Last March, the Government of the Generalitat of Catalonia approved Decree-Law 5/2025 of 25 March, adopting urgent measures in tax matters, staff expenditure and other administrative matters.
Among its most notable reforms is that of the Property Transfer Tax (Impuesto sobre Transmisiones Patrimoniales - ITP) regime, which introduces a progressive rate structure, abolishes tax reliefs and establishes a specific levy for certain operators, particularly large landlords and companies acquiring entire buildings intended for residential use.
These amendments, which will enter into force on 27 June 2025 (except for the provisions with immediate application), are intended to move towards greater progressivity and tax fairness in the second-hand housing purchase and sale market in Catalonia.
New tax rate structure
Until now, the ITP in Catalonia applied a general rate of 10 % and a reduced rate of 5 % for young people under 32 years of age. The reform expands and modifies this scheme as follows:
The reduced rate of 5 % will apply to people up to the age of 35 (previously 32), provided their gross annual income does not exceed €36,000.
A progressive type structure is introduced according to the value of the property:
- Up to €600,000: 10 %.
- From 600,000 € to 900,000 €: 11 %.
- From €900,000 to €1,500,000: 12 %.
- Over €1,500,000: 13 %.
This scale seeks to adapt the tax effort to the value of the transaction, favouring purchasers of lower-value property and reinforcing the redistributive component of the tax.
Aggravated 20% surcharge for large property owners and transfers of entire buildings
One of the most relevant elements of the new regime is the introduction of an aggravated rate of 20 % in the following cases:
- Acquisition of residential properties by large-scale landlords, as defined under current regulations in Catalonia.
- Transfer of entire buildings intended for residential use, regardless of whether or not they have been subjected to horizontal property division.
An exception is envisaged for individuals who acquire the property to use as their main residence, provided they meet the income requirements established by regulation.
Abolition of bonuses for real estate operators
The reform expressly eliminates the 70 % reduction in transfer tax that has until now benefited real estate companies in certain acquisitions. Unlike the rest of the measures, this provision came into force immediately on 27 March 2025, the day after the Decree-Law was published in the DOGC.
With this abolition, the Catalan legislature intends to prevent indiscriminate tax advantages and align the sector's taxation with objectives of general interest and tax justice.
If you need to assess how these reforms may affect your operations or real estate assets, we at Busquets will be delighted to help you. You can contact us by calling 934 160 004 or sending an email to info@busquets.legal and we will support you with whatever you need.