If you own property in Spain, you’ll pay IBI every year. Here’s what it is, how much it costs, and how to make sure you don’t miss it.
IBI — Impuesto sobre Bienes Inmuebles — is Spain’s annual property tax. Think of it as the Spanish equivalent of UK council tax. Every property owner in Spain pays it, whether they’re resident or not, whether the property is occupied or empty, and whether they own in a personal name or through a company.
It’s one of the unavoidable ongoing costs of Spanish property ownership and one of the first bills you’ll encounter after completion.
How is IBI Calculated?
IBI is calculated as a percentage of the valor catastral — the cadastral value of the property. This is not the market value or the purchase price. It’s an administrative value assigned by the local authority, typically significantly lower than what you paid.
The percentage applied varies by municipality — typically between 0.4% and 1.1% of the cadastral value. In practice, for a modest apartment in a town like Elche, the annual IBI bill is likely to be in the low hundreds of euros.
Who Pays It?
The owner of the property on 1 January of each year pays IBI for that full year. This matters if you’re buying or selling mid-year — it’s standard practice in Spain for the buyer and seller to apportion the IBI at completion, with the seller paying their share up to the completion date.
Your gestor or notary should handle this apportionment at completion. If it isn’t mentioned, ask.
When is it Due?
IBI is billed annually by the local authority (ayuntamiento). The payment window varies by municipality but is typically between September and November. Missing the payment window results in surcharges, so it’s worth setting a reminder or setting up a direct debit from your Spanish bank account or Revolut Business account.
How to Pay
The simplest approach is to set up a direct debit (domiciliación bancaria) with your local ayuntamiento. Your gestor can arrange this. Once set up, IBI is collected automatically each year with no action required from you.
If you don’t have a direct debit in place, you can pay in person at the ayuntamiento, at certain banks, or online through the local authority’s payment portal.
IBI and the Cadastral Reference
Your property’s cadastral reference (referencia catastral) is the unique identifier used by the tax authority to calculate and bill IBI. It appears on your nota simple and your escritura. Make sure your gestor has this on file — it’s needed for IBI registration and any future tax filings.
What Happens if You Don’t Pay
Unpaid IBI accumulates as a charge against the property — not against you personally. This means if you sell the property, any outstanding IBI will need to be settled before or at completion. It also shows up on a nota simple as a registered charge, which will flag immediately to any buyer doing due diligence.
In practice, if IBI is set up correctly with a direct debit from the start, it runs itself. It’s only a problem if it falls through the cracks.
The Bottom Line
IBI is a small, predictable annual cost that every Spanish property owner pays. Set up a direct debit through your gestor as soon as you complete, file the cadastral reference, and it will take care of itself year after year.
Want a full picture of the ongoing costs of owning property in Spain? The Real Costs of Buying Property in Alicante covers purchase costs in detail, and What is a Gestor in Spain? explains who manages ongoing tax obligations on your behalf.