The municipal capital gains tax — known as Tax on the Increase in Value of Urban Land (IIVTNU)— it is a local tax that taxes the increase in value of the urban land of a property between the moment it is acquired and when it is transferred (either by sale, donation, or inheritance). It is a municipal tax managed by the City Council of Málaga and applies to all owners of urban properties located in the city.
📌 Who must pay the municipal capital gains tax in Málaga?
- Seller of the property: when a property is sold, normally the one transferring the ownership is obliged to settle and pay this tax.
- Heir or donee: in the case of inheritance or donation, the tax falls on the person receiving the property.
- Exceptions: in practice, if there has been no real increase in the value of the land from the purchase to the transfer —for example, because the market value has remained the same or has decreased— the declaration can be submitted and it can be demonstrated to the City Council that there is no gain, thus no tax quota is generated to be paid.
🧮 How is the municipal capital gains tax calculated in Málaga?
The general formula consists of:
- Cadastral value of the land: the value of the urban land assigned to the property is taken (it appears on the IBI receipt).
- Increase coefficient: a percentage that depends on the years that have elapsed between the acquisition and the transfer of the property.
- Municipal tax rate: it is a percentage set by the City Council (which cannot exceed the legal maximum).
Simplified example:
If the cadastral value of the land is €90,000, the coefficients for years of ownership are applied and then multiplied by the tax rate set by the City Council to obtain the final fee.
📌 This method is known as objective method (based on a calculation), the method of which we detail below:
METHOD 1: Objective system
Formula:
Cadastral value of the land × coefficient according to years of ownership
- The maximum computable period: 20 years.
- The maximum coefficients are set by state regulations, but the City Council can approve its own within those limits.
- The municipal tax rate cannot exceed 30%.
📌 Professional recommendation: verify the updated cadastral value (review possible collective valuation procedures).
METHOD 2: Real system
Formula:
(Transfer value – Acquisition value) × land proportion
Where:
Land proportion =
Cadastral value of the land / Total cadastral value
This method is mandatory when the real increase is lower than the result of the objective method if the taxpayer requests it.
⚠️ If the real increase is nonexistent or negative → there is no liability.
📅 Deadlines and formal obligations
- The declaration and payment of the tax must be submitted within the period established by the City Council after the transmission, usually within 30 business days from the date of sale or transmission.
- Although the tax is generally paid by the seller, in purchase contracts it is common to agree in writing who assumes the procedure, always respecting municipal regulations.
🔄 Current changes and bonuses for 2026
The City Council of Málaga continues to apply various bonuses and reductions on the municipal capital gains tax, especially in transmissions by inheritance:
- For inheritances between cohabitants, the bonus can reach a 95% on the tax quota, especially if cohabitation and cadastral value requirements are met.
- For non-cohabitants in transmissions mortis causa, a 37.5% discount in 2026 as part of the municipal tax ordinances, with the aim of moderating local tax pressure.
Currently, municipal ordinances will maintain local taxes frozen, including the capital gains tax, without an update linked to the CPI.
It is also important to know that at the national level there is jurisprudence and regulations that allow not to pay capital gains tax when there is no real increase in the value of the land between the purchase and sale of a property, provided that the corresponding accreditation is provided.
📊 Tax advice for property owners in Málaga
If you are about to sell, inherit, or donate a property in Málaga, consider the following:
- Review the evolution of land value and compare if there is a real increase.
- Request professional advice to assess whether it is advisable to opt for the objective calculation method or the real one.
- Check if you can apply bonuses, especially in the case of inheritance among cohabiting relatives.
- Make sure to submit the declaration and pay within the legal deadline to avoid surcharges or penalties.
Recommended tax strategy before selling in Málaga
- Before signing the deed:
- Calculate municipal capital gains tax.
- Calculate capital gains in IRPF.
- Assess overall impact.
- Review if it is advisable to wait for a specific fiscal year.
- Analyze possible exemptions (over 65 years old, reinvestment in habitual residence, etc.).
- A real estate transaction should be analyzed globally, not tax by tax.
