Plusvalía Municipal in Spain Explained for Foreign Owners
Plusvalía municipal is the tax foreign owners on the Costa Blanca understand least and argue about most. Its official name is the Impuesto sobre el Incremento de Valor de los Terrenos de Naturaleza Urbana (IIVTNU), and everything follows from that name: it taxes the increase in the value of urban land — never the building — that surfaces when a property changes hands by sale, inheritance or gift. It is levied by the ayuntamiento, not by the Tax Agency, and each town hall fixes its own rate and coefficients within the Local Finance Act. Since the Constitutional Court struck down the old automatic formula in ruling 182/2021, the law offers two ways to compute the base and lets you pay on the lower; where the land produced no gain, nothing is due. This guide explains who pays, how the two methods work, the deadlines, inheritances and gifts, the link with the 3% retention and modelo 210, how to declare at the town hall, and how to appeal.
Quick answer
Plusvalía municipal (IIVTNU) is a town-hall tax on the increase in the value of the land under a property. The seller pays on a sale, the heir on an inheritance, and the buyer answers for it when the seller is a non-resident individual. Since STC 182/2021 you pay on the lower of two methods; no gain, no tax.
Reviewed by
Valery Grinkevich
Licensed economist · tax adviser · 20+ years of experience · Torrevieja, Costa Blanca
Key takeaways
- Plusvalía taxes the increase in the value of the urban land only, between acquisition and transfer (art. 104.1 TRLRHL). The building is irrelevant.
- The seller pays on a sale; the heir or donee on an inheritance or gift. When the seller is a non-resident individual, the buyer is the substitute taxpayer (art. 106 TRLRHL).
- Two methods since STC 182/2021 and RDL 26/2021: objective (cadastral land value × the coefficient set by your ayuntamiento) or real gain (the actual increase, apportioned to the land). You pay on the lower; no gain, no tax (arts. 104.5 and 107.5).
- The rate is set by each ayuntamiento and may never exceed 30% (art. 108.1). Coefficients, rate and reliefs live in the ordenanza fiscal — never assume a figure; run the calculator or read the ordinance.
- Deadlines: 30 business days for sales and gifts, 6 months for inheritances, extendable to a year (art. 110.2). Late filing costs the LGT surcharge.
On this page
- What plusvalía municipal is — and what it actually taxes
- Who pays: seller, heir, donee — and the buyer as substitute
- The ingredients: cadastral land value, years held and the ordinance
- The two methods since STC 182/2021: objective vs real gain
- The 30% ceiling, per-period rates and the reliefs
- Deadlines: 30 business days, 6 months, and what late filing costs
- Inheritances and gifts: the heir pays, and the clock runs from death
- How plusvalía meets the 3% retention and modelo 210
- Declaring at the town hall, and appealing when it gets it wrong
- Plusvalía on the Costa Blanca: Torrevieja, Orihuela Costa and the calculator
- How to settle the plusvalía after a sale, step by step
- Frequently asked questions
What plusvalía municipal is — and what it actually taxes
The IIVTNU is a direct municipal tax on the increase in value that urban land experiences and that surfaces when its ownership is transferred by any title, or when a real right of enjoyment over it is created or transferred (art. 104.1 of the consolidated Local Finance Act, TRLRHL). The taxable event is the transfer itself — a sale, an inheritance, a gift, a usufruct. Between transfers the tax sleeps, however much the land appreciates.
The word that matters is land. The tax ignores the construction: for an apartment in Benidorm the land is a small share of the cadastral value, for a villa on a large plot in Orihuela Costa it can be the larger part, which is why two properties sold for the same price produce very different bills. Land classed as rústico for IBI is not subject (art. 104.2), nor are contributions between spouses to the marital property regime or transfers under a divorce or separation judgment (art. 104.3).
Tip
Your IBI receipt splits the cadastral value into valor catastral del suelo and valor catastral de la construcción. The first figure is the one the plusvalía is built on.
Who pays: seller, heir, donee — and the buyer as substitute
In a transfer for value — a sale — the taxpayer is the person who transfers the land, the seller (art. 106.1.b TRLRHL). In a transfer for free — an inheritance or a gift — the taxpayer is the person who acquires it, the heir or the donee (art. 106.1.a). The tax follows whoever ends up with the money or the asset.
One twist matters more on the Costa Blanca than anywhere else. When the seller is an individual not resident in Spain, the buyer becomes the substitute taxpayer (art. 106.2 TRLRHL): the town hall claims from the buyer, who may then recover what they paid from the seller (art. 36.3 LGT) — which is why the estimated plusvalía is routinely held back from the price at the notary. The rule covers only sales by non-resident individuals; a non-resident company, non-resident heirs and resident sellers are taxpayers themselves. A contract clause saying “the buyer pays the plusvalía” binds the parties between themselves but never changes who the ayuntamiento can pursue.
The ingredients: cadastral land value, years held and the ordinance
Three inputs drive the objective calculation: the cadastral value of the land at the date of transfer, as fixed for IBI (art. 107.2.a TRLRHL); the number of full years held, up to twenty, with fractions of a year dropped and holdings under a year prorated by complete months (arts. 107.1 and 107.4); and the ordenanza fiscal of the ayuntamiento, which fixes the coefficient for each holding period and the rate.
The coefficients are not national figures. The law publishes maximum coefficients per holding period and updates them yearly; each ayuntamiento approves its own, equal to or lower than the maxima, and if a State update leaves an ordinance above the ceiling, the ceiling applies directly (art. 107.4). That is why no serious adviser quotes “the plusvalía rate in Torrevieja” as a fixed number: the correct figure is the one in the ordinance in force on the date of transfer, and our calculator applies it to both methods.
The two methods since STC 182/2021: objective vs real gain
Until 2021 the base came from a single formula that presumed the land had always gained value. In ruling 182/2021 of 26 October 2021 the Constitutional Court declared it — the second paragraph of art. 107.1, art. 107.2.a and art. 107.4 TRLRHL — unconstitutional and void, because taxing a gain that may not exist breaches the principle of ability to pay. Real Decreto-ley 26/2021 of 8 November, in force since 10 November 2021, rewrote the articles and gave ayuntamientos six months to adapt their ordinances.
Objective method (arts. 107.1 and 107.4): cadastral land value at transfer × the coefficient your ayuntamiento approved for the years held. Real-gain method (arts. 104.5 and 107.5): transfer value minus acquisition value — the higher of the deed value and any value verified by the tax authority, without counting costs or taxes — multiplied by the share of the land in the total cadastral value. If, at your request, the real increase is lower than the objective base it becomes the base; if there is no increase at all the transfer is not subject. You must declare and produce both deeds; for inherited or gifted property the acquisition value is the one declared for inheritance and gift tax.
Example
Generic example. Total cadastral value €120,000, of which land €48,000 (40%). Bought for €150,000, sold twelve full years later for €200,000. Real-gain base: (€200,000 − €150,000) × 40% = €20,000. Objective base: €48,000 × the coefficient your ayuntamiento sets for 12 years. The lower base × the rate your ayuntamiento sets (never above 30%). Sold for €140,000? No gain, no plusvalía.
The 30% ceiling, per-period rates and the reliefs
The rate is fixed by each ayuntamiento and may not exceed 30% (art. 108.1 TRLRHL); within that ceiling the town hall may set one rate or one per holding period. The full tax is the base multiplied by the rate, and the net tax is what remains after any relief the ordinance grants (arts. 108.2 and 108.3).
Two optional reliefs exist, both up to 95% and both only if the ordinance provides for them: transfers on death to descendants, spouses and ascendants (art. 108.4), which many town halls grant for the family home with conditions on keeping it, and land used for activities of special municipal interest (art. 108.5). The same inherited flat can therefore carry a heavy bill in one town and almost none in the next; a relief not claimed in time is usually lost.
Deadlines: 30 business days, 6 months, and what late filing costs
The tax accrues on the date of the transfer — the deed of sale or gift, or the date of death (art. 109.1 TRLRHL). The taxpayer files within thirty business days for transfers between living persons and within six months for transfers on death, extendable to a year on request (art. 110.2); business days exclude Saturdays, Sundays and holidays (art. 30.2 Ley 39/2015). Where the ayuntamiento uses self-assessment — most large Costa Blanca municipalities do — you also pay within that deadline (art. 110.4); otherwise it notifies an assessment (art. 110.5). The buyer in a sale and the donor in a gift must notify the ayuntamiento within the same deadlines (art. 110.6).
Nothing stays hidden: notaries send every ayuntamiento a quarterly index of the deeds that trigger the tax and must warn the parties about the deadline (art. 110.7). A declaration filed late but before any demand carries the art. 27 LGT surcharge — 1% plus 1% per complete month of delay, and 15% plus interest after twelve months — while a demand that arrives first opens the door to a penalty.
Watch out
The six-month extension for inheritances is not automatic and is separate from the inheritance-tax extension. Ask the ayuntamiento in writing before the first six months run out.
Inheritances and gifts: the heir pays, and the clock runs from death
When a property passes on death, the heir or legatee is the taxpayer (art. 106.1.a TRLRHL) and the tax accrues on the date of death, not on acceptance of the estate (art. 109.1); six months, extendable to a year, is the window (art. 110.2.b). Non-resident heirs are taxpayers themselves — the substitute rule covers only sales — so they file with the ayuntamiento directly, usually through a representative. Under the real-gain method the acquisition value is what the deceased paid and the transfer value is the one declared for inheritance tax, so a property bought at the 2007 peak and inherited today may show no gain in the land at all.
Gifts work like inheritances for the taxpayer — the donee pays (art. 106.1.a) — but like sales for the deadline: thirty business days from the gift deed (art. 110.2.a), with the donor notifying too (art. 110.6.a). A gift also resets the clock for the donee’s later sale. Our guide to inheritance tax in the Valencia region covers the succession itself; the plusvalía is the parallel file at the town hall.
How plusvalía meets the 3% retention and modelo 210
When a non-resident sells, three taxes converge on completion day. The 3% retention is a State payment on account of the seller’s non-resident income tax, withheld by the buyer and paid to AEAT on modelo 211 within one month (art. 25.2 TRLIRNR); the seller’s tax on the gain is settled on modelo 210 within three months once that month has elapsed; the plusvalía is a municipal tax with its own base, deadline and creditor. Paying one has no effect on the others.
They meet in the seller’s arithmetic. Non-resident gains follow the personal income tax rules (art. 24.4 TRLIRNR), which deduct from the transfer value the taxes inherent to the transfer borne by the seller (art. 35.2 LIRPF): the plusvalía the seller economically bears — paid directly or held back from the price by the buyer as substitute — reduces the gain on modelo 210, so keep the receipt. The reverse is not true: the real-gain method disregards the costs and taxes of acquisition and transfer (art. 104.5), so the 3% retention, the ITP paid on purchase and the notary cannot shrink the plusvalía base.
Declaring at the town hall, and appealing when it gets it wrong
The plusvalía is declared and paid to the ayuntamiento of the municipality where the property sits — the Ayuntamiento de Torrevieja for a flat in Torrevieja, the Ayuntamiento de Orihuela for a villa in Orihuela Costa. You complete the town hall’s form, increasingly online, attach the deed of transfer, the deed by which the transferor acquired and, for the real-gain method, the evidence of both values, and apply for any relief or extension at the same time. Non-residents file through a representative; spainfiscal prepares both methods against the ordinance in force, files with the ayuntamiento and keeps the receipt that feeds modelo 210.
An assessment can be challenged only by recurso de reposición before the ayuntamiento, within one month from the day after notification (art. 14.2 TRLRHL); no lawyer is required. If you self-assessed on the objective base and the real gain was lower or nil, you ask instead for rectification of the self-assessment and a refund (art. 120.3 LGT) within the four-year limitation period (art. 66 LGT). A sale later annulled by a final ruling gives a right to a refund within five years (art. 109.2). One limit: the Constitutional Court itself declared that assessments final on 26 October 2021, and self-assessments whose rectification had not been requested by then, cannot be reopened.
Plusvalía on the Costa Blanca: Torrevieja, Orihuela Costa and the calculator
On the Costa Blanca the plusvalía is a tax of the resale market. In Torrevieja most of what changes hands has been bought once already, so the IIVTNU comes up in almost every transaction, and most sellers are non-residents — so the buyer is the substitute taxpayer in most Torrevieja sales. Our Torrevieja page (/destino/torrevieja) explains who bills what in the town, and the Costa Blanca hub (/destino/costa-blanca) covers the municipalities from Dénia to Pilar de la Horadada.
Each ayuntamiento — Torrevieja, Orihuela, Alicante, Benidorm, Altea, Calpe, Jávea, Dénia — sets its own coefficients and rate, so an identical gain on identical land produces a different bill from one town to the next; the mechanism is identical everywhere. Take the cadastral land value from the IBI receipt, count the full years held, run both methods against the current ordinance in our calculator (/services/plusvalia), and only then agree the retention with the other side. Anyone who quotes a figure without naming the ordinance and the date of transfer is guessing.
Tip
Before completion, ask for a written plusvalía estimate under both methods, citing the ordinance and the year. If the seller is a non-resident individual, the buyer should retain exactly that amount — not a round figure “to be safe”.
Step-by-step
How to settle the plusvalía after a sale, step by step
Identify the taxpayer and the substitute
The seller pays; if the seller is an individual not resident in Spain, the buyer is the substitute and must file (art. 106 TRLRHL). Agree in the contract who files and how the buyer recovers the amount.
Collect the figures
Cadastral land value and total cadastral value from the IBI receipt; acquisition date and value from the seller’s purchase deed; transfer date and price from the new deed; full years held.
Run both methods against the ordinance
Compute the objective base (land value × the ayuntamiento’s coefficient) and the real-gain base (increase × land share) with the calculator or the ordinance in force. Keep the lower; if there is no gain, the transfer is not subject.
File with the ayuntamiento within thirty business days
Submit the town hall’s form with the deed of transfer and, for the real-gain method, the acquisition deed. Apply for any relief at the same time (art. 110 TRLRHL).
Pay or await the assessment
Under self-assessment, pay within the same deadline; otherwise within the period stated in the notified assessment. Late filing before a demand carries the art. 27 LGT surcharge.
Keep the receipt for modelo 210
The plusvalía the seller bears reduces the non-resident capital gain (art. 24.4 TRLIRNR; art. 35.2 LIRPF). File the receipt with the modelo 211 copy and the deeds.
| Objective method | Real-gain method | |
|---|---|---|
| Legal basis | Arts. 107.1 and 107.4 TRLRHL | Arts. 104.5 and 107.5 TRLRHL |
| Starting point | Cadastral land value at transfer | Transfer value minus acquisition value (no costs or taxes) |
| Adjustment | × coefficient set by your ayuntamiento for the full years held (max. 20) | × share of land in the total cadastral value |
| Example base | €48,000 × coefficient your ayuntamiento sets for 12 years | (€200,000 − €150,000) × 40% = €20,000 |
| Tax | Lower base × rate set by your ayuntamiento (never above 30%) | Same rule |
| When there is no gain | Would still produce a bill | Not subject — no tax (art. 104.5) |
FAQ
Frequently asked questions
What is plusvalía municipal in Spain?
Plusvalía municipal is the tax on the increase in the value of urban land (IIVTNU) that a town hall charges when a property is sold, inherited or given away. It taxes only the land, not the building, and each ayuntamiento sets its own rate and coefficients within the Local Finance Act (art. 104 TRLRHL).
Who pays the plusvalía when a property is sold?
The seller (art. 106.1.b TRLRHL). When the seller is an individual not resident in Spain, the buyer is the substitute taxpayer: the town hall pursues the buyer, who may recover the amount from the seller (art. 106.2 TRLRHL; art. 36.3 LGT), in practice by holding it back from the price.
Does the buyer ever pay the plusvalía?
Legally only as substitute when the seller is a non-resident individual (art. 106.2 TRLRHL). The parties may agree that the buyer bears it, common in new-build sales, but that binds them between themselves and does not change who the ayuntamiento can pursue.
How is plusvalía calculated after the Constitutional Court ruling?
Two ways, and you pay on the lower. The objective method multiplies the cadastral land value by the coefficient your ayuntamiento set for the years held (art. 107 TRLRHL); the real-gain method takes the actual increase, apportioned to the land (arts. 104.5 and 107.5). The rate cannot exceed 30%.
Do I pay plusvalía if I sell at a loss?
No. Since STC 182/2021 and Real Decreto-ley 26/2021, a transfer with no increase in the value of the land is not subject to the tax (art. 104.5 TRLRHL). You must still declare the transfer and prove the values with the deeds; the exemption is not automatic.
What is the deadline to pay plusvalía municipal?
Thirty business days from the transfer for sales and gifts, and six months from the death for inheritances, extendable to one year on request (art. 110.2 TRLRHL). Late filing before any demand carries the art. 27 LGT surcharge of 1% plus 1% per complete month.
Is plusvalía due on an inherited property?
Yes, the heir or legatee pays it (art. 106.1.a TRLRHL) within six months of the death, extendable to a year. Many ayuntamientos grant a relief of up to 95% for transfers on death to descendants, spouses and ascendants if their ordinance provides for it (art. 108.4).
How much is the plusvalía rate?
There is no national rate. Each ayuntamiento fixes its own, up to the statutory ceiling of 30% (art. 108.1 TRLRHL), and its own coefficients within the State maxima (art. 107.4). The correct figure is the one in the ordinance in force on the date of transfer — use the calculator or read the ordinance.
Does the 3% retention cover the plusvalía?
No. The 3% retention is a State payment on account of the seller’s income tax, paid to AEAT on modelo 211; the plusvalía is a municipal tax paid to the ayuntamiento. The plusvalía the seller bears does reduce the capital gain declared on modelo 210.
Can I get a refund of plusvalía I already paid, or appeal an assessment?
If you self-assessed on the objective base and the real gain was lower or nil, ask the ayuntamiento to rectify the self-assessment and refund the excess within four years (arts. 120.3 and 66 LGT). An assessment is appealed by recurso de reposición within one month (art. 14.2 TRLRHL). Payments final on 26 October 2021 cannot be reopened.
Related services
Sources
- BOE — TRLRHL, Real Decreto Legislativo 2/2004, Local Finance Act (arts. 104-110: IIVTNU; art. 14: appeals)
- BOE — Real Decreto-ley 26/2021 (IIVTNU reform after STC 182/2021)
- BOE — Constitutional Court ruling 182/2021 of 26 October (nullity of the objective base)
- BOE — Ley 58/2003, General Tax Act (arts. 27, 36, 66 and 120.3)
- BOE — TRLIRNR, Real Decreto Legislativo 5/2004 (arts. 24.4 and 25.2)
- BOE — Ley 39/2015 (art. 30: computation of business days)
Last updated: 2026-09-04