The Catastro is a secondary system set up within Spain to deal with the ownership, description and boundaries of all property in the country. It is the institution which assesses properties for co-ordinates, cartography, drawings and plans and is the source on which the “Valor Catastral” is calculated. This provides the valuation of the property for the purposes of calculation of taxes due on that property.
Whilst the Registro de la Propiedad and the Escritura may well confirm the ownership of a property and the conditions of that ownership, as in percentages or if there may be limitations or charges (like mortgage, public auctions, tribunal disputes etc.) on the property, the Catastro will give you a better understanding of the boundaries, the exact location of the property (usually in a visual form), size and description of the property, usually with maps, location, and drawings to support this.
But, when you complete the building of a house (or an extension like a new room), or many other constructions such as a pool, garage, shed, etc., then you must not only inform the land registry about the new changes on the property, but also notify the changes to Catastro. Furthermore you must provide plans and drawings to Catastro about these new buildings, or newly extended parts of your property. If you do not do so, you can have future problems because the Catastro will never know about the existence of those new constructions.
There is a general misconception that when the construction of a house, or a further extension of an existing property, is completed that Catastro will automatically register these constructions when passed by a notary. This is not the case. When you complete any of these works you must declare them at the notary, land registry, and the Catastro.
Once the construction is duly registered in the Catastro, you will start to receive bills from the Council based on the newly assessed value of the property. Please be aware the issue of revised bills may take up to 2 years to be so there may be some retrospective taxes to pay.
Catastral records for many properties in Spain are out of date and inaccurate. The Catastral system has been used to formulate the value of properties and therefore to fix the taxable level on each property for many years. However many Spaniards have sought to evade further taxes due by not registering changes to properties, a further reason to have a legal professional acting on your behalf when considering a purchase. Crazy as it may seem this updating of the Catastro was always a voluntary system so anyone who failed to update their property in the Catastro (and therefore saved on the tax due) was doing nothing wrong. Still today you will find Spanish owners very reluctant to update their property in the Catastro and it is very difficult to persuade them otherwise.
But as from 2014 it has become obligatory to notify Catastro of any changes to a property you own; however Catastro has noted that there is a high number of properties that are not updated in the Catastro database. Usually these properties have an under-declared size of building, or parts of the property (like pools, garages, or other areas of the house) have been added and not declared, and as a consequence too little taxes have been paid over the years. As the authorities have the power to go back over a 4 year period to reclaim such taxes it can be a costly mistake not to ensure your property here on the Costa del Sol has been “regularised” in the Catastro.