Who Pays Community Fees and IBI in Spanish Rentals?

🇪🇸 Read the original in Spanish

The rental market in Spain constantly raises questions for both landlords and tenants, with the distribution of property expenses being one of the main sources of conflict. When a lease agreement is signed, a major question immediately arises: who is responsible for paying the gastos de comunidad (community of owners' fees) and the Impuesto sobre Bienes Inmuebles (IBI, the municipal property tax)? Spanish legislation is clear on this matter, but it demands compliance with very strict formal requirements for agreements between both parties to be legally valid. In this article, we analyse the regulatory framework, validity requirements, the most common mistakes, and everything you need to know to avoid financial surprises or court disputes.

The Legal Framework: What Does the Law Say About IBI and Community Fees?

To resolve this issue, we must look to the cornerstone of rental legislation in Spain: Ley 29/1994, de 24 de noviembre, de Arrendamientos Urbanos (LAU) (the Urban Leasing Act). It is this law that determines the playing field and the limits of what can and cannot be agreed upon.

The General Principle: Article 20 of the LAU

The key provision is Article 20.1 of the LAU. This legal rule establishes that the parties (landlord and tenant) can agree that the expenses for the general maintenance of the property, its services, taxes, and charges that cannot be individualised (meaning they are not measured by an individual meter) shall be borne by the arrendatario (tenant).

What does this mean in practice?

• By default (if the contract is silent): The party obligated to pay these expenses is the landlord. The IBI is a tax levied on property ownership, and community fees correspond to the maintenance of the building in which the landlord is a co-owner.
• By express agreement: The law allows the landlord to transfer these costs to the tenant, but for this transfer to be valid before the courts, extremely rigorous formal requirements must be met, which we will analyse below.

The Civil Code and the Tax Agency: Who is the Taxpayer?

It is essential to understand a key legal distinction: the difference between the contractual relationship (landlord-tenant) and the relationship with the Public Administration or the Comunidad de Propietarios (Community of Owners).

• Vis-à-vis the Town Hall (IBI): The sujeto pasivo (taxpayer/liable party) of the tax is always the landlord. If the tenant fails to pay the IBI despite having agreed to do so in the contract, the Town Hall will seize the landlord's assets, never the tenant's. The landlord will have to pay the Town Hall and then judicially claim that money back from the tenant for breach of contract.
• Vis-à-vis the Community of Owners: The party obligated to pay the monthly fees is the landlord. The community cannot sue the tenant for non-payment of common expenses; the lawsuit will always be directed against the property owner.
• The Civil Code: In its Article 1255, it enshrines the principle of autonomy of will (freedom of contract), provided that agreements are not contrary to the law, morals, or public order. Article 20 of the LAU acts as the legal limit to that freedom of contract within the scope of urban leases.

The Housing Law (Ley 12/2023): What Has Changed?

The recent Ley 12/2023, de 24 de mayo, por el derecho a la vivienda (Housing Law) has introduced important modifications to the LAU, especially regarding real estate agency fees and contract formalisation costs, which are now always borne by the landlord (Article 20.1, second paragraph).

However, regarding the IBI and community fees, the Housing Law has not prohibited agreeing that they be paid by the tenant. It remains legal to pass them on, provided this is done in compliance with the formal requirements of Article 20.1 of the LAU.

Mandatory Requirements for the Tenant to Pay IBI or Community Fees

If you are a landlord and you want the tenant to assume the cost of the IBI and community fees, it is not enough to include a generic clause stating "the tenant will pay all property expenses". If you do this, the clause will be null and void (nula de pleno derecho), and the tenant will have no obligation to pay a single euro for these concepts.

For the agreement to be fully valid and enforceable, the contract must strictly comply with these two requirements:

1. Express agreement in writing: It must be clearly stated in the wording of the lease agreement.
2. Determination of the annual cost at the date of the contract: The contract must specify the exact annual amount of these expenses at the time of signing.

This second requirement is the one most frequently breached in practice. The law requires the tenant to know exactly how much the annual financial commitment they are assuming amounts to. If payment of the IBI is agreed, the amount of the latest tax bill must appear. If community fees are agreed, the monthly fee or its annual calculation must be stated.

Practical Step-by-Step Steps to Pass on Expenses

If you are a landlord and wish to legally pass on the IBI and community fees to your tenant, you must follow this procedure to prevent the tenant from challenging the payments or a judge declaring the clause void in the event of a dispute:

Step 1: Meticulous drafting of the clause in the contract

You must include a specific clause in the rental contract. An example of correct drafting would be: > "In accordance with Article 20 of the Ley de Arrendamientos Urbanos, the parties expressly agree that the general expenses for the adequate maintenance of the property, its services, taxes, and charges that are not susceptible to individualisation shall be borne by the tenant. At the date of signing this contract, these expenses are determined in the following amounts: > a) The Impuesto sobre Bienes Inmuebles (IBI), which amounts to €350.00 annually, according to the latest bill issued by the Town Hall. > b) The ordinary common expenses of the Comunidad de Propietarios, which amount to €60.00 monthly (a total of €720.00 annually)."

Step 2: Proof of real amounts

At the time of signing the contract, it is highly recommended to attach as annexes a copy of the last paid IBI bill and a certificate from the administrador de fincas (property manager) or the latest community of owners' receipt to verify that the amount indicated in the contract is real.

Step 3: Monthly or annual collection and issuing invoices/receipts

The landlord cannot simply issue a global receipt. Monthly, when collecting the rent, they must break down the concepts clearly:

• The rental price: For example, €800.00.
• The community fees: For example, €60.00.
• The proportional part of the IBI (if split payment is agreed): For example, €29.16 (the result of dividing €350.00 by 12 months).

The tenant has the right to receive a receipt or invoice where each of these concepts is perfectly itemised.

Step 4: Documentary justification of payment

To demand reimbursement of these expenses, the landlord must present the tenant with documents proving that they have previously paid these amounts (the bank receipt of the IBI charge from the Town Hall or the charge from the Community of Owners). The tenant is not obliged to pay concepts that the landlord does not prove to have previously settled.

Practical Examples with Real Figures

To better understand how this financial and legal mechanism works, we will analyse two very common scenarios in the Spanish real estate market.

Example 1: Contract with a valid expense transfer agreement

• Tenant: María.
• Landlord: Juan.
• Agreed monthly rent: €900.00.
• Agreement in contract: It is agreed in writing that María will pay the IBI (€400.00 per year) and the ordinary community fees (€50.00 per month / €600.00 per year). Both amounts are explicitly stated in the contract.

How is the payment made? Juan decides to charge María a single monthly receipt. The breakdown is as follows:

• Rent: €900.00
• Community: €50.00
• IBI (pro-rated): €33.33 (result of €400.00 / 12 months)
• Total monthly amount to be paid by María: €983.33

This agreement is 100% legal and enforceable. If María stops paying the €83.33 corresponding to the expenses, Juan can initiate an eviction process for non-payment of amounts assimilated to rent (Article 27.2.a of the LAU in relation to the Ley de Enjuiciamiento Civil / Civil Procedure Act).

Example 2: Contract with a clause void due to defects in form

• Tenant: Carlos.
• Landlord: Pedro.
• Agreed monthly rent: €1,000.00.
• Agreement in contract: In the fifth clause, it is written: "The tenant will take charge of all community of owners' expenses and the IBI tax corresponding to the property during the term of the contract". No figure or annual amount is specified.

After six months, Pedro demands that Carlos pay €600.00 for the annual IBI bill and €480.00 for accumulated community fees.

What happens legally here? Carlos refuses to pay and has the law on his side. Since the amount of the expenses was not determined at the time of signing the contract (a mandatory requirement of Article 20.1 of the LAU), the clause is considered null and void. Pedro will have to assume the payment of the €1,080.00 out of his own pocket and will not be able to evict Carlos for this reason.

Limits and Updates: The Cap on Expense Increases

The law protects the tenant against uncontrolled increases in community expenses that the landlord decides to pass on.

According to Article 20.2 of the LAU, during the first 5 years of the contract's term (or 7 years if the landlord is a legal entity/company), the amount the tenant pays for these community expenses can only be increased annually by agreement of the parties, and up to a maximum limit.

This maximum limit for the annual increase of community expenses cannot exceed the percentage by which the rent is increased (which is currently decoupled from the IPC/CPI and is governed by the Price Reference Index regulated by the Housing Law, limited to a 3% maximum increase for the year 2024).

> Exception: This increase limit does not apply to variations in taxes (such as the IBI), which will rise or fall according to what the corresponding Town Hall officially determines.

Mistakes You Must Avoid

Making mistakes in the management and drafting of the distribution of expenses can lead to serious economic and legal consequences. Always avoid the following:

• Including generic or imprecise clauses: Drafting phrases like "the tenant will pay the expenses corresponding to the property" without detailing the exact figures in euros. This completely invalidates the transfer of expenses.
• Attempting to pass on extraordinary community levies: Extraordinary levies (derramas) for building improvements (such as installing an elevator, renovating the facade, or repairing the roof) are always borne by the landlord. The law only allows passing on ordinary maintenance expenses and common services (cleaning, hallway lighting, entrance maintenance).
• Not demanding proof of payment: If you are a tenant, never pay the IBI or community fees without the landlord showing you the official receipt of having paid it beforehand. You have a legal right to demand such documentary proof.
• Claiming judicially without a contractual basis: If you are a landlord, do not attempt to sue a tenant for non-payment of IBI if you do not have a copy of the contract where the requirements of Article 20.1 of the LAU are scrupulously met, as you will lose the lawsuit and could be ordered to pay court costs.

Frequently Asked Questions (FAQ)

Can the landlord force me to pay the IBI if nothing was signed in the contract?

No, absolutely not. If the lease agreement does not expressly mention that the tenant must assume the payment of the IBI, the law determines that this tax corresponds exclusively to the property owner. Any subsequent attempt to collect it without it being signed in the contract is illegal.

What about the rubbish collection fee? Who pays it?

The rubbish collection fee (tasa de basuras) is a service that directly benefits the person living in the property and generating the waste. Therefore, unless the contract says otherwise, the rubbish fee corresponds to the tenant if it is individualised. Nevertheless, to avoid conflicts, the ideal approach is for it to be perfectly regulated in the clauses of the rental contract.

If the community of owners increases the monthly fee, must the tenant pay it?

Yes, but within legal limits. If it has been validly agreed that the tenant pays the community fees, they must assume the increase in actual ordinary expenses. However, during the first 5 years of the contract (or 7 years if the landlord is a company), the annual increase that can be applied to the tenant for this concept cannot exceed the rent update percentage (limited to 3% in 2024).

Can a tenant be evicted for not paying the IBI or community fees if their payment was agreed?

Yes. The jurisprudence of the Supreme Court equates the non-payment of assimilated amounts (such as validly agreed IBI or community fees) to the non-payment of the monthly rent itself. Therefore, the landlord can initiate an eviction procedure for non-payment and termination of the lease agreement under Article 27.2.a of the LAU.

In Summary

• By default, the landlord pays: If the rental contract does not specify anything, the IBI and community expenses are the exclusive responsibility of the landlord.
• The agreement is legal: It can be agreed that the tenant pays these expenses, but it must be written in the contract.
• The exact figure is mandatory: For the clause to be valid, the contract must state the exact annual amount of the IBI and community fees at the date of signing.
• Ordinary expenses only: The tenant must never pay extraordinary community levies (such as facades or elevators); these always correspond to the landlord.
• Consequences of non-payment: If the tenant accepts the payment by contract and then fails to comply, they face an eviction lawsuit for non-payment of assimilated amounts.

General legal information, not personalised legal advice. For your specific situation, ask your question for free at AbogadoAI — answers grounded in Spanish law (BOE), in English.

This is general information, not legal advice. Verify on the BOE or consult a lawyer for your specific case.