Buying a property in Spain can entail an additional tax cost of between 8% and 15% on top of the property price, depending on the autonomous community, the type of property (new build or resale) and your status as a Spanish tax resident or non-resident. This guide, updated to 2026, explains step by step all the taxes you will pay when signing the title deed, which rates apply in each autonomous community following the recent reforms (Catalonia’s Decree-Law 5/2025, the reduction of the Valencian ITP), how the cadastral reference value affects your tax bill and what annual tax obligations a non-resident owner takes on.
Tax overview: what taxes you pay when buying a property in Spain
When acquiring a property in Spanish territory, the buyer takes on a combination of state and regional taxes that are settled at different stages of the process. The exact tax burden depends on three variables that should be clear from day one: the type of property, its location and your tax residency status.The three main taxes in a purchase transaction
Every property purchase in Spain revolves around three taxes that are mutually exclusive depending on the type of transaction:Transfer Tax (ITP – Impuesto sobre Transmisiones Patrimoniales)
Applies to the purchase of resale property between private individuals. It is a tax ceded to the autonomous communities, so its rate varies between 6% and 13% depending on the region.Value Added Tax (VAT – IVA)
Applies only to the first transfer of a new-build property by the developer. The general rate is 10% (4% for officially protected housing under the special regime). In the Canary Islands it is replaced by the IGIC.Stamp Duty (AJD – Actos Jurídicos Documentados)
Taxes the notarisation of the deed. It only accrues on new-build property and on mortgages. The rate ranges between 0.5% and 2% depending on the autonomous community.Key difference: ITP or VAT, never both
A common mistake among foreign buyers is to assume that they will pay both taxes. This is not the case. If the property is a resale, you pay ITP. If it is a new build delivered directly by the developer, you pay VAT plus AJD. The exception is properties that the developer has rented out for more than two years before selling: for tax purposes they are considered a second transfer and are taxed under ITP.Associated costs that are not taxes but impact the final budget
In addition to the taxes when buying a property in Spain, you should also factor in:- Notary fees: between €600 and €1,000 (regulated tariff).
- Land Registry: approximately between €400 and €650.
- Administrative agency (gestoría): around €300-500 if you delegate the paperwork.
- Appraisal: €250-600 if you need a mortgage.
- Independent lawyer’s fees: between 1% and 1.5% of the purchase price (recommended for foreign buyers).
ITP: the key tax on the purchase of resale property in Spain
The Transfer Tax (ITP) is, in economic terms, the most relevant tax for the majority of foreign buyers, since the bulk of Spain’s property stock on the coast, in historic cities and in established areas is resale.Taxable event, taxpayer and accrual
The taxable event is the onerous transfer of a property between private individuals. The taxpayer is always the buyer, regardless of nationality or tax residency. Accrual occurs on the date the public deed is signed before a notary, the moment from which the 30-business-day deadline starts to file form 600 with the relevant regional tax authority.On what amount is ITP calculated?
Since Law 11/2021 on anti-fraud measures came into force, the ITP taxable base is the higher of these two values:- The price declared in the deed.
- The cadastral reference value set by the General Directorate of the Cadastre.
VAT and AJD: specific taxation on the purchase of new-build property
If you buy a newly built or off-plan property directly from the developer, the transaction is taxed under VAT and AJD, not ITP.10% VAT (or 4% for officially protected housing under the special regime)
The general rate applicable to the first delivery of a new-build home is 10% on the deeded price. For officially protected housing under the special regime or public housing schemes, the rate is reduced to 4%. For commercial premises, parking spaces unlinked from the home and developable land, the applicable VAT is 21%.AJD: the second tax on new-build property
Stamp Duty (AJD) taxes the formalisation of the public deed. On new-build property it accrues compulsorily, with rates that vary:- Madrid: 0.75%
- Andalusia: 1.2%
- Catalonia: 1.5% (general)
- Valencian Community: 1.5%
- Balearic Islands: 1.2%
The special case of the Canary Islands: IGIC instead of VAT
The Canary Islands have a specific tax regime. Instead of VAT, the Canary Islands General Indirect Tax (IGIC) applies, with a rate of 7% on new-build property instead of the 10% peninsular rate. This makes the archipelago one of the most tax-advantageous locations for new-build investment.Comparative table of ITP by autonomous community in 2026
ITP falls under regional jurisdiction and the differences are very significant: buying a property worth €400,000 in Madrid versus Catalonia can mean a tax difference of more than €16,000.| Autonomous community | General ITP rate | Notes |
|---|---|---|
| Madrid | 6% | One of the lowest; up to 100% rebate in municipalities at risk of depopulation |
| Navarre | 6% | Own regional regime (régimen foral) |
| Basque Country | 4% – 7% | Régimen foral; differentiated rates by historic territory |
| Canary Islands | 6.5% | 7% IGIC on new builds instead of VAT |
| Andalusia | 7% | Reduced to 6% on main residence up to €150,000 |
| La Rioja | 7% | Rebates for main residence |
| Castilla-La Mancha | 9% | — |
| Aragon | 8% – 10% | Progressive scale |
| Murcia | 8% | — |
| Asturias | 8% – 10% | Progressive scale |
| Galicia | 10% | Rebates for rural areas at risk of depopulation |
| Cantabria | 10% | — |
| Castile and León | 8% – 10% | Reductions for young buyers in rural areas |
| Valencian Community | 10% (until May 2026) / 9% from June 2026 | 11% for properties above €1M |
| Extremadura | 8% – 11% | Progressive scale |
| Balearic Islands | 8% – 13% | Progressive scale; top bracket for high-end properties |
| Catalonia | 10% – 13% | Progressive scale since 27/06/2025 (Decree-Law 5/2025); 20% rate for large property holders |
Catalonia: the Decree-Law 5/2025 reform that changes the game
The Generalitat approved in 2025 a far-reaching reform of the Catalan ITP that introduces, for the first time in Spain, a progressive scale similar to that of personal income tax. The new brackets in force since 27 June 2025 are:- Up to €600,000: 10%
- From €600,000 to €900,000: 11%
- From €900,000 to €1,500,000: 12%
- Over €1,500,000: 13%
Valencian Community: reduction of the general rate in 2026
The Valencian Community has approved a reduction of the general ITP rate from 10% to 9% from 30 June 2026, maintaining 11% for properties over one million euros. It is one of the few regions where the tax trend is downwards, which reinforces the appeal of the Costa Blanca to international investors.The cadastral reference value: how it affects your tax bill
Since 1 January 2022, the cadastral reference value has become the most decisive factor in calculating ITP, AJD and Inheritance and Gift Tax. For a foreign buyer, understanding it is essential before signing any offer.What the reference value is
It is an administrative value set annually by the General Directorate of the Cadastre, calculated from actual purchase prices recorded before notaries for comparable properties in each area. Its purpose is to provide an objective market reference to prevent tax declarations below real value.How it is applied to the purchase
If the deeded price is lower than the reference value, ITP is calculated on the reference value. If it is higher, on the deeded price. In practice, this means that even if you negotiate a good price with the seller, you could end up paying tax on a base higher than what you actually paid.How to check it before buying
The reference value can be consulted free of charge at the Cadastre’s Electronic Office by entering the property’s cadastral reference. Requesting it before signing the deposit agreement is standard practice in any serious due diligence.Properties without an assigned reference value
Not every property has a reference value. Properties that typically lack one include unique properties, rural estates, old houses without updated cadastral records or properties with urban planning peculiarities. In these cases the taxable base is the market value, and the Tax Authority can carry out a subsequent value verification, with a supplementary assessment if it considers that the declared value was below market.How to challenge the reference value
The reference value can be challenged, but only after the fact: first you pay the tax and then you request the rectification of the self-assessment or file an appeal. Recent case law (High Courts of Castile and León and Galicia) requires the submission of a technical expert report justifying why the cadastral value exceeds market value; a simple mortgage appraisal is usually insufficient. The Constitutional Court has admitted for consideration a question of unconstitutionality regarding the reference value. Until it is resolved, it is advisable to file the self-assessment with a statement of disagreement to preserve the right to claim a refund in the event of a favourable ruling.Tax differences between resident and non-resident buyers
A widespread belief among foreign buyers is that they will pay more tax simply because they are not residents. On the purchase itself, this is not the case: ITP, VAT and AJD apply in exactly the same way regardless of tax residency. The differences appear on three other fronts.Who is a tax resident in Spain
The Spanish Tax Authority considers a person to be a tax resident if any of these three criteria is met:- Spending more than 183 days in Spanish territory in the calendar year.
- Having the main centre of activities or economic interests in Spain.
- Having a non-legally separated spouse and underage children habitually residing in Spain (a presumption that admits proof to the contrary).
Three areas where residency does make a difference
- Access to mortgages: non-residents access financing with a lower LTV (60-70% vs the 80% available to residents).
- Recurrent taxation: non-residents pay IRNR (Non-Resident Income Tax) annually, even if they do not rent out the property.
- Regional ITP rebates: although since 2021 European equalisation has eliminated most discrimination, in practice some rebates (main residence, buyers under 35) are inaccessible to anyone who does not establish actual residence in Spain.
EU versus non-EU: relevant differences
The distinction between EU and non-EU buyers does have a direct tax impact on IRNR on rental income:- Residents in the EU, Iceland or Norway: rate of 19% with the right to deduct expenses.
- Residents outside the EU/EEA: rate of 24% with no possibility of deducting expenses.
Recurrent taxes after the purchase: what you will pay each year
The most costly mistake made by foreign investors is budgeting only the acquisition cost. Owning property in Spain entails annual tax obligations that you should be aware of from the outset.IBI (Property Tax)
This is the main municipal tax. It is collected by the town council and calculated by applying a rate (between 0.4% and 1.1% depending on the municipality) to the property’s cadastral value. For a €300,000 home in a coastal area, it usually ranges between €400 and €1,200 per year.IRNR for non-residents: the silent obligation
Every non-resident with property in Spain must file form 210 annually. There are two scenarios:- Property not rented out: tax is paid on imputed income of 1.1% or 2% of the cadastral value (depending on whether it has been revised in the last 10 years), then applying the 19% rate (EU/EEA) or 24% (rest).
- Rented property: quarterly declaration on the income actually received.
Wealth Tax and Temporary Solidarity Tax
Non-residents are only taxed on their wealth located in Spain. The general exempt minimum is €700,000 per person, plus an additional €300,000 exemption on the main residence (not applicable to non-residents). Communities such as Madrid grant a 100% rebate on this tax, but the Temporary Solidarity Tax on Large Fortunes, applied at state level, continues to tax wealth above three million euros regardless of the region.Waste collection fee and community fees
Although these are not taxes in the strict sense, they should be budgeted for: municipal waste collection fee (between €80 and €200 per year) and community of owners fees (from €600 to €3,600 per year in flats with shared services).Case study: a €350,000 property in Barcelona, Madrid and Málaga
To understand the real impact of regional differences, we compare the same transaction —the purchase of a €350,000 resale property by an EU non-resident— in three locations.| Item | Barcelona (Catalonia) | Madrid | Málaga (Andalusia) |
|---|---|---|---|
| Applicable ITP | 10% | 6% | 7% |
| ITP amount | €35,000 | €21,000 | €24,500 |
| Approximate notary fees | €800 | €800 | €800 |
| Approximate Land Registry | €500 | €500 | €500 |
| Gestoría | €400 | €400 | €400 |
| Independent lawyer (1%) | €3,500 | €3,500 | €3,500 |
| Total additional cost | €40,200 | €26,200 | €29,700 |
| % on price | 11.5% | 7.5% | 8.5% |
Deadlines, tax forms and consequences of non-payment
The taxes on a purchase transaction are not paid to the notary on the day of signing. The buyer (or their tax representative) must self-assess them in time before the relevant tax authority.Key forms and deadlines
- Form 600: ITP and AJD. Filed with the regional tax authority where the property is located. Deadline: 30 business days from the deed.
- Form 211: 3% withholding that the buyer must pay over when the seller is a non-resident. Deadline: 1 month from signing.
- Form 210: annual IRNR declaration for non-resident owners. Usual deadline: the calendar year following.
- Form 714: Wealth Tax. Deadline: June of the following year.
Consequences of filing late
Article 27 of the General Tax Law sets automatic surcharges for late filing:- Up to 12 months late: 1% surcharge plus an additional 1% for each month of delay.
- More than 12 months: a fixed 15% surcharge plus late-payment interest.
The registry block: why ITP is a priority
Article 255 of the Mortgage Act establishes a very effective enforcement mechanism: the Land Registry will not register the change of ownership until payment of ITP or VAT has been evidenced. Without registration, your property does not enjoy full protection against third parties, you will not be able to sell it normally and bank financing is blocked.Rebates and reductions available to foreign buyers
Although the most significant regional rebates are tied to tax residency status, there are several reductions applicable to international buyers that are worth reviewing on a case-by-case basis.General rebates (independent of residency)
- Officially protected housing: reduced VAT (4%) and ITP rates in all communities.
- Large families: reduced rates of 3.5%-5% depending on the region, provided the official certificate is produced.
- People with a disability of over 33%: significant reductions in most regions.
- Acquisition of property in depopulation areas: rebates that can reach 100% in small municipalities in Castile and León, Aragon, Galicia or northern Madrid.
The frequent mistake made by foreign buyers
Many rebates require the property to be used as a main residence, which in tax terms means residing for more than 183 days a year in Spain. Applying a main-residence rebate without meeting this condition can lead to a subsequent audit, regularisation with interest and, in serious cases, a penalty for tax infringement.Frequently asked questions about taxes when buying property in Spain
How much do you pay in taxes when buying a house in Spain?
Between 8% and 15% on the purchase price. The exact tax burden depends on the type of property (new build or resale), the autonomous community where the property is located and the applicable rebates. For a €300,000 resale property in Madrid, taxes and costs amount to approximately €22,500; in Catalonia, more than €36,000.What taxes does a foreigner pay when buying a home in Spain?
The same as a Spanish buyer: ITP (resale) or VAT plus AJD (new build). Nationality does not trigger additional taxes on the purchase. The differences for foreigners appear in recurrent taxation (annual IRNR) and in access to regional rebates, which usually require tax residency in Spain.
What is the difference between ITP, VAT and AJD?
ITP taxes the sale of resale property between private individuals. VAT taxes the first transfer of a new build by the developer. AJD taxes the notarisation and only applies to new builds and to mortgages. ITP and VAT are mutually exclusive: both are never paid on the same transaction.What happens if I buy the house below the cadastral reference value?
ITP will be calculated on the cadastral reference value, not on the price actually paid. Law 11/2021 established that the taxable base is the higher of the reference value and the deeded price. If this is not correctly applied, the Tax Authority will issue a supplementary assessment with late-payment interest.
