{"id":10541,"date":"2020-01-23T09:04:53","date_gmt":"2020-01-23T08:04:53","guid":{"rendered":"http:\/\/www.shmadrid.com\/blog\/en\/?p=10541"},"modified":"2020-01-15T11:11:41","modified_gmt":"2020-01-15T10:11:41","slug":"itp-tax","status":"publish","type":"post","link":"https:\/\/www.shmadrid.com\/blog\/en\/itp-tax\/","title":{"rendered":"ITP, the Unknown Tax"},"content":{"rendered":"<p style=\"text-align: justify;\">We all have to deal with taxes, in order to contribute to the social welfare of the health care system. And a country like Spain has many types of taxes, some are known to everyone, some are lesser-known.<\/p>\n<p style=\"text-align: justify;\">Today, this article by <a href=\"http:\/\/www.shmadrid.com\" target=\"_blank\" rel=\"noopener noreferrer\"><strong>ShMadrid<\/strong><\/a> will focus on the <em>Impuesto de Transmisiones Patrimoniales<\/em> or ITP (Property Transfer Tax). This is a tax we forget most of the time until we are confronted with it&#8230;<\/p>\n<p style=\"text-align: center;\"><em>Related article:\u00a0<a href=\"http:\/\/www.shmadrid.com\/blog\/en\/advantages-renovated-apartment-madrid\/\">Advantages of Buying a Renovated Apartment in Madrid<\/a><\/em><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_17 counter-hierarchy\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">Index<\/p>\n<span class=\"ez-toc-title-toggle\"><\/span><\/div>\n<nav><ul class=\"ez-toc-list ez-toc-list-level-1\"><li class=\"ez-toc-page-1 ez-toc-heading-level-2\"><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.shmadrid.com\/blog\/en\/itp-tax\/#itp-not-clear-for-everyone\" title=\"ITP, not clear for everyone\">ITP, not clear for everyone<\/a><ul class=\"ez-toc-list-level-3\"><li class=\"ez-toc-heading-level-3\"><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.shmadrid.com\/blog\/en\/itp-tax\/#what-is-itp\" title=\"What is ITP?\">What is ITP?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-3\"><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.shmadrid.com\/blog\/en\/itp-tax\/#who-pays-for-this-tax\" title=\"Who pays for this tax?\">Who pays for this tax?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-3\"><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.shmadrid.com\/blog\/en\/itp-tax\/#how-is-this-tax-calculated\" title=\"How is this tax calculated?\">How is this tax calculated?<\/a><\/li><li class=\"ez-toc-page-1 ez-toc-heading-level-3\"><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.shmadrid.com\/blog\/en\/itp-tax\/#when-and-how-is-the-tax-settled\" title=\"When and how is the tax settled?\">When and how is the tax settled?<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"itp-not-clear-for-everyone\"><\/span>ITP, not clear for everyone<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"what-is-itp\"><\/span>What is ITP?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div id=\"attachment_10542\" style=\"width: 310px\" class=\"wp-caption alignright\"><a href=\"http:\/\/www.shmadrid.com\/blog\/en\/wp-content\/uploads\/2020\/01\/impuestos-300x177.jpg\"><img aria-describedby=\"caption-attachment-10542\" loading=\"lazy\" class=\"size-medium wp-image-10542\" src=\"http:\/\/www.shmadrid.com\/blog\/en\/wp-content\/uploads\/2020\/01\/impuestos-300x177-300x177.jpg\" alt=\"calculator, pen and papers\" width=\"300\" height=\"177\" \/><\/a><p id=\"caption-attachment-10542\" class=\"wp-caption-text\"><em>Photo via Pixabay<\/em><\/p><\/div>\n<p style=\"text-align: justify;\">ITP is a tax that is imposed on second-hand purchases, for example, a car, house or rental home. It also refers to an increase or decrease of a company\u2019s capital, as well as a tax on legal transactions, like the public deeds of the <strong>sale of a house<\/strong>, or the formalization of a <a href=\"http:\/\/www.shmadrid.com\/blog\/en\/requirements-mortgages-2020\/\"><strong>mortgage<\/strong><\/a> deed.<\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"who-pays-for-this-tax\"><\/span>Who pays for this tax?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">ITP is a state tax that is handled by each of the Autonomous Communities, so it is paid at the <a href=\"https:\/\/atc.gencat.cat\/es\/tributs\/itpajd\/index.html\" target=\"_blank\" rel=\"nofollow\"><strong>Tax Office<\/strong><\/a> of your corresponding community. There is a <strong>deadline<\/strong> for paying ITP, and this is <strong>30 days<\/strong> from the day you purchased a property or signed the deed.<\/p>\n<p style=\"text-align: justify;\">In case of a <a href=\"https:\/\/www.shmadrid.com\/madrid-rent\"><strong>rental<\/strong> <strong>home<\/strong><\/a>, the tenant (Article 8.f) is responsible for paying this tax, although the landlord remains liable if he has received the first monthly rent without requiring the tenant to pay for this tax, according to Article 9 of <strong><em>La Ley del Impuesto sobre Transmisiones Patrimoniales y Actos Jur<\/em><\/strong><strong><em>\u00eddicos Documentados<\/em> <\/strong>(the revised text of the Law on Transfer Tax and Stamp Duty).<\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"how-is-this-tax-calculated\"><\/span>How is this tax calculated?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">The calculation of the Property Transfer Tax varies according to the specific operation that needs to be taxed. Basically, the tax rate is different for each operation, although the taxable base can also change. The other aspect that influences the way the tax is calculated, is the jurisdiction of the Autonomous Communities where the property is located.<\/p>\n<p style=\"text-align: justify;\">This tax is based on income, and only transactions between individuals are subject to it. Therefore, there is no need for a settlement when it concerns leases that are subject to VAT.<\/p>\n<p style=\"text-align: center;\"><em>Related article:\u00a0<a href=\"http:\/\/www.shmadrid.com\/blog\/en\/energy-performance-certificate\/\" target=\"_blank\" rel=\"noopener noreferrer\">What Does a Property\u2019s Energy Performance Certificate Mean?<\/a><\/em><\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"when-and-how-is-the-tax-settled\"><\/span>When and how is the tax settled?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div id=\"attachment_10543\" style=\"width: 310px\" class=\"wp-caption alignleft\"><a href=\"http:\/\/www.shmadrid.com\/blog\/en\/wp-content\/uploads\/2020\/01\/impuestos-I-300x199.jpg\"><img aria-describedby=\"caption-attachment-10543\" loading=\"lazy\" class=\"size-medium wp-image-10543\" src=\"http:\/\/www.shmadrid.com\/blog\/en\/wp-content\/uploads\/2020\/01\/impuestos-I-300x199-300x199.jpg\" alt=\"laptop and calculator\" width=\"300\" height=\"199\" \/><\/a><p id=\"caption-attachment-10543\" class=\"wp-caption-text\"><em>Photo via Pixabay<\/em><\/p><\/div>\n<p style=\"text-align: justify;\">The tax must be paid within a maximum period of one month from the date the <a href=\"http:\/\/www.shmadrid.com\/blog\/en\/mistakes-signing-contract\/\"><strong>contract<\/strong><\/a> is signed and by means of self-assessment (Model 600).<\/p>\n<p style=\"text-align: justify;\">The general ITP rate is set at 6%, but it all depends on the region you are in, so it can change substantially depending on your specific area:<\/p>\n<ul style=\"text-align: justify;\">\n<li><strong>Andalusia<\/strong>: It depends on whether you buy a house, garage or premises. If the property is worth less than 400,000 euros, you would pay 8%, but it could be up to 10%. There is a reduced rate of 3.5% if the person who buys a house (to live in) is younger than 35 years old or disabled, and he should also meet certain requirements.<\/li>\n<li><strong>Aragon<\/strong>: The general rate is 7%, and there is a reduced rate for large families if certain requirements are met.<\/li>\n<li><strong>Asturias<\/strong>: The rate is very similar to Andalusia. It depends on the value of the property. It could be 8%, 9% or 10%. Discounts are possible for social housing or the transfer of a business.<\/li>\n<li><strong>Canary Islands<\/strong>: The general rate is 7%, and there is a discount for large families, for people under the age of 35 and for social housing.<\/li>\n<li><strong>Castilla La Mancha<\/strong>: A general rate of 8%, with discounted rates of 7% and 4%.<\/li>\n<li><strong>Catalonia<\/strong>: The general rate is 10%, and there is also a discount.<\/li>\n<li><strong>Extremadura<\/strong>: 8%, 9% or 10%, depending on the value of the property.<\/li>\n<li><strong>Galicia<\/strong>: The tax rate was raised to 10%.<\/li>\n<li><strong>Madrid<\/strong>: The general rate is 6%, but discounts are possible.<\/li>\n<li><strong>La Rioja<\/strong>: The general rate is 7%.<\/li>\n<li><strong>Valencia<\/strong>: The general rate is 8%.<\/li>\n<\/ul>\n<p style=\"text-align: center;\"><strong>What other interesting facts can you tell us about ITP?<\/strong><\/p>\n<div style=\"display: none;\"\n    class=\"kk-star-ratings kksr-valign-bottom kksr-align-center kksr-disabled\"\n    data-id=\"10541\"\n    data-slug=\"\">\n    <div class=\"kksr-stars\">\n    <div class=\"kksr-stars-inactive\">\n            <div class=\"kksr-star\" data-star=\"1\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\" data-star=\"2\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\" data-star=\"3\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\" data-star=\"4\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\" data-star=\"5\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n    <\/div>\n    <div class=\"kksr-stars-active\" style=\"width: 0px;\">\n            <div class=\"kksr-star\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n            <div class=\"kksr-star\">\n            <div class=\"kksr-icon\" style=\"width: 20px; height: 20px;\"><\/div>\n        <\/div>\n    <\/div>\n<\/div>\n    <div class=\"kksr-legend\">\n            <span class=\"kksr-muted\"><\/span>\n    <\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>We all have to deal with taxes, in order to contribute to the social welfare of the health care system. And a country like Spain has many types of taxes, some are known to everyone, some are lesser-known. Today, this article by ShMadrid will focus on the Impuesto de Transmisiones Patrimoniales or ITP (Property Transfer [&hellip;]<\/p>\n","protected":false},"author":318,"featured_media":10544,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1333],"tags":[2294,2295],"_links":{"self":[{"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/posts\/10541"}],"collection":[{"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/users\/318"}],"replies":[{"embeddable":true,"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/comments?post=10541"}],"version-history":[{"count":8,"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/posts\/10541\/revisions"}],"predecessor-version":[{"id":10568,"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/posts\/10541\/revisions\/10568"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/media\/10544"}],"wp:attachment":[{"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/media?parent=10541"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/categories?post=10541"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.shmadrid.com\/blog\/en\/wp-json\/wp\/v2\/tags?post=10541"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}