5% to 1.5% by region |
Worked example: a €265,000 apartment in Alicante
A resale apartment in the Comunidad Valenciana with a valor de referencia of €278,000. You buy below that value, so ITP is charged on the reference value.
| Item | Amount | What it means |
|---|---|---|
| Purchase price | €265,000 | What you pay the seller |
| ITP base | €278,000 | €13,000 above your price |
| ITP at 9% (2026) | €25,020 | €1,170 more than on the price |
| Notary, RD 1426/1989 scale | €782 | Sliding scale, not a flat percentage |
| Land registry, RD 1427/1989 scale | €257 | Capped by law at €2,181.67 |
| Legal and gestoría at 1.0% | €2,650 | Market rate, not a statutory fee |
| NIE application and power of attorney | €350 | You cannot complete without an NIE |
| Total acquisition costs | €29,059 | 11.0% of the price |
Rent is €1,250 a month, so €15,000 a year. Operating costs: community fees €1,320, IBI €480, insurance €290, management €1,200, maintenance and vacancy €1,500, waste charge €95. Net operating income is €10,115 on a total investment of €294,059, a net yield of 3.4%.
| Landlord | Annual Spanish tax | What it means |
|---|---|---|
| Resident of an EU or EEA state | €1,922 | 19% of €10,115 net |
| Resident outside the EU and EEA | €3,600 | 24% of €15,000 gross |
| Difference | €1,678 | 16.6% of your net operating income |
Model your own price, region and rent in BRIX Calc. It applies the regional ITP, the statutory notary and registry scales and the plusvalía at exit. Then check the net yield it produces, or compare Spain with six other markets in international property investment.
Frequently asked questions
Do I pay ITP or VAT on a new build in Spain?
On a new build from a developer you pay VAT plus AJD, and no ITP. On the mainland the VAT rate is 10%, and on the Canary Islands IGIC applies at 7% (2026). AJD runs between 0.5% and 1.5% depending on the region. The two regimes exclude each other.
What happens if I buy below the valor de referencia?
The Spanish tax office charges ITP on the reference value anyway. It has been the minimum base since 1 January 2022 under Ley 11/2021. You can challenge the figure, but the burden of proof sits with you. In the worked example above it adds €1,170.
Why does a British landlord pay more than a German one?
Because the IRNR rate splits on residence, not on the property. A resident of an EU or EEA state pays 19% on net rent; everyone else pays 24% on gross rent with no deductions. Since Brexit, UK residents fall in the second group. The gap in the example is €1,678 a year.
How much plusvalía municipal will I pay when I sell?
It depends on the cadastral land value, your holding period and the municipal rate, which is capped by law at 30% (2026). You pay the lower of the objective and the real method. Sell at a loss and you owe nothing. Ask the town hall for the coefficient that applies.