The Immovable Property Tax (IBI) is the equivalent of the "property tax" in France, the "prepayment of real estate" in Belgium, or the "Council Tax" in the United Kingdom. It is a mandatory annual local tax for any owner of real estate in Spain.

Who's concerned?

Any individual or legal entity owning real estate (residential, commercial, land) in Spain on January 1 of each year.

How is IBI calculated?

IBI is calculated by applying a tax rate to the cadastral value of the property(valor catastral). This value is an administrative estimate of the property's value, often lower than its market value.

• Cadastral value: this is determined by the Town Hall (Ayuntamiento) on the basis of criteria such as location, surface area, age and quality of construction.
  
• Tax rate: set each year by the local council. It generally varies between 0.4% and 1.1% for urban properties, and between 0.3% and 0.9% for rural properties.

Real-life examples of IBI in València

As the owner of three properties in València, here are the actual IBI amounts I pay in 2024:

• 82 m² apartment, Calle Cura Planelles 16, València: €130
• 75 m² apartment, Calle Juan Mercader 12, València: €102
• 52 m² apartment, Calle Carlos Ros 3, València: €120

The amount of IBI changes every year.

Let's take the example of the apartment in Calle Cura Planelles:

• 2019 : 174 €
• 2020 : 171 €
• 2021 : 200 €
• 2022 : 163 €
• 2023 : 159 €
• 2024 : 130 €

Why the upward and downward variations?

This is mainly due to one factor: each year, the local council sets the applicable tax rate(tipo de gravamen), within a range defined by law.

For example:

• In 2020, the rate in València was 0.72%.
• By 2024, it had fallen to 0.57%.

This change in rate can cause the IBI to rise or fall significantly, even if the cadastral value of the property remains the same.

When and how to pay IBI?

• Payment period: varies from town hall to town hall, but is generally between September and November.
  
• Payment methods :
  
  • Online via the town hall website.
    
  • By direct debit.

How do I direct debit my IBI payment?

A little tip from Terreta is to have the IBI payment domiciled, so you don't have to think about it anymore.

To do this, you need to send a request to the town hall, along with a few documents:

• Your NIE
• The "Copia Simple" which proves that you are the owner of the property
• Authorization for domiciliation signed
• RIB (bank details) of the bank account to which you wish to direct payment

For the domiciliation authorization, here is a model that will do the trick, which you must date and sign:

Yo, D./Dña. ____________________________,

con N.I.E. ____________________________ y

D.N.I. ____________________________,

propietario/a de la vivienda sita en

______________________________________________________________________________________,

solicito la domiciliación bancaria para el Impuesto de Bienes Inmuebles (IBI)

para el próximo ejercicio, en la cuenta con IBAN: ______________________________.

In________________, a ____ of ___________________ of 20.

Firma: ____________________

Here is a sample email to send to the town hall, for example for València to ayuntamientovalencia_gti@valencia.es:

"Buenos dias,

Adjunto los documentos siguientes para domiciliar el IBI de mi vivienda situado en la dirección siguiente _____________________ Valencia :

• NIE
• Copia Simple
• Acreditación de titularidad bancaria
• Solicitud de domiciliación firmada

Gracias de antemano,
Un saludo"

For any other city, please do the following search on Google or ChatGPT "domiciliar pago ibi", and add the name of the city. You'll find the procedure.

What does the IBI document look like?

Here's an example of IBI, so you can see what the document looks like.

Important points for foreign investors :

• Checking the IBI: when buying a property, make sure that the IBI is up to date. The seller must provide proof of payment for the last few years.
  
• Consequences of non-payment: late payment penalties and interest apply in the event of non-payment. The mayor's office may also initiate seizure proceedings.
  
• Possibility of appeal: if you feel that the cadastral value of your property is excessive, you can lodge an appeal with the town hall.