Buying & selling · · 10 min read
Madrid IBI Property Tax 2027 and the Catastro Reference Value: What Changes for Homeowners on 1 January 2027
Madrid's IBI property tax falls to 0.4%, the legal minimum, in 2027, and the Catastro's new reference values arrive on 1 January. As of 20 October 2026, we explain what has been approved and what is still pending, how much a typical flat will pay, when the bill is collected, how to look up your reference value and what depends on the 12 November vote.
If you own a home in Madrid, mark 1 January 2027 in your diary. That is when the 2027 IBI (Impuesto sobre Bienes Inmuebles, the annual municipal property tax) starts, and Madrid City Council plans to cut it to 0.4%, the lowest rate the law allows. It is also when the Catastro's new reference values (valores de referencia) take effect, the minimum basis for the taxes paid when you buy, inherit or receive a home as a gift. On top of that, some tax measures in Royal Decree-law 29/2026 apply from that day, provided the decree is validated.
Here is what we know as of 20 October 2026: what has been approved and what is still pending, how much a typical flat will pay, when the bill is collected and how to look up your home's reference value.
Madrid IBI 2027: down to 0.4%, the legal minimum
On 15 October 2026, the Junta de Gobierno (Madrid's city government board) approved the initial draft of the 2027 tax bylaws. The main measure is a cut in the general urban IBI rate from 0.414% to 0.4%, which the City Council describes as the lowest level the law allows (in 2019 it was 0.510%). The cut applies to 2.27 million bills, 1.53 million of them for homes, and taxpayers will pay around 31.2 million euros less in 2027 than in 2026.
IBI is being cut for everyone in Madrid from 0.414% to 0.4%.
Madrid City Council, press release of 15 October 2026
The City Council puts the average 2027 IBI bill at 540 euros for a home with a cadastral value (valor catastral) of 135,134 euros. Don't compare it with the 2026 figure (474.84 euros), which was calculated on a different cadastral value of 119,774.62 euros. To see how much your own bill will fall, use your own cadastral value, shown on your IBI bill. It is neither what you paid nor what your home is worth today.
Example: IBI on a typical Madrid flat in 2026 and 2027
We take a flat with the cadastral value used in the City Council's example, 135,134 euros, with no discounts, and assume that value doesn't change in 2027. The IBI is the cadastral value multiplied by the rate; for the waste collection charge we use the city's average bill.
| Item | 2026 | 2027 (draft) | Difference |
|---|---|---|---|
| General IBI rate | 0.414% | 0.4% | −0.014 points |
| IBI with no discounts | €559.45 | €540.54 | −€18.91 |
| IBI with the 5% Pago a la Carta discount | €531.48 | €513.51 | −€17.97 |
| Waste collection charge (city average bill) | €142.60 | €143.00 | +€0.40 |
| IBI with no discounts + waste charge | €702.05 | €683.54 | −€18.51 |
Our own calculation using the 2026 rate and the rate in the 2027 draft (Madrid City Council). The waste charge is the city's average bill, not this flat's. Pago a la Carta (the council's instalment plan) requires direct debit, and its discount is capped at €70 a year on the IBI.
In percentage terms the rate falls by about 3.4%: roughly 14 euros less a year for every 100,000 euros of cadastral value. According to the City Council, 79% of residential properties in the city have a cadastral value below 150,000 euros.
| Cadastral value | IBI 2026 (0.414%) | IBI 2027 (0.4%) | Saving per year |
|---|---|---|---|
| €100,000 | €414.00 | €400.00 | €14.00 |
| €200,000 | €828.00 | €800.00 | €28.00 |
| €300,000 | €1,242.00 | €1,200.00 | €42.00 |
| €180,000, general large family (90% discount) | €74.52 | €72.00 | €2.52 |
Our own calculation, without Pago a la Carta. Large-family discount based on the 2026 bands reported by TaxDown; the City Council says it remains at up to 90% in 2027.
Discounts and the waste collection charge in 2027
According to the draft, the discounts that matter most to homeowners stay in place:
- Large families (familias numerosas): up to 90% off the IBI on the main home, depending on its cadastral value (in 2026, 90% up to 204,000 euros). Around 37,000 families benefit and, in most cases, it is applied automatically.
- Inheritances: the plusvalía municipal (municipal tax on the increase in land value) on a main home inherited by a spouse, children or parents keeps discounts of up to 95%.
The waste collection charge (tasa de residuos, often called the tasa de basuras) will have a new bylaw. The expected average bill is 143 euros, almost the same as in 2026, but it will also take into account how well rubbish is separated in each of the city's 131 neighbourhoods. Empty homes pay only the basic tariff, provided this is proved each year, and the owner pays the charge, although it can be passed on to the tenant where appropriate.
Timetable: from the Junta de Gobierno to the December plenary
What was approved on 15 October is the initial draft. If last year's procedure is followed, these are the remaining steps:
- Notice in the Boletín Oficial de la Comunidad de Madrid (the regional official gazette) and 30 calendar days of public consultation for objections.
- Approval of the final draft by the Junta de Gobierno (if there are no objections, the initial draft becomes final).
- Approval by the Pleno (the full City Council). The 2026 bylaws were approved at the plenary session of 22 December 2025.
- Publication and entry into force on 1 January 2027.
And when do you pay? The 2027 IBI covers the whole year, but it is collected in the autumn. In 2026, the voluntary payment period for the IBI and the waste charge ran from 1 October to 30 November, and direct-debited bills were charged on the last day. As of 20 October, the 2027 calendar has not been published.
If you'd rather spread the cost, there is Pago a la Carta: you pay by direct debit in instalments, with a discount of up to 5% (maximum 70 euros on the IBI and, in 2027, 15 euros on the waste charge). Applications made between 6 August and 10 December take effect from January of the following year. The alternative, which can't be combined with it, is the Sistema Especial de Pago: two instalments and a 3.25% discount.
Catastro reference values for 2027: what has already been published
The Catastro (Spain's property register for tax purposes) calculates a reference value for every property each year, based on sales signed before a notary and capped at market value. Since 2022 it has been the minimum basis for the ITP (Impuesto sobre Transmisiones Patrimoniales, the transfer tax paid by buyers of resale homes) and for Inheritance and Gift Tax (Impuesto sobre Sucesiones y Donaciones). It is not the cadastral value on your IBI bill. The timetable for 2027:
- 24 September 2026: the BOE (Spain's official gazette) publishes the Catastro's notice opening a ten-day collective consultation on the elements used to calculate urban reference values for 2027.
- 25 September: the Catastro's online portal (Sede Electrónica) publishes the 2027 value maps and annual property market reports.
- Before 30 October: the resolution setting those elements is published (the 2026 one is dated 27 October 2025).
- First 20 days of December: notice in the BOE (the 2026 one appeared on 16 December 2025).
- 1 January 2027: each property's value can be looked up on the Sede Electrónica.
How to look up your home's reference value
- Find the referencia catastral (cadastral reference number) on your IBI bill or in your deed.
- Go to the Sede Electrónica del Catastro, section Valor de referencia, and identify yourself with a digital certificate, electronic ID card (DNI electrónico) or Cl@ve (the Spanish government's online login).
- Choose the year: you can already see 2026 and, from 1 January, 2027. If you are the owner, you can download a certificate and the certificado de motivación, which explains how the value was calculated.
- Offline: the Catastro helpline (Línea Directa del Catastro, 91 387 45 50) or a Catastro office (Gerencia) by appointment.
Why it matters when you buy, sell, inherit or give a home
When you buy a resale home in the Madrid region you pay 6% ITP (4% for large families buying their main home, subject to conditions). The basis is the reference value unless the price in the deed is higher. And the value that counts is the one on the date of the deed: a sale signed on 30 December 2026 uses the 2026 value; one signed on 4 January 2027 uses the 2027 value.
| Price in the deed | ITP basis | ITP at 6% |
|---|---|---|
| €300,000 | €320,000 (reference value) | €19,200 |
| €320,000 | €320,000 | €19,200 |
| €350,000 | €350,000 (price) | €21,000 |
Illustrative example: a flat with an assumed reference value of €320,000 and the Madrid region's general rate of 6%. In the first case, the buyer pays €1,200 more than if the tax were based on the price.
Even though the buyer pays the ITP, it matters to the seller too: an informed buyer will check the reference value before making an offer. For inheritances and gifts, the reference value is also the minimum basis for Inheritance and Gift Tax; we explain Madrid's discounts in “How much does it cost to inherit a property in Madrid in 2026? Notary, Land Registry, taxes and lawyer”.
What doesn't change: the reference value does not affect the cadastral value or the IBI, nor is it the basis for the plusvalía municipal (which uses the cadastral value of the land) or for the seller's income tax, IRPF (which taxes the difference between what you paid and what you receive). We cover this in “Taxes When Selling a Flat in Spain in 2026: Plusvalía Municipal in Madrid, Income Tax (IRPF) and Exemptions”.
What if it is higher than your home is really worth? It can only be challenged when it affects a tax, by asking for the self-assessment to be corrected or by appealing the tax assessment. In February 2026, Spain's Constitutional Court unanimously upheld the system (judgment 13/2026), but noted that taxpayers can prove a different value with no limit on evidence. This usually requires an expert report, so it's worth weighing up whether it pays off.
Other changes on 1 January 2027 and what depends on 12 November
Royal Decree-law 29/2026, in force since 8 October, includes tax measures for owners, several of them effective from 1 January 2027. All of them depend on the decree being validated by the Diputación Permanente (the standing committee of the Spanish Congress); according to published reports, the vote is scheduled for 12 November. If it is not validated, it is repealed and the previous rules return.
- Homes that are neither let nor your main residence: from 1 January 2027, the deemed income (imputación de rentas) taxed under IRPF will be calculated on a scale of 1.1%, 1.5%, 2% and 3% of the combined cadastral values.
- Letting to relatives: from the same date, if the tenant is your spouse or a relative up to the third degree, the rental income you declare cannot be lower than a minimum based on that deemed income.
- IBI surcharge on empty homes: the decree changes its conditions for tax periods starting after 8 October 2026, that is, from the 2027 IBI onwards. Each city council has to approve it, and Madrid's statement on the 2027 bylaws doesn't mention it.
- 10% rent deduction: the decree brings back a state income tax deduction of up to 1,163 euros a year for tenants with a taxable base below 33,007.20 euros. It is for the person paying the rent and also depends on validation.
What to do before 1 January
- Multiply the cadastral value on your IBI bill by 0.004: that is your 2027 IBI without discounts, if the value doesn't change.
- To pay in instalments from January, sign up for Pago a la Carta before 10 December.
- If you are a large family, check that your large-family certificate will be valid on 1 January.
- If you are selling or buying around the turn of the year, compare the 2026 and 2027 reference values before setting the date of the deed, and agree in writing who pays the IBI.
- If you have an empty flat or let one to a relative, review the new deemed-income rules with your adviser.
How we do it at Llavely
At Llavely, with more than 35 years in the property sector and specialist lawyers, we sell your home in the Madrid region with everything included: valuation, photos, video, floor plan and virtual tour. We talk to every buyer and check their ID before the viewing; we carry out the viewings ourselves and you follow them from your private seller portal. If the buyer needs a mortgage, we put them in touch, free of charge, with a mortgage broker. And we check your identity and ownership using the nota simple (land registry extract showing who owns the property and any charges on it) or your purchase deed.
Our specialist lawyers are with you from start to finish: they review the nota simple, any charges and debts, calculate the taxes that apply, draft the arras contract and any special clauses where needed, review the deed and go with you in person to the notary. All payments are made by ordinary bank transfer or OMF (orden de movimiento de fondos, the interbank payment used at the notary's office), never in cash. You only pay if you sell, on the day of signing at the notary: 2.5% + VAT of the price, in total, with everything included. Buying with Llavely is free.
A lower IBI or a new reference value shouldn't decide on their own when you sell, but they are worth bearing in mind when you set the price and the signing date. If you'd like to know what your home is worth now, ask for your free valuation: we give you a price range straight away, then we call you (we reply in English by email, message or phone), see the property and fine-tune the price.
Frequently asked questions
How much will IBI fall in Madrid in 2027?
The general rate goes from 0.414% to 0.4%, the legal minimum, under the draft approved by the Junta de Gobierno on 15 October 2026. That is about 14 euros less for every 100,000 euros of cadastral value. For a home with a cadastral value of 135,134 euros, the bill would go from 559.45 to 540.54 euros, without discounts.
Has the 2027 IBI cut already been approved?
As of 20 October 2026, not definitively. The Junta de Gobierno approved the initial draft; the public consultation and approval by the full City Council are still to come. The 2026 bylaws were approved at the plenary session of 22 December 2025, and the 2027 ones are intended to apply from 1 January.
When is the 2027 IBI paid in Madrid?
The 2027 calendar has not been published yet. In 2026, the voluntary payment period ran from 1 October to 30 November, with direct-debited bills charged on the last day. If you sign up for Pago a la Carta before 10 December 2026, you can pay in instalments from January with a discount of up to 5% (maximum 70 euros).
How much is the waste collection charge in Madrid in 2027?
The expected average bill is 143 euros, practically the same as in 2026 (142.60 euros). Each bill depends on the cadastral value, the waste generated, the number of registered residents and, as a new factor, how well rubbish is separated in your neighbourhood. Empty homes pay only the basic tariff, provided this is proved each year.
Where can I look up my home's reference value?
On the Catastro's Sede Electrónica, identifying yourself with a digital certificate, electronic ID card or Cl@ve. You can see the 2026 value now; the 2027 value will be available from 1 January 2027. You can also call the Catastro helpline (91 387 45 50) or book an appointment at a Catastro office.
Does the reference value increase IBI or the plusvalía?
No. The reference value does not change the cadastral value, which is what is used for IBI and the plusvalía municipal. It applies as the minimum basis for ITP and for Inheritance and Gift Tax. Nor is it the basis for the seller's income tax (IRPF).
If I sell in January 2027, which reference value applies?
The one in force on the date of the deed. If you sign on or after 1 January 2027, the buyer will pay ITP on the higher of the price and the 2027 reference value. If you sign earlier, the 2026 value applies.
If I sell my flat in 2027, who pays that year's IBI?
As far as the City Council is concerned, whoever owned it on 1 January, for the whole year. Seller and buyer can agree otherwise in the arras contract or in the deed, for example sharing it according to the number of days each of them owns the property.
Sources
- The City Council cuts IBI to 0.4%, the lowest level allowed by law (Diario de Madrid, Madrid City Council, 15 October 2026)
- The City Council cuts IBI and approves the waste collection charge for 2026 (Diario de Madrid, Madrid City Council, 23 October 2025)
- Madrid will cut IBI in 2027 but keeps the waste charge: how much residents will pay (Infobae, 15 October 2026)
- Madrid will cut IBI to the legal minimum in 2027 and keep the average waste charge at 143 euros (El Diario de Madrid, 15 October 2026)
- Initial draft amending the IBI tax bylaw for 2026, text submitted for public consultation (Madrid City Council, Junta de Gobierno, 23 October 2025)
- Municipal tax bylaws and public prices 2026, including the General Tax Bylaw on Management, Collection and Inspection (Madrid City Council)
- Madrid IBI 2027 calculator: the rate would go from 0.414% to 0.4% (TaxDown, 15 October 2026)
- Notice from the Dirección General del Catastro opening the collective consultation on reference values for urban properties in 2027 (BOE, 24 September 2026)
- Reference value: look-up, value maps and 2027 property market reports (Sede Electrónica del Catastro)
- Notice from the Dirección General del Catastro on reference values for urban properties for 2026, BOE of 16 December 2025 (derecho.com)
- Third final provision of the consolidated Cadastre Law: the reference value (Iberley)
- The Constitutional Court unanimously dismisses the challenge to the Catastro reference value, judgment 13/2026 (Fiscal Impuestos, 13 February 2026)
- How to challenge the reference value (OCU, Spain's consumer organisation, 1 April 2026)
- Transfer tax on property sales, Transmisiones Patrimoniales Onerosas (Comunidad de Madrid, updated 23 April 2026)
- Main tax changes in Royal Decree-law 29/2026 of 6 October (Agencia Tributaria, Spanish Tax Agency, October 2026)
- New housing tax measures in Royal Decree-law 29/2026 (Iberley, October 2026)