IAE – Tax on Business Activities

What is IAE?

IAE is levied on entrepreneurial, professional or artistic activities within the national borders.

Who must pay this tax?

IAE must be paid yearly by individuals and legal entities who carry out entrepreneurial, professional or artistic activities and who are not included in any exemption established in article 82 of the Texto Refundido de la Ley Reguladora de las Haciendas locales (Revised Text of the Regulatory Law of Local Revenue Agencies).

When must it be paid?

Each local council sets due dates in its tax byelaws. After the deadline for payment, the tax will be enforced, with corresponding surcharges and interest for late payment.

Where and how must it be paid?

At the collaborating entities listed on the official payment form using one of the following methods of payment:

  • In person, at branch offices of the financial institutions.
  • ATM, if the collaborating entity offers this service.
  • Phone banking, if the collaborating entity offers this service.
  • Internet, by bank transfer or using a debit or credit card.

The official payment form sent by BASE via surface mail, is needed to complete the transaction. If you do not receive this form you can request a copy from any of the BASE offices.

Sample official payment form (pdf)

Notice: Payment must be made within the period stipulated on the official payment form. After this period you can request a new document, depending on the status of your tax file.

Regulation of IAE

The IAE is regulated by:

  • The Texto Refundido de la Ley Reguladora de las Haciendas Locales(Revised text of the Regulatory Law of Local Revenue Agencies), approved in the Royal Legislative Decree 2/2004, of 5 March (articles 78 to 91, 134, additional administrative orders 10 and 12, temporary administrative orders 4, 13 and 17, single final administrative order);
  • Law 51/2002, of 27 December, on the reform of Regulatory Law 39/1988, of 28 December, on Local Revenue Agencies (additional administrative orders 3, 4 and 10);
  • The Royal Legislative Decree 1175/1990, of 28 September, approving taxation rates and local procedure formalities;
  • The Royal Legislative Decree 1259/1991, of 2 August, approving taxation rates and local procedure formalities corresponding to independent cattle farming activities;
  • Local council tax byelaws, in which location coefficients and applicable relief is set (within the limits established by law) and concrete matters and formalities for management and collection are determined.
  • The Royal Decree 243/1995, of 17 February, giving the norms for management of Business Tax and regulating the delegation of responsibilities for management of tax registers;
  • The Royal Decree 1065/2007, of 27 July, approving the General Regulations on procedures and tax management and inspection, and on the development of common norms for taxation procedures;
  • Administrative Order HAC/85/2003, of 23 January, determining the circumstances under which accountable persons are required to notify net turnover and approving the official form for notification;
  • Administrative Order HAC/2572/2003, of 10 September, approving the official tax form 840, and setting the general conditions and procedures for filing online