What is the reference value?
· 2 min. read
The reference value is a tax that applies directly to individuals in situations of purchase, inheritance or donation of a property, came into force.
It is a value that is determined annually by the General Direction of Cadastre, based on the prices of property sales and purchases in the same area that are registered in the Property registration. This value is obtained through an analysis of the prices of real estate sales and purchases reported by notaries.
The General Directorate of Cadastre then applies calculation formulae to this data to determine this value. The reference value will not exceed the market value. However, the market value may itself be lower than the reference value, and in this case the reference value would still apply, even if it is higher.
When will the reference value be used?
It will be used as the taxable base for Transfer Tax (Impuesto sobre Transmisiones Patrimoniales, ITP) and Stamp Duty (Actos Jurídicos Documentados, AJD) and Inheritance and Donation Tax (Impuesto sobre Sucesiones y Donaciones, ISD).
In these cases, it will be necessary to declare taking into consideration the higher value: the price paid or, where applicable, the market reference value.
It will also be used in Wealth Tax, as properties acquired after 1 January 2022 will be valued taking into consideration the highest of the following values: the acquisition value, the cadastral value, the reference value or, where applicable, the value verified by the Administration.
How is the reference value calculated?
The reference value is calculated by analysing the purchase prices, depending on the characteristics of each property, and on the basis of the average value modules.
This value will be the minimum tax base for these taxes.
Where can the reference values be consulted?
The reference values can be consulted in the electronic headquarters of the cadastre, being already public from the 1st of January of this year 2022.
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