Update: 24 September 2025
Insurance Premium Tax (IPT) regulations in Spain are among the most intricate within the European Union.
Compliance is particularly challenging due to the involvement of multiple tax authorities. These include the central tax administration – commonly referred to as “HACIENDA/AEAT” (Agencia Estatal de Administración Tributaria) – as well as four provincial tax offices in the Basque Country: Álava, Guipúzkoa, Navarra, and Bizkaia.
In addition to IPT, insurers are also subject to extraordinary surcharges on some of the risks. These surcharges must be paid to the Consorcio de Compensación de Seguros (Consorcio). Furthermore, fire brigade contributions are due either to GESTORA (Gestora de Conciertos para la Contribución a los Servicios de Extinción de Incendios) if the insurance company is a member of GESTORA, or to over 300 municipalities without membership. Municipal FBC (MFBC) may also be payable to certain municipalities within the Madrid region.
Given this complex landscape, navigating Spain’s IPT framework and maintaining compliance can be particularly demanding. To support insurers in this effort, SOVOS has developed this guide to address key questions and provide clarity on the nuances of Insurance Premium Taxation in Spain.
The Spanish Insurance Premium Tax (IPT) landscape
While not all taxes apply to every insurance risk, the applicable obligations vary based on the nature of the coverage. Navigating Spain’s Insurance Premium Tax (IPT) framework requires a solid understanding of more than five distinct taxes and contributions.
Below are the most encountered taxes and surcharges in Spain:
- Insurance Premium Tax (IPT)
- Additional surcharges:
- CCS surcharges: MOD10, MOD11, MOD20, MOD50
- Fire Brigade Charges: FBC and MFBC (municipal FBC)
- Carta Verde (Green Card)
- Environmental Damage Compensation Fund Contribution (ENV)
Basics for Insurance Premium Tax (IPT)
Where should IPT be filed?
Insurance Premium Tax (IPT) in Spain must be paid to one of five different tax authorities, depending on the postcode of the insured risk location. While most liabilities are reported to the central tax administration, known as “Hacienda” (Agencia Estatal de Administración Tributaria), some Basque regions have their own tax offices.
The first two digits of the five-digit Spanish postcode determine the appropriate tax authority for IPT reporting. If the postcode begins with one of the designated codes for the Basque provinces, as listed below, IPT must be paid to the corresponding regional tax office. For all other postcodes, IPT is payable to the central tax administration.
- Navarra – 31
- Álava – 01
- Guipúzcoa – 20
- Vizcaya – 48
In addition to registering with the central tax administration (Hacienda), insurers must register with the relevant provincial tax office corresponding to the location of the insured risk, where applicable.
What is the IPT rate in Spain?
The current IPT rate in Spain is 8% as of 2021, and it is applied to all classes of insurance, with some exemptions.
Are there IPT exemptions in Spain?
Certain classes of insurance businesses are exempt from Insurance Premium Tax (IPT) in Spain. These exemptions typically include life, health, reinsurance, export credit, suretyship, and international coverage across various sectors such as marine and aviation. Agricultural risks may also qualify for exemption, depending on the specific circumstances.
What is the basis of Spain’s IPT calculation?
The basis for calculating Insurance Premium Tax (IPT) in Spain is the total premium amount payable by the insured. Depending on how the Fire Brigade Charge (FBC /MFBC) is levied, it may also be included in the taxable base for IPT purposes.
Who is liable for IPT in Spain?
The insurer is responsible for calculating, collecting and remitting the Insurance Premium Tax (IPT) to the appropriate tax authority, in accordance with the filing and submission requirements established by each respective office.
How to file IPT in Spain?
Although Insurance Premium Tax (IPT) is classified as an indirect tax, insurance companies are not currently required to submit real-time transactional data through Spain’s Immediate Supply of Information (SSI) system, which is already in use for VAT reporting. However, future developments are expected to move IPT submissions toward greater automation, aligning more closely with VAT processes. At present, IPT reporting involves both monthly and annual declarations:
- Monthly Declaration – Modelo 430
- Central Administration (Hacienda) and Navarra: Due by the 20th of the month following the reporting period
- Álava, Guipúzcoa, and Vizcaya: Due by the 25th of the month following the reporting period
- Annual Declaration – Modelo 480 Due by end of January of the year following the reporting period
IPT filings in Spain are submitted online and may require varying levels of detail, such as a breakdown by covered risks.
Basics for Other Taxes
CCS or Modellos
CCS or Modelos are administered by Consorcio de Compensación de Seguros (Consorcio). One of the Consorcio’s primary responsibilities is to compensate policyholders when the Spanish government officially declares an extraordinary risk event.
Extraordinary risks generally fall into the following categories:
- Natural disasters, such as floods or earthquakes
- Violent acts, including terrorism, civil unrest, and similar events
- Actions by armed forces or law enforcement during peacetime
Each Modelo is subject to its own tax rate and calculation methodology. Below is a high-level summary:
- MOD10 and MOD11: The calculation for Modelo 10 is relatively complex. The applicable rate depends on several factors, including the type of risk covered, policy duration, taxable base, and indemnity limits. The sum insured typically serves as the basis for calculation.
- MOD20 (NGF): A rate of 1.5% applies to the taxable premium for compulsory coverage. If the coverage is not mandatory, NFG is not due.
- MOD50 (CLEA): A flat rate of 0.15% applies to the taxable premium across all classes of business, with limited exemptions.
Returns must be submitted on a monthly basis via a dedicated online portal that requires detailed policy-level information. Payment is made through direct debit, which is automatically triggered upon submission of the return.
Fire Brigade Charges (FBC and MFBC)
The Fire Brigade Charge (FBC) is a surcharge applied to insurance premiums that include fire coverage. Depending on the nature of the policy, the tax may be levied on the full premium or only on the portion attributable to fire risk.
Provided that the insurance company is a member of Gestora de Conciertos para la Contribución a los Servicios de Extinción de Incendios (GESTORA), the collection of FBC is centralized by this body. This body operates under the umbrella of UNESPA—the Spanish Association of Insurers and Reinsurers—and represents over 96% of insurance companies in Spain.
However, in the absence of membership, the insurance company should deal with 300+ municipalities in Spain because FBC amounts must be paid individually to the respective municipalities based on the postcode of the insured risks. Therefore, it is strongly recommended to become a member of GESTORA, as this significantly reduces the administrative burden associated with FBC payments.
Two standard rates apply:
- 5% for standalone fire policies
- 5% (i.e., 5% applied to 50% of the premium) for multi-risk policies that include fire coverage
Joining GESTORA is administratively challenging, as new members are accepted only once per year. Insurers must submit a formal application during a limited registration window – typically one month in the spring.
FBC settlement spans five years and consists of four phases:
- Prepayment: Based on an annual report of property and fire policies written in the previous year, insurers make a prepayment at the beginning of the following year.
- Annual Declaration: In the second year, insurers submit actual premium data for the prior year.
- Adjustment: In the fourth year, the difference between the prepayment and actual premiums is reconciled.
- Final Adjustment: In the fifth year, any remaining discrepancies are corrected.
In addition to the National FBC, insurance companies may be subject to a Municipal Fire Brigade Charge (MFBC) if the insured risks are located in the Region of Madrid, because some Madrid Councils have implemented a municipal levy (MFBC). MFBC rates vary by municipality and coverage type, ranging from 5% to 30%, and may be structured as either fixed or variable. The declaration period is typically annual.
Additional Spain IPT resources
- Watch our webinar, IPT: Spotlight on Spain, for a deep dive into Spain’s CCS
- Learn how to navigate the complex region with our ebook: Is IPT simplicity in Spain possible?
- Read our free guide to Insurance Premium Tax to learn more
- How to avoid errors in Fire Brigade Charge reporting in Spain
Need more information? Our team of tax experts are ready to help. Get in touch today.
