News in the property tax in Spain in the Valencian Community and the ITP of the Region of Murcia in 2024
Introduction: What is property tax in Spain (ITP)?
The property tax in Spain, also known as ITP, is a tax levied in the Valencian Community and other autonomous communities in Spain. This tax is levied on transactions involving real estate and other assets.
Transfer tax is levied when there is a transfer of ownership of real estate, whether by purchase, gift, inheritance or other form of transfer. It may also apply in cases of leases with an option to purchase or transfers of rights in rem.
The taxable base of the tax is determined by the higher value of :
- The real value of the property declared in the deed.
- The reference value established by the land registry.
The applicable rate varies according to the autonomous community and can be progressive depending on the value of the property.
It is important to bear in mind that this tax is managed by the autonomous communities, which means that each one has its own regulations and tax rates. Therefore, it is necessary to consult the specific legislation of the Valencian Community or another community where the transfer takes place in order to find out the applicable rates and the procedures to be followed.
Who must pay property tax in Spain (ITP) and when?
The declaration of the property transfer tax (ITP) is made through the form 600 and must be presented and paid by the purchaser of the property or his representative.
The self-assessment must be submitted within a period of one month from the day the deed is signed at the notary’s office.
It is important to remember that this deadline is general and may vary depending on the specific regulations applicable to each case. Remember to always consult the corresponding legislation to ensure that you comply with the established deadlines.
Fees and tax rates in the Valencian Region
In the Valencian Community, there are different rates and tax rates that must be taken into account when carrying out operations or transactions.
The general rate is applied to most transactions and is set at 10%. However, it is important to mention that there are reduced rates for those homes that are considered to be regular, young or disabled. These special tax rates are intended to encourage the acquisition and maintenance of housing for residential use and for the most needy.
In addition, it is important to note that special tax rates are also applied for certain specific transactions. These may vary depending on the type of transaction or activity carried out, and their aim may be to encourage or regulate certain economic sectors.
There are a number of special ITP rebates in the Valencian Community. You can see the ITP rebates in the Valencian Community in this link.
It is essential to be informed about the tax rates in force in the Valencian Community when carrying out any type of transaction or economic activity, as this will allow you to comply with the corresponding tax obligations and avoid possible penalties or legal inconveniences.
What's new in the ITP in the Valencian Community in 2024?
With effect from 1-1-2024, reduced rates are introduced for the acquisition of properties that will constitute the habitual residence in the Valencian Community, when their value does not exceed 180,000 euros.
With the aforementioned effects, lower rates are introduced for onerous capital transfers TPO in the acquisition of certain properties, when their value does not exceed 180,000 euros. Thus:
What's new in the ITP in the Murcia region in 2024?
The general tax to pay buying a second hand property in Murcia region is 8%. However there somo reduction for certain persons.
With effect from 30-12-2023, the main novelty in the region of Murcia with respect to ITP is the increase in the age for the application of the reduced rates for the acquisition of property by young people.
With the aforementioned effects, the following new features are introduced:
a) In relation to TPO:
1. The age for applying the reduced rate of 3% in the purchase of a primary residence by young people is increased from 35 to 40 years. It is also established that the maximum amount of the general taxable base minus the personal and family minimum must be less than 40,000 euros (previously 26,620 euros).
2. The age for applying the reduced rate of 5% for the acquisition of property by young entrepreneurs or professionals or by trading companies directly owned in full by them and intended to be their tax domicile or place of work is increased from 35 to 40 years old.
3. In relation to the rebate for the transfer or temporary assignment of rural properties, it is established that it must be formalised in a public document (previously a public deed). In the case of a public deed, mention must be made of the rebate applied.
Likewise, the requirements for this rebate have been renumbered to correct an error in its enumeration (letter b was repeated).
b) In relation to AJD:
1. The age for applying the reduced rate of 0.1% in the case of first copies of public deeds granted to formalise the first transfer of dwellings covered by the Youth Housing Plan of the Region of Murcia is increased, so that it is applicable to purchasers aged 40 or under (previously 35 years old).
2. The age for applying the reduced rate of 0.1% to the purchase of a primary residence by young people between the ages of 35 and 40 is increased. It is also established that the maximum amount of the general taxable base minus the personal and family minimum must be less than 40,000 euros (previously 26,620 euros).
