New Value of Reference for Tax Purposes: “Valor de Referencia”

Since the 1st of January 2022, there is a new and important detail to be aware of about the property that you are wishing to buy, sell, inherit or donate in Spain: the “Valor de Referencia” or “Value of Reference“.

This new value is now the one used by the Tax authorities to calculate the Transfer Tax, the Inheritance Tax and the Donation Tax.

Let’s see how it works with an example: You are buying a property in Spain for a price of 300.000 Euros, but the “Value of Reference” is 500.000 Euros. You will have to pay the transfer tax (curently 7% in Andalucia)  on 500.000 Euros. However, if the “valor de referencia” is lower than the amount you are actually paying, you would still have to pay the tax on the higher amount. Yes, the Tax Office never loses…

Why can this new value differ so significantly from the actual purchase price in some cases? According to the information provided by the Spanish Tax Authorities, this value is calculated using data supplied by Notaries relating to property transactions involving similar types of properties in the same area and it is revised every year. In simple terms, if you purchase one of the cheapest properties in a particularly expensive area, it is quite possible that the “valor de referencia” will be higher than the actual purchase price..

Fortunately, since the new system came into force, we have seen that most of the properties have been assigned a “valor de referencia” lower than the actual sale price. However, we have already detected some cases where the “valor de referencia” is much higher than the actual sale price, for diferent reasons.

An important difference to consider, is that in comparison with the old system, if you declare a value below the “value of reference”, you will not only be requested to pay the right tax, but you will also receive a fine. So, should we face a situation where the “valor de referencia” is higher than the actual price, there are three different courses of action:

1. 1. To challenge the “valor de referencia” as soon as you become aware that it may be incorrect. If your property has already been placed on the market, you may still be in time to have this value corrected before securing a buyer, thereby helping to ensure a smoother sale process. At Bravo Legal, we have successfully handled these challenges and have identified what could be described as a “weak point” in the system. In fact, I was invited to participate in a Seminar held in Madrid on 9th and 10th April 2026, where I explained the method for challenging the “valor de referencia” based on the detection of errors in the “Certificate of Grounds for the Calculation of the Reference Value”. I also presented a real case in which we succeeded in correcting both the reference value and the cadastral value in record time. More information about this clicking here.

   2. To pay the tax on the value that we are actually paying for the property, wait to receive the letter from the Tax Authorities and  challenge the valuation, knowing that if you don’t succeed, you will not only have to pay the tax that they were asking for, but also a fine and interests.

   3. To pay the tax on the “valor de referencia” and immediately challenge the valuation asking for a refund of the excess paid. In general, we would advise to take this route.

The decision of how to approach this situation will depend on each case, and it would always help to obtain a valuation from a qualified professional, as depending on this information, you can decide whether it is wiser to accept that you are buying below the market value, and in that case, pay based on the “valor de referencia”…, or if it is more beneficial to do the opposite. In some cases, it may even be better to choose another property, avoiding the whole problem at the outset, but by being aware of this, it will help you to make an informed decision when the time comes.

Here, at Bravo Legal, we are specialists in property conveyance and in the “Value of Reference” , and we can take care of every aspect of your purchase or sale. If you would like to receive a no-obligation quotation for our services in relation to the sale or purchase of a property in Spain, please fill out the following form, providing us with some information about the purchase or sale you are planning (price, conditions, location of the property, resident/non-resident etc.) and we will get back to you immediately. If you include the Referencia Catastral, we will provide you with the “Valor de Referencia” for your property without any cost (only for properties within the Malaga province).