IBI — Spanish Property Tax
IBI (Impuesto sobre Bienes Inmuebles) is Spain's local property tax — an annual municipal tax on the cadastral value, charged regardless of the owner's tax residency.
How IBI is calculated
The tax base is the cadastral value (valor catastral) — an official value set by the Spanish land registry office, usually well below market price. The local council (Ayuntamiento) applies its own rate, typically between roughly 0.4% and 1.3%. A flat with a cadastral value of €120,000 taxed at a 0.9% municipal rate would owe around €1,080 per year — the exact rate varies by municipality and should be confirmed locally.
Who pays, and when
Whoever is registered as owner on 1 January of the tax year is liable — even if the property is sold later that year. The purchase contract should clearly state who covers the IBI for the year of purchase. Payment is usually collected by direct debit from a Spanish bank account; many municipalities also offer instalment plans.
IBI is not the only tax obligation
IBI is a pure ownership tax and is often confused with IRNR (non-resident income tax, Modelo 210) — these are two separate taxes charged in parallel: IBI applies to every owner regardless of residency, while IRNR specifically targets non-residents and applies even for a property that is only used privately or left vacant.
Is this the same as UK council tax?
Not exactly, but it's the closest equivalent. IBI is Spain's annual local property tax, similar in function to UK council tax — a municipal charge based on the property's assessed value, paid by whoever owns it, independent of tax residency. Unlike council tax, it isn't linked to local services usage banding; it's a flat percentage of the cadastral value set by each municipality.
Related glossary terms
Non-Resident Tax Spain (Modelo 210 / IRNR)
The Modelo 210 is the Spanish tax return for non-residents (IRNR – Impuesto sobre la Renta de no Residentes). It is used to declare income from Spanish property – rental income where let, or a notional usage value for a non-let second home.
Property Transfer Tax Spain (ITP)
The ITP (Impuesto sobre Transmisiones Patrimoniales) is the Spanish transfer tax on the purchase of a resale property. The rate is set by the respective autonomous region and therefore varies regionally.
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