Óscar Pineda is selling a penthouse in the centre of Granada and another flat, almost identical in price, in a new district on the outskirts. When he prepares the two plusvalías (the plusvalía municipal is the local tax on the increase in value of urban land) with the actual method, he is in for a surprise: the gain in price is similar in both, but the increase in the land for the penthouse is more than double. The reason is not in the deeds but in a line of the IBI bill (the annual council property tax) that almost nobody looks at: the one that separates the value of the land from the value of the building.
Why land and building have to be separated
The municipal plusvalía taxes only the increase in value of the land. The building ages and loses value, but the tax takes no account of it, for better or for worse. When someone sells a flat, the price mixes the two things, and you have to decide what part corresponds to the land.
To avoid arguing about valuations case by case, article 104.5 of the consolidated text of the Local Government Finance Act (TRLRHL) sets a single rule: the value of the land is the one that results from applying to the price "the proportion that the cadastral value of the land represents of the total cadastral value on the date the tax falls due". That same proportion is applied to the purchase price. Article 107.5 refers to that rule for the actual method.
Where to find the proportion
The figure is in three places, in order of convenience:
- The IBI bill. Many councils and tax collection bodies break the cadastral value (the official value set by the Cadastre, Spain's property register for tax purposes) down into land and building. You just divide the first by the total.
- The descriptive and graphic certificate from the Cadastre. You can obtain it on the Cadastre's online portal with a digital certificate or the Cl@ve login system, or a representative can request it. It includes the cadastral value and its breakdown.
- The notification of cadastral values you received after a general revaluation, if you have kept it.
What does not work is a generic percentage of "land in that area", a bank valuation, or the proportion used for IRPF (Spanish personal income tax) to calculate depreciation on a rental. Even if it comes from the same source, for the purposes of the municipal tax only the cadastral value in force on the date of the sale counts.
Óscar's figures, step by step
| Figure | Penthouse in the centre | Flat on the outskirts |
|---|---|---|
| Total cadastral value 2026 | 96,000 € | 88,000 € |
| Cadastral value of the land 2026 | 57,600 € | 22,000 € |
| Land proportion | 60 % | 25 % |
| Purchase price (2015) | 190,000 € | 185,000 € |
| Sale price (2026) | 205,000 € | 200,000 € |
| Gain in price | 15,000 € | 15,000 € |
| Actual increase in the land | 9,000 € | 3,750 € |
The calculation for the penthouse:
- Land at the sale: 205,000 × 0.60 = 123,000 €.
- Land at the purchase: 190,000 × 0.60 = 114,000 €.
- Actual increase: 9,000 €.
And the one for the outskirts: (200,000 − 185,000) × 0.25 = 3,750 €. With the same gain in price, the actual increase for the penthouse is 2.4 times that of the other flat, because the weight of the land is also 2.4 times greater.
That same percentage affects the objective method, which starts directly from the cadastral value of the land: a high cadastral land value raises the objective base and the actual base at the same time. Which method gives less in each case we compare in objective or actual method.
Garages, storerooms and homes with annexes
When a flat is sold with a parking space and a storeroom, there may be a single cadastral reference or several. If there are several, each one has its own cadastral value and its own land proportion, and the price in the deed must be split between them. If the deed gives a single price for everything, it will have to be divided in a reasonable and defensible way, normally in proportion to the cadastral values. A split that concentrates the price in the item with the least land may be checked.
Something similar happens when the price includes furniture. The plusvalía taxes the land, not the furniture, and if the deed separates an amount for furniture with a reasonable inventory, that amount does not enter the comparison. A disproportionate price for the furniture is easy for the council to dispute.
The rule uses the proportion for the year of the sale, not the year of the purchase. If the municipality had a cadastral revaluation whose new values take effect in the same year as the sale, the proportion on the previous year's bill is no use. Before calculating, check that the value you are using is the one in force on the date the tax falls due, because that figure moves the result in direct proportion.
When the bill has no breakdown
Some bills only show the total cadastral value. In that case the certificate from the Cadastre is the most reliable route. If the property is newly built and does not yet have a cadastral value, article 107.2.a) allows the council to assess the tax when the value is set, referring it back to the date of the sale. For the actual method, without a cadastral value there is no proportion, and the calculation has to wait until there is one.
You can send us the cadastral reference, the deeds and the latest bill through the plusvalía form. With those details the proportion can be obtained and the calculation done with both methods.
Challenging the cadastral value is a different procedure
If the cadastral value of the land seems out of proportion to you, the appeal against the plusvalía is not the way to correct it. The cadastral value is set by the Cadastre, which has its own review procedures, and the council takes it as a given. In the plusvalía you can argue that a value was used that was not the one in force on the date, or that the proportion has been calculated wrongly, but not that the Cadastre valued the property wrongly. This distinction avoids appeals that are doomed from the start.
Nor is there any room to replace the cadastral proportion with a valuer’s report saying that the land is worth something else. The law chose an objective rule precisely to avoid that, and applies it both when it favours the taxpayer and when it does not. When the percentage turns out to be high, the best defence is to check that the right year has been used and that it has been applied to both prices.
Other reductions linked to the cadastral value
After a general cadastral revaluation, article 107.3 allows councils to approve a temporary reduction in the value of the land during the first years the new values are in force. In addition, article 107.2.a) authorises the ordenanza fiscal, the council's tax bylaw, to set a reduction coefficient that reflects how up to date the cadastral value is. Both are municipal decisions and affect the objective method: you have to look for them in the municipality's bylaw. Where to find it we explain in what reliefs my council offers.
The guide on the land value on the IBI bill shows where the breakdown appears on the most common bills, and the one on the two methods of calculation uses that proportion in complete examples.
The Salama Tax page on the municipal plusvalía explains the whole tax and the cadastral data needed for each method.