This is a website for buyers, owners, and sellers of property in Spain, offering reliable information and resources to help you get things done with confidence. It is run by Mark Stücklin, author of the Spanish Property Doctor Column in The Sunday Times (2005-2008), and the book ‘Need to Know: Buying Property in Spain’ published by Collins.
If you’re renting a property in Spain as a tenant, you might be surprised to learn that you are legally required to pay a small tax known as the Impuesto sobre Transmisiones Patrimoniales (ITP). This guide explains what it is, how it’s calculated, and what steps you need to take to stay compliant.
What is the ITP for rental contracts?
The ITP is a tax on certain civil and legal transactions, including residential rental contracts. Although commonly associated with property purchases, Spanish tax law also requires tenants to pay ITP when signing a lease.
This obligation is set out in Real Decreto Legislativo 1/1993, which states that the tenant (arrendatario) is responsible for paying the ITP on rental agreements.
Is it really enforced?
In practice, many tenants are unaware of this tax and do not pay it. Enforcement is limited, and the tax is rarely pursued unless a lease is reviewed by the tax office for another reason.
That said, it remains a legal obligation, and in some regions, the ITP may be necessary for registering the lease or taking legal action under its terms. Penalties for non-compliance can include interest and a fine, usually proportional to the unpaid amount.
Who pays the ITP?
The ITP must be paid by the tenant, not the landlord. This includes:
- Filing the required tax form (usually Modelo 600)
- Calculating the correct amount of tax
- Paying the tax to the relevant regional tax authority
How is the tax calculated?
The amount of ITP due depends on the total rent due over the entire lease period, multiplied by a regional tax rate (typically 0.5%). The calculation assumes a minimum lease term of one year, even if the contract is shorter.
Basic formula:
Monthly rent × number of years (rounded up) × tax rate (usually 0.5%)
Example:
- Monthly rent: €1,000
- Lease term: 3 years
- Tax base: €1,000 × 12 months × 3 years = €36,000
- ITP (at 0.5%): €180
Some regions apply different rates or offer exemptions for certain tenants (e.g. under 35s, low-income households, or first-time renters). You should check with your regional tax authority for current rates and possible reductions.
How do I pay it?
- Complete the Modelo 600 form, available online or at the regional tax office (Hacienda Autonómica).
- Identify the transaction as an “arrendamiento de vivienda” (residential lease).
- Calculate the tax and enter it on the form.
- Submit the form and pay the tax, usually at a collaborating bank or online if available.
- Keep proof of payment.
Some regions allow this process to be done entirely online.
What happens if I don’t pay?
If the tax office becomes aware of an unpaid ITP, they may demand payment plus interest and impose a penalty. The risk of this is low, but it does exist — particularly if the lease needs to be registered, or if a dispute arises and the contract is scrutinised.
Penalties are generally proportional to the unpaid amount and can range from 50% to 150% of the tax due, depending on whether the omission was voluntary or detected during an audit.
Summary
- The ITP is a legal requirement for residential leases in Spain.
- It is the tenant’s responsibility to pay it, usually by filing Modelo 600.
- The tax is based on the total rent payable over the lease and is typically around 0.5%.
- Although rarely enforced, non-compliance can lead to penalties.
- Filing and paying the tax is relatively simple and may help avoid complications later.
If in doubt, consult a gestor or your regional tax office for assistance.
