Taxation in Madrid
2026-10-16
Transfer Tax (ITP) in Madrid: the 6% Rate, Rebates and How It Is Calculated
ITP in Madrid is the transfer tax the buyer pays when acquiring a resale home: in the Community of Madrid the general rate is 6% of the property’s value. Rebates and reduced rates exist, but they apply to specific cases and rarely matter in high-value purchases.
This guide summarises the tax according to the information published by the Community of Madrid. If you are considering a purchase, you can browse our properties for sale in Madrid and complete the picture of costs with our guide to taxes when buying property in Madrid.
What ITP is and when it is paid
The Transfer Tax (Impuesto sobre Transmisiones Patrimoniales Onerosas, or ITP) applies to transfers of assets and rights between private parties, such as the purchase of a resale apartment or house. The person who must file and pay it is the acquirer, that is, the buyer.
ITP is not paid when the seller is a business or developer acting in the course of its activity: in that case the transaction is subject to VAT and Stamp Duty (AJD), as with new-build homes. We explain it in our guide to taxes when buying property in Madrid.
The rate in Madrid
For transfers of real estate, the Community of Madrid applies a general rate of 6%. For example, on a resale home priced at €1,000,000 the tax would be €60,000; on one priced at €2,000,000, €120,000.
The rate is applied to the higher of the declared price and the reference value set by the Land Registry (Catastro), used for taxable events since 1 January 2022. It is therefore advisable to know the reference value before signing.
To compare prices by area, browse properties in Goya, Recoletos or Justicia, and the rest of the BARNES Madrid services.
Rebates and reduced rates
The Community of Madrid provides, among others, the following cases:
- 10% rebate on the tax for individuals buying their main home, provided the property value is €250,000 or less (the home, up to two parking spaces and the storage room are counted).
- Reduced 4% rate for the main home of a large family, subject to further conditions, including selling the previous main home within two years before or after. It cannot be combined with the 10% rebate.
- 100% rebate for buyers under 35 purchasing their main home in a municipality of fewer than 2,500 inhabitants, up to €250,000.
In the prime segment, where prices comfortably exceed these limits, the general rate is usually what applies. We recommend reviewing each case with your tax adviser.
How the tax is calculated
The calculation is simple: the taxable base (the price or the reference value, whichever is higher) multiplied by the applicable rate. On a purchase of €1,500,000, ITP at 6% comes to €90,000.
Other purchase costs must be added to that amount: notary, Land Registry, administrative agent and, where relevant, mortgage costs. If you are the seller, bear in mind that there are also taxes for sellers; we summarise them in what municipal capital gains tax is in Madrid.
Deadlines and filing form 600
The deadline to file the self-assessment is 30 working days from the date of the deed; Saturdays, Sundays and public holidays are not counted. It is filed using form 600, either electronically through the Community of Madrid’s Virtual Tax Office or in person by appointment at a settlement office.
Usually the administrative agent or the notary handles this step, but the person legally responsible towards the tax authority is the buyer. For the full timeline of a purchase, see our page on the property buying process.
High-value and non-resident buyers
ITP follows the regional rate for the property, not the buyer’s nationality: a foreign buyer pays the same as a resident when the property is in Madrid. What does change for non-residents are other obligations, such as the NIE, a bank account or subsequent taxation; we cover them in buying property in Madrid as a non-resident.
At BARNES Madrid we support buyers before the offer, with a realistic estimate of costs and a selection of the best areas for your profile. To receive a personalised proposal, contact BARNES Madrid.
Frequently asked questions
How much is ITP in Madrid?
The general rate is 6% of the property’s value. There is a reduced 4% rate for large families and a 10% rebate for a main home of up to €250,000, in both cases subject to conditions.
Who pays ITP, the buyer or the seller?
The buyer pays it and is the person who must file the self-assessment.
Is ITP paid on a new-build home?
No. When a developer sells, the transaction is subject to VAT and Stamp Duty (AJD), not ITP.
Is ITP payable on renting a home?
Lettings of a home for stable, permanent use are exempt and, for contracts signed from 29 November 2024, the obligation to file the tax was removed.
What is the deadline to pay?
30 working days from the date of the deed, using form 600.
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How BARNES Madrid can help
At BARNES Madrid we support Spanish and international buyers at every stage of the transaction, including the estimate of costs and taxes. To receive a personalised selection, contact BARNES Madrid; if you are an owner, you can request a property valuation or learn about our service for selling a property in Madrid.
We welcome you at 15 Calle Velázquez, in the heart of the Salamanca district.
The information in this article is indicative, is drawn from data published by the Community of Madrid (page last updated 23 April 2026, consulted on 6 October 2026) and does not replace personalised tax or legal advice.
