How much is annual property tax in Spain?
IBI, the annual local property tax, is charged by the town hall on the cadastral value at a rate the municipality sets — typically 0.4% to 1.1% for urban property. Because cadastral values usually sit at roughly 40%–60% of market value, a €500,000 home commonly carries an IBI bill of €600 to €1,500 a year. A rubbish and services charge of €100–€300 and, in apartments and gated developments, community fees are payable on top.
- The rate is municipal, so neighbouring towns can differ materially.
- Unpaid IBI follows the property, not the former owner.
- The cadastral value on your IBI bill also drives non-resident income tax.
Key takeaways
- IBI is set by each town hall, typically 0.4%–1.1% of cadastral value per year.
- Unpaid IBI attaches to the property, so arrears pass to the next buyer.
- The basura (rubbish) charge adds roughly €100–€300 a year in most municipalities.
- Resale purchases carry ITP of 6%–10% depending on the region.
- New builds carry 10% IVA (7% IGIC in the Canaries) plus AJD of 0.5%–1.5%.
- Direct debit from a Spanish bank account is the only reliable way to pay from abroad.
IBI rates by region and city (2026)
| Region / city | Typical urban IBI rate | Indicative annual bill, €500k home | Billing |
|---|---|---|---|
| Madrid city | 0.428% | €900 – €1,200 | Annual, October–November |
| Barcelona | 0.75% | €1,200 – €1,900 | Annual, with instalment options |
| Malaga / Marbella | 0.44% – 0.71% | €700 – €1,500 | Annual, summer |
| Balearics (Palma, Ibiza) | 0.50% – 0.80% | €800 – €1,600 | Annual, autumn |
| Valencia / Alicante | 0.55% – 0.90% | €700 – €1,400 | Annual, often two instalments |
| Canary Islands | 0.40% – 0.75% | €500 – €1,100 | Annual |
| Murcia | 0.50% – 0.85% | €600 – €1,300 | Annual |
Rates are municipal, not regional, so a coastal town and the city 20km inland can differ by half again. The bill is issued to whoever owns the property on 1 January, and it is usually apportioned between buyer and seller by agreement at the notary rather than by law.
Other recurring charges
| Charge | Who levies it | Typical annual cost |
|---|---|---|
| Basura (rubbish and services) | Town hall | €100 – €300 |
| Community fees | Community of owners | €600 – €4,000+ depending on facilities |
| Home insurance | Insurer (required by lenders) | €250 – €900 |
| Vado (vehicle access licence) | Town hall, where applicable | €50 – €150 |
One-off purchase taxes by region
| Region | ITP (resale) | New build | AJD |
|---|---|---|---|
| Andalusia | 7% | 10% IVA | 1.2% |
| Madrid | 6% | 10% IVA | 0.75% |
| Catalonia | 10% (11% above €1m) | 10% IVA | 1.5% |
| Balearics | 8% – 13% sliding scale | 10% IVA | 1.2% – 2% |
| Valencia | 10% | 10% IVA | 1.5% |
| Canary Islands | 6.5% | 7% IGIC | 0.75% |
| Murcia | 8% | 10% IVA | 1.5% |
AJD (stamp duty) applies to new builds and to mortgage deeds; on resale purchases ITP replaces it. Full detail, including the Balearic sliding scale and the reference-value rules that set the minimum taxable base, is in the transfer tax by region guide, and total cash requirements are in the cost of buying guide.
Related guides
Frequently asked
Questions from readers
How much is IBI in Spain?
IBI is charged by the town hall on the cadastral value at a municipal rate, typically 0.4%–1.1% for urban property. Since cadastral values usually sit at 40%–60% of market value, a €500,000 home commonly pays €600–€1,500 a year.
Who pays IBI, the buyer or the seller?
The bill legally falls on whoever owned the property on 1 January. In practice buyer and seller apportion it at the notary for the part of the year each will own, but that is a matter of agreement rather than law.
What happens if IBI is not paid?
Unpaid IBI attaches to the property itself, so arrears transfer to a future buyer on sale. This is why a lawyer always checks the IBI position before completion, and why sellers are asked for the latest receipt at the notary.
What is the basura charge?
A municipal rubbish and services levy of roughly €100–€300 a year, billed separately from IBI in most towns. Some municipalities also charge for sewerage or vehicle access to a garage (vado).
How much transfer tax do I pay when buying in Spain?
On a resale, ITP of 6%–10% depending on the region — 6% in Madrid, 7% in Andalusia, 10% in Catalonia and Valencia, and a sliding 8%–13% in the Balearics. On a new build, 10% IVA (7% IGIC in the Canaries) plus AJD stamp duty of 0.5%–1.5%.
Is IBI deductible against rental income?
For EU and EEA residents, yes — IBI is a deductible expense against rental income on Modelo 210, apportioned to the days the property was let. UK and other non-EU owners are taxed on gross rent and cannot deduct it.
Can I pay Spanish property tax from a foreign bank account?
Not reliably. Town halls and collection agencies work through direct debit from a Spanish account, and any tax refund from the Agencia Tributaria can only be paid to a Spanish account. Opening one locally is part of the standard purchase process.