I.B.I . (Impuesto Bienes Inmuebles)
This is an annual real estate tax levied by the local town hall and is usually 0.85% of the catastral value (Valor Catastral). This value is the assessed value for tax purposes and is important because other taxes are based on it as well. When you buy, you want to see the seller’s last receipt for the IBI payment. This contains the value and the exact amount of the tax.
Rubbish collection & water rates (Basura) (Agua)
The rubbish collection rate is applied by the Town Hall according to the property and payable every 6 months. For an apartment in Marbella rubbish collection is approximately €162 and a villa approximately €242 per year. Water consumption is calculated by the water meter consumption in cubic meters and is payable every 3 months. Payment can be made directly at the Town Hall or by bank with direct debit instructions.
Property Income Tax
This is an annual tax due to be paid the year following the tax year in question.
Any potential earnings on the property you wish to buy, say from renting a frontline golf apartment, will not be taken into account by Spanish banks.
Non-Residents (IRNR)
Non-residents must pay Income Tax (IRNR) on income received through the ownership of property in Spain. There are two forms of taxation applicable depending on the source:
A. Actual income gained on property rentals: 24% on returns less deductibles
B. Deemed income. The Spanish tax agency attributes to you an imaginary income each year of 2% of the catastral value of your property. It then charges you the income tax rate of 24% on this imaginary income. You can also think of it as one half of one per cent of the catastral value.
If your catastral value was sharply increased after 1994, your imaginary income is only 1,1 per cent.
Community Fees
These are fees paid to the Community of Owners for services and maintenance of communal areas, when the property is located in a development or condominium apartment building.
These communities are subject to Spanish law of Horizontal Division. All property owners of the block form the Community of Property Owners. They are responsible for their individual parts and common areas of the block. They all participate in the expenses of the community on a pro-rata basis. Every apartment of the block has a share in the communal areas, usually proportionate to the size of the owner's property.
A budget for the annual community expenses is presented at the annual general meeting of the homeowners, and they or their authorized representatives must approve the budget by majority vote of those present at the meeting. Expenses can vary substantially according to the services provided, and normally include salary and social security of the hall porter, common garden maintenance, lift maintenance, repairs to common elements, rubbish collection, water for watering community gardens, electricity for lighting communal areas, insurance, security, and administration fees. The President of the community must, by law, own a property within the complex itself and is chosen by way of vote by the co-owners. The President should have no remuneration for this role.
