The Valor Catastral - rating your property
THERE IS something particularly satisfying about eating outside in the sun on Christmas day. Be it a barbecue on your patio or a party on the beach, there’s a joyous sense of ‘we wouldn’t be doing this in the UK would we?’ One of the things we love most about Spain is the fact that all year round you can eke out some sun and eat al fresco be it for breakfast at mid-day or your late evening meal. And you couldn’t beat this New Years Day for providing just that opportunity.
When buying your property you’re not always aware of the significant differences to your pattern of living its aspect might make. For example our neighbours opposite can breakfast outside in the winter whilst our patio is still chilly and in the shade. Come the afternoon and the sun lingers round us for a few hours longer. But it’s not just day-to-day routines that can be transformed by your outlook: it’s your council tax too.
I’ve seen queries raised a few times on forums about why two houses, apparently identical, might be charged different amounts for IBI (Impuesto sobre Bienes Inmuebles). The reason is that your valor catastral (Rateable Value) not only takes account of the size of your property but its exact location and accessibility to amenities too. It is one of two factors that can make a difference as to how much council tax you must pay:
1. Your valor catastral
2. The tax rate charged by the town hall
This is the value assigned to your property for tax purposes. It is a very important figure that is used to calculate your council tax or IBI (Impuesto sobre Bienes Inmuebles) and non-resident imputed income tax. You will find yours on your IBI bill or your receipt if you operate online banking. The value is registered at the Cadastral registry when the property is built. This is a different registry to the Land registry and is usually located either at your town hall or SUMA for those living in the Alicante region. The valor catastral increases annually in line with inflation.
Lots of factors can make a difference to your val.cat. For example, you might have a higher value than your neighbour if your property is closer to the road or your apartment is more convenient for the main entrance. The original valuation will have been made according to information provided by the builder.
The valor catastral is occasionally reviewed. This is done on an area-wide basis and is not a very regular occurrence (approximately every 10 years). When it does happen you can find it takes a leap – and usually in an upwards direction. However, the good news for calculating other taxes such as non-resident income tax, is that the valor catastral is usually much lower than the real market value.
THE TAX RATE
Whatever your valor catastral the actual amount paid is dependent upon the % rate of IBI levied by your local town hall. This tax rate can range from 0.4% to 1.17% and is generally linked to the number of inhabitants in that particular town.
The latest information is that the government’s austerity measures will include an increase in IBI. Whatever the financial pinches and priorities we might find ourselves faced with this year, the sun still comes free - let’s make the most of it in 2012.