Buying a resale property in Spain is an exciting milestone, but navigating the associated tax system can quickly feel overwhelming. Unlike buying a brand-new home, which is subject to Value Added Tax (VAT, or IVA in Spanish), purchasing a pre-owned property triggers a specific property transfer tax known as Impuesto de Transmisiones Patrimoniales, or ITP in short.
Because Spain's taxation system is heavily decentralized, ITP rules, deadlines, and tax rates vary dramatically depending on where the property is located. Failing to budget for this tax properly can derail your purchase, while missing the filing deadline results in costly penalties.
This guide breaks down exactly how the ITP tax works, current regional rates, how to avoid common valuation traps, and the step-by-step process for paying it.
What is the ITP tax in Spain?
The Impuesto de Transmisiones Patrimoniales, or ITP, is a transfer tax levied on secondary transmissions of assets. In the context of real estate, it applies exclusively to second-hand or resale properties.
The golden rule of Spanish property tax
- New build (first sale): subject to IVA (VAT) plus AJD (stamp duty).
- Resale (second sale or later): subject to ITP only. You never pay both IVA and ITP on the same transaction.
The buyer is entirely responsible for paying the ITP. The tax is calculated as a percentage of the purchase price, or more accurately, the official taxable value set by the government (more on this below).
How much is ITP? Regional tax rates explained
Spain is divided into 17 autonomous communities, and each region sets its own ITP tax rate. This means buying an identical €300'000 apartment will cost you significantly more in property tax in Valencia or Catalonia than it would in Madrid or Andalusia.
Most regions use either a flat rate or a progressive scale where the tax rate increases alongside the value of the property.
Standard ITP rates by region
The table below outlines standard ITP rates applied across Spain's most popular regions for property buyers. Rates change, so confirm the figure that applies to your purchase before you sign.
| Region / autonomous community | Standard ITP rate |
|---|---|
| Andalucía | 7% |
| Aragón | 8 - 10% |
| Asturias | 8 - 10% |
| Baleares | 8 - 13% |
| Canarias | 6.5% |
| Cantabria | 9% |
| Castilla la Mancha | 9% |
| Castilla León | 8 - 10% |
| Cataluña | 10 - 13% |
| Ceuta | 6% |
| Extremadura | 8 - 11% |
| Galicia | 8% |
| Madrid | 6% |
| Melilla | 6% |
| Murcia | 8% |
| Navarra | 6% |
| La Rioja | 7% |
| Comunidad Valenciana | 9 - 11% |
| País Vasco | 7% |
Reduced ITP rates
Most regions offer substantial ITP reductions (often cutting the rate down to 3% to 5%) if the buyer meets specific criteria. These reductions are typically reserved for:
- Buyers under the age of 35 using the property as their main residence (vivienda habitual).
- Large families (familias numerosas).
- Buyers with officially recognized disabilities.
- Purchases of designated social housing.
Note: If you are purchasing a holiday home or a rental property as a non-resident, you will almost always be subject to the standard regional rate.
The reference value trap: how ITP is actually calculated
Historically, buyers calculated ITP strictly using the purchase price stated in the deeds (escritura). However, Spain uses a system known as the reference value (valor de referencia de catastro).
The cadastral reference value is an official minimum value calculated by the government based on recent sales data in your specific neighborhood. By law, ITP must be calculated on whichever value is higher: the actual purchase price or the official reference value.
Taxable base = max(actual purchase price, cadastral reference value)
An example of the calculation trap
Imagine you negotiate a great deal on a resale apartment in Alicante (Valencian Community, 10% ITP) and buy it for €200'000.
- If the cadastral reference value for that property is €180'000, you pay 10% of your purchase price: €20'000.
- If the cadastral reference value is €230'000 (perhaps because the property needs major internal renovations that the government database cannot see), you are legally required to pay 10% of the government's value: €23'000. This case is nevertheless quite unusual.
If you pay tax based on your lower purchase price when a higher reference value exists, the Spanish tax authority (Hacienda) will automatically flag the discrepancy. Months later, you will receive a complementary tax assessment (liquidación complementaria) demanding the difference plus interest.
Before signing a purchase contract, the notary will normally pull the official valor de referencia using the property's cadastral reference number (referencia catastral) and let you know about it.
Model ITP and total purchase costs for Spain in the property calculator. Choose Spain as the country and adjust the ITP rate for your region.