Property Transfer Tax (ITP) is the main tax liability payable when purchasing a second-hand home in Spain.
The percentage is calculated based on the cadastral reference value and between 6% and 10% of the purchase price of the asset. The ITP on housing is determined by the Autonomous Community in which the property is located and is paid by the purchaser.
What is the Property Transfer Tax on a home?
The ITP (property transfer tax) on a property is part of the taxes payable when purchasing a second-hand home.
This tax is levied on real estate transactions. when these are carried out between individuals. The amount varies depending on the autonomous community in which the transaction takes place.
ITP on the purchase of a home
When purchasing a second-hand property, ITP is one of the taxes that buyers must consider in the costs of each transaction. This tax is applied to the purchase price of the property, which is not subject to VAT as it is a second-hand home.
How is Property Transfer Tax paid when purchasing a home?
When buying or selling a second-hand home, The ITP settlement must be submitted using form 600 by the purchaser.
This form must be submitted to the tax office of the autonomous community where the property is located. It is also possible to pay this tax online if you have a digital certificate.
When is ITP paid when purchasing a property?
The deadline for submitting the ITP when purchasing a property is 30 working days after signing the sale agreement. Any delay beyond this date will result in surcharges and interest for late payment.
Where is the ITP (Transfer Tax) on a property paid?
The purchase of a second-hand home requires the buyer to pay the ITP (Transfer Tax), which they must pay to the regional tax office corresponding to the location of the property. It is advisable to check with the autonomous community to see if there are any special features of the payment procedure.
Differences in ITP depending on the type of property
There are exceptions and reduced rates for ITP payments in each region and by type of property.
Depending on the case and community, there are different conditions when the property value transferred exceeds a set amount; there are also reduced rates for the purchase of subsidised housing or housing with some form of official protection; for young people purchasing their first main residence; for large or single-parent families; for disabled people or victims of gender-based violence; and in cases where the price of the property does not exceed a certain amount. There are also reductions in the rate for sparsely populated or rural areas.
ITP for the first home
As it is not a uniform tax, each region determines the rates.
In many communities, purchasing a first home may involve special conditions with reduced rates for first-time buyers, generally for those under 35 years of age. Also, depending on the community, there may be benefits with a cap on the purchase price.
ITP rebate for primary residence
There are ITP tax reliefs for primary residences that meet certain conditions determined by each autonomous community. Primary residences will benefit from reduced rates in cases of physical, mental or sensory disability, single-parent families, and individuals under 35 purchasing their first home. These subsidies aim to facilitate access to housing and stimulate the local property market.
How Gesvalt helps
At Gesvalt, We assist our clients in important decisions such as purchasing or refinancing their home, inheritance, donation or divorce proceedings, and legal proceedings.
ECO valuations These are official documents that allow you to find out the value of any type of property (residential, commercial premises, warehouse, office, garage, hotel, land) for the purpose of correcting the value determined in the tax base of a tax, such as ITP.
The valuation determines the value of the property and requires a visit from a technician who carries out the necessary checks on the condition and characteristics of the property and specific documentation (registry and cadastral).