The Impuesto sobre Transmisiones Patrimoniales (ITP), or Property Transfer Tax in English, is an unavoidable tax in the real estate purchasing process in Spain.
It often represents a significant portion of the total transaction cost, potentially reaching up to 11% of the property value. Understanding this tax is essential to avoid unpleasant financial and legal surprises.
A regional tax
Spain is composed of 17 autonomous communities, each applying its own ITP rates. Some regions, such as Madrid or Andalusia, adopt low rates to attract investors.
Here are the ITP rates applied in 2024, in alphabetical order by region.
- Andalusia: 7%
- Aragon: 8% to 10% (progressive rate)
- Asturias: 8% to 10% (progressive rate)
- Balearic Islands: 8% to 13% (progressive rate)
- Canary Islands: 6.5%
- Cantabria: 9%
- Castile-La Mancha: 9%
- Castile and León: 8% to 10% (progressive rate)
- Catalonia: 10% to 11%
- Ceuta: 6%
- Community of Madrid: 6%
- Valencian Community: 10% to 11%
- Extremadura: 8% to 11% (progressive rate)
- Galicia: 8%
- La Rioja: 7%
- Melilla: 6%
- Murcia: 8%
- Navarre: 6%
- Basque Country: 7%
These rates may vary each year. Inquire before launching your real estate project.
How is ITP calculated?
The ITP is calculated on the reference value of the property, which in 99% of cases corresponds to the sale price. The tax authorities may, however, re-evaluate this value if they believe that the declared price is too low (suspicion of a sale containing a portion paid in cash, not declared in the sale price).
Calculation example:
- In Valencia: for a property of €300,000, the amount of ITP is 300,000 x 10% = €30,000.
How to pay the ITP?
- Obtain a Foreigner Identity Number (NIE).
- Open a bank account in Spain.
- Fill out form 600 (available online).
- Pay within 30 working days following the signing of the deed of sale.
In case of delay, penalties apply: up to 20% for more than 12 months of delay.
Cases of reductions or exemptions
- Buyers under 35 years of age (specific regions).
- Large families.
- People with disabilities.
- Purchase of social housing.
The criteria vary according to the autonomous communities. Check the specific conditions for your region of purchase.
What are the consequences of non-compliance with the rules?
- Fines up to 150% of the amount of the work.
- Demolition of unauthorized works.
- Complications when reselling the property.
Do not take unnecessary legal and administrative risks.
Advice from Terreta Spain experts
- Check the ITP rates in your region before finalizing your purchase.
- Keep a copy of all documents relating to your purchase.
- Strictly adhere to the deadlines and legal formalities.
FAQ: ITP in Spain
What is ITP and who does it apply to?
ITP is a regional tax in Spain, applicable when purchasing a resale property. Rates vary by region.
How is ITP calculated?
By applying the regional rate to the reference value of the property.
What are the deadlines for paying ITP?
Payment must be made within 30 working days following the signing of the deed of sale.
