Is Your Imputed Income 1.1% or 2%? The Part the Short Version Leaves Out

Your imputed income is 2 percent of the cadastral value. It drops to 1.1 percent where the property sits in a municipality whose cadastral values were revised through a general collective valuation that came into force in the tax period or in the ten tax periods before it. The test looks at the town. Not at your house. That is the main rule. A separate temporary rule for municipalities revised from 2012 onwards is covered below.

Key facts

So, here is the sentence you will read almost everywhere, in one shape or another.

The rate is 1.1 percent if the cadastral value has been revised, and 2 percent if it has not.

Read it again, slowly. Whose cadastral value?

That is the whole problem, and it is not a quibble. The short version puts the revision on your property. The law puts it on your municipality. Those are two completely different questions, because plenty of Spanish properties get a new cadastral value for reasons that have nothing to do with the town being revalued. You declare an extension. You register a new build. You change the use of the ground floor. A discrepancy gets corrected. Any of those can move your number.

None of them, on their own, gets you to 1.1 percent.

And if you read the short version, look at your paperwork, see the words "valor catastral revisado", and apply 1.1 percent when your town was never generally revalued, you have declared less than you owed. The Modelo 210 is a self assessment. That means the shortfall is yours, not the website's.

What the law actually says

The rule that governs non-resident imputed income sets out three conditions, and all three have to hold at once.

One. The subject is the municipality. The law talks about properties located in municipalities where the cadastral values have been revised, modified or determined. Not about properties whose value has been revised.

Two. It has to be a general collective valuation. Spanish cadastral law knows several ways of changing a value. Only one of them counts here, and it is the biggest one.

Three. It has to be recent. The revised values must have come into force in the tax period itself, or within the ten tax periods before it.

Miss any one of the three and you are on 2 percent.

That is it. That is the whole rule, and it is not ambiguous in Spanish. It gets mangled on the way into English, mostly because "in municipalities where the cadastral values have been revised" is long, and "if the cadastral value has been revised" is short.

Why a revision of your own property does not count

Somebody asked the Spanish tax authorities this exact question, in writing, and got an answer back in 2022.

The situation was the one I have just described. The cadastral value of one specific property had been revised. The municipality had not gone through a general collective valuation inside the window. Which percentage applies?

The answer was 2 percent, not 1.1 percent. Because the individual revision is not what the rule is asking about.

The tax agency says the same thing in its own guidance for non-residents, and it goes one step further: it tells you where to look up the year of your municipality's general collective valuation.

So this is not a grey area, and it is not one of those points where two advisers argue and the truth sits somewhere in between. The tax agency says one thing, consistently, in its guidance and in its answer to that written question. The confusion is entirely on the English language side of the fence, in the abbreviated version that circulates.

Honestly, this is one of the few places in Spanish property tax where I can tell you flatly that a widely repeated sentence is wrong.

What a "general collective valuation" actually is

Here is the sentence that makes the whole thing click.

A general collective valuation sets a new cadastral value for all the urban property in that municipality. Every flat, every villa, every garage, every plot, in one go.

Read that and the rule stops feeling arbitrary. If the exercise revalues an entire town at once, then "has it been revised?" is a question about the town, and it has exactly one answer for everybody who owns there. Your neighbour's answer is your answer. Your garage's answer is your flat's answer.

It also explains why your own building work is irrelevant to it. Your extension changed your value. It did not revalue Denia.

Now, the detail that matters when you go looking.

There are three kinds of collective valuation procedure in Spanish cadastral law. There is the general one, which needs a full ponencia de valores covering the whole municipality. There is a partial one, which covers only certain zones, blocks or estates. And there is a simplified one, for particular situations.

Only the general one triggers 1.1 percent.

The general one also runs on a clock. It cannot be started until at least five years have passed since the previous general procedure came into force, and it is carried out in any case from ten years. So towns do not get revalued every other Tuesday. When it happens, it is a big, slow, town wide exercise, and it leaves a date behind. That date is what you are hunting for.

One more thing people get backwards: the town hall does not set your cadastral value, the Catastro does, and it is the town hall that then uses that value to bill your IBI.

The budget law update is a different animal

The annual budget law can update cadastral values by applying coefficients. Your value moves, and nobody visited your town to do it.

Owners see that and reasonably ask whether it counts.

Spanish law treats two things separately. There is a general collective valuation procedure, and there is an update of cadastral values by coefficients in the annual budget law. The 1.1 percent rate is tied to the first one. What a coefficient update does to the ten period count is not expressly settled in any official source we could cite, so the figure to check is the year of your municipality's last general collective valuation.

I would rather tell you that plainly than give you a confident answer I cannot back up. Go and find the year of the general valuation. That is the number the rule is built on.

How to check your own municipality

This is the part nobody writes down, and it is the only part that actually changes what you type into the form.

There are two official places to look.

The first is the tax agency's list of municipalities with revised cadastral value. It lives in the tax agency's annual income tax manual, indexed province by province, and it tells you the year from which the revised cadastral value applies in each municipality. Find your province, find your town, read the year.

The second is the Ponencias de Valores section of the Catastro portal. The tax agency's own non-resident guidance points you here for the year of a municipality's general collective valuation. It is the primary place, and it is worth using when the list leaves you unsure.

Two cautions, both of which matter.

The list is republished for each filing season, so open the current one rather than a copy you saved in a browser tab two years ago. And notice what its own heading says: it covers values in force from 1 January 2012. That cut off comes from the temporary rule I explain in a moment, not from the ten period rule. So use the list to find the year, and then apply the rule to that year yourself. Do not read the list as an answer to which percentage you pay.

Then count. Read literally, the values have to have come into force in the tax period itself or in the ten tax periods before it. So take the year on the list, take the tax period you are actually filing for, and count back from that period.

Which brings up the thing almost nobody warns about: the window moves. It is not a badge your town wears forever. A town revalued a decade ago is a town that eventually drops out, and on that year the same property, with the same value, with nothing changed by you, can move from 1.1 percent to 2 percent. Whether it actually does, for a town revised from 2012 onwards, is where the temporary rule below comes in. If your percentage suddenly looks different from last year and you cannot see why, that is usually why.

What the difference actually costs

Let us put a number on it. Say your cadastral value is 100,000 euros. Round, invented, and easy to scale to whatever your receipt actually says.

At 1.1 percent:

100,000 x 1.1% = 1,100 euros of imputed income

At 2 percent:

100,000 x 2% = 2,000 euros of imputed income

That is 900 euros of extra taxable income, every single year you own the place, on a number you did not choose and cannot negotiate. Whatever non-resident rate then applies to you, it applies to a base that is almost twice as big.

Two owners. Same cadastral value. Same kind of property. Different town, or the same town in a different year, and the bill is not remotely the same.

If you want to see what that does to your own filing, run your real cadastral value through the instant calculator and see where you land.

The temporary rule, and why we cannot tell you it is in force

There is a second rule sitting on top of the first one, and this is where I have to be careful with you.

A temporary rule extended the 1.1 percent to municipalities revised with effect from 1 January 2012. It was brought in for the 2023 tax year and then extended to 2024.

Now the honest part.

The extension of this temporary rule beyond 2024 was not ratified by Congress, so its formal validity for later tax years is disputed. In practice the tax agency has been applying the 1.1 percent rate under the rules in force on the accrual date, 31 December. This has to be re-checked against the budget legislation in force for each filing season.

So what does that mean for you, in practice?

If your municipality's general revision came into force inside the ten period window, you are on 1.1 percent under the main rule and none of this touches you. Clean.

If it came into force from 2012 but before that window opens, you are in the zone that depends on the temporary rule. That is a point to confirm for the specific year you are filing, against the budget legislation actually in force then. It is not a point to guess at, and it is not a point where last year's answer is automatically this year's answer.

I know that is less satisfying than a table with a tick in it. But a tick I cannot stand behind is worth nothing to you in three years when a letter arrives.

If you have already filed at the wrong percentage

Two very different situations, and people lump them together.

If you filed at 1.1 percent and it should have been 2 percent, you declared less than you owed. The fix is to put in a supplementary return for each year affected, and to do it before anyone writes to you about it. What that means in practice is a whole subject of its own, which is why we set it out in the piece on penalties and surcharges. What I would not do is leave it sitting there hoping it ages out quietly. The 210 is a self assessment, so the shortfall stays yours until you fix it.

If you filed at 2 percent and 1.1 percent was available, you overpaid. That is not fixed by a supplementary return, and it is not automatic. The route, and whether the year you are thinking about is still open, is a case-file question, and I am not going to invent a rule of thumb for it here. Get someone to look at the actual returns before you assume there is money coming back, and be sceptical of anyone who promises you a refund before they have seen the file.

Either way, the first thing to establish is the same thing: the year of your municipality's last general collective valuation. Everything else follows from that.

The other thing this decides for you

Because the rule is about the municipality, one answer covers everything you own in that town.

Your flat and your garage are in the same municipality, so they carry the same percentage. That is worth knowing, because a garage or a storeroom with its own cadastral reference is a separate property in Spanish law, with its own cadastral value, and the tax agency's approach is a separate Modelo 210 for each one. Same percentage, separate returns. If that is news to you, we wrote about the returns owners forget to file.

And while we are here: the cadastral reference and the cadastral value are not the same thing. The reference is the long alphanumeric code that identifies the property. The value is the amount in euros the tax is built on. They sit on the same receipt, a few lines apart, and they get mixed up constantly. If you are not sure which is which, start with how to find your cadastral value.

There is a third number that gets dragged into this, the reference value, and it governs a completely different tax. Your annual return runs on the cadastral value, never on the reference value. We separate the two in cadastral value and reference value.

What to do before you file

Get the cadastral value off your IBI receipt. It is printed there, and that is the number the imputed income is calculated on, which is what the IBI guide walks through. If you do not have the receipt to hand, how to find your cadastral value lists the other places it turns up.

Then look up your municipality, not your property, and write down the year its values came into force.

Then count: is that year inside the tax period you are filing for, or the ten before it?

If yes, 1.1 percent, and you can stop worrying. If no, look at the year. From 2012 onwards you are in the case the temporary rule decides, and that is the one to confirm against the budget legislation for the year you are filing. Before 2012, it is 2 percent, and the honest thing is to check what you declared in previous years too.

For the full picture of how the return is put together once you have the percentage, read the Modelo 210 guide. If you would rather not do any of this yourself, having the imputed income filing handled end to end is exactly what our imputed income service is for. And if you have back years at the wrong percentage, in either direction, that is a conversation with a person before it is anything else.

Where these figures come from

These are the sources used for the factual claims in this article.

This article is general information, not legal or tax advice, and does not create a lawyer–client relationship. Confirm your specific situation with a qualified adviser before acting.