The I.B.I. tax in Spain is ‘Impuesto sobre Bienes Inmuebles’ which could simply be translated as property tax. It is a municipally levied tax and it varies from one on property to another. It is charged annually and the time may vary depending on the location. It is similar to the council tax in the U.K. Valor Catastral is the rateable value of property in Spain and the I.B.I. tax is calculated as a percentage of this value. The Valor Catastral is 
computed after inspecting and evaluating the size, purchase price, construction cost, condition, title, lease details, cost of improvements and location. The rate usually varies from 0.5% to 1.2% of the Valor Catastral value. It depends on the amount of service that you are provided by the town hall and the amount of land and buildings that you have. Someone living in a more rural location would have to pay much less than someone living in a large city because of the services that are provided by the town hall.
Homeowners, owners of agricultural land as well as buildings are all eligible for paying the I.B.I, tax. Be sure to verify whether all the I.B.I. taxes have been cleared before you are buying a resale property and go through the receipts diligently.
You would need to inform the town hall of the new ownership to have it registered under your name. You pay the tax for all the services comprising of roads, garbage removal, and street maintenance. You should usually get reminders before your payment time but do not depend on that as they are usually not very timely or reliable if you get the reminder you take it to the bank and make the payment. If you don’t just visit the town hall but go prepared. They usually require a copy of your last I.B.I. payment and your title deeds. They may even require some documentation sometime so better be safe than sorry. If you are waiting for a reminder they should arrive in the form of a letter or statement sent between June and August and usually allows 6 weeks till payment can be made without a penalty. Legally it is the responsibility of the owner to make the payment so if you don’t get the letter it’s better to just go to the town hall.
The tax collection process is made easy in various parts of Spain by the tax agency S.U.M.A. In that case you can pay via their website. New owners are obligated to register within two months of purchasing a property so don’t procrastinate on this. You are required to visit the town hall with a copy of the title deeds and the last I.B.I. It would not be wise to delay your I.B.I. payment as there is a penalty of around 5-20% depending on your scenario. The longer you take the larger the penalty. It gets more than 10% if you pay after the final notice and delaying it for long enough can result in losing the property so this is pretty serious.
