The Property Transfer Tax (ITP) is the single biggest tax cost when buying a resale property in Spain — and unlike most taxes on this site, it’s set regionally, so the rate you pay depends entirely on where in Spain you’re buying.
When ITP Applies
ITP applies to resale (second-hand) properties. New-build properties purchased directly from a developer instead incur VAT (IVA, typically 10%) plus Stamp Duty (AJD), which is a different tax structure covered in its own context — most foreign buyers purchasing an existing home will pay ITP.
2026 Rates by Region
| Region | Standard ITP rate |
|---|---|
| Andalusia | 7% (flat, reduced from a previous tiered 8–10% system) |
| Valencia | 9% (11% above €1 million) |
| Catalonia | 10% up to €600,000, rising progressively to 13% above €1.5 million |
| Madrid | Among the lower rates nationally; check current regional decree, as Madrid periodically adjusts |
| Balearic Islands | Progressive scale, broadly in the 8–11%+ range depending on price |
Rates and brackets change periodically with regional budget decisions, so always confirm the current rate with your lawyer or notary before finalizing your budget — the figures above are a planning reference, not a guarantee for your specific transaction date.
What the Tax Is Actually Calculated On
ITP is calculated on whichever is higher: the declared purchase price, or the official Valor de Referencia (Reference Value) set by the Spanish Cadastre based on local market data. This matters because you can’t reduce your tax bill by under-declaring the purchase price — the tax authority will apply the Reference Value instead if it’s higher.
Reduced Rates for Young Buyers
Several regions offer significantly reduced ITP rates for buyers under a certain age (commonly 35) purchasing their first home below a set price threshold — for example, Andalusia reduces the rate to 3.5% for qualifying buyers under 35 on homes up to €150,000. These discounts are generally tied to the property being a primary residence, so they typically don’t apply to foreign buyers purchasing a second home or holiday property.
Frequently Asked Questions
Who pays ITP, the buyer or the seller?
The buyer pays ITP — it’s your responsibility as the purchaser, typically handled through your notary/lawyer as part of the completion process.
Can I negotiate the declared purchase price to lower ITP?
No — under-declaring is both illegal and ineffective given the Valor de Referencia rule, and can expose you to penalties if discovered.
Does ITP apply if I buy through a company rather than personally?
Yes, ITP generally still applies to the transfer regardless of whether the buyer is an individual or a company — company structures don’t exempt the transaction from this tax.