Practical travel information on Money and costs in Madrid

Money & costs

Contents

Costs
Money

Costs

First, the bad news. Not so long ago, Madrid was the second-cheapest capital city in Europe. But soaring house prices and a significant rise in prices across the board since Spain adopted the euro in 2002 have made Madrid not only the most expensive city in Spain, but the 22nd most expensive city in the world in which to live.

Despite such a gloomy outlook Madrid remains generally cheaper for travellers than many major world capitals. If you’re coming from Paris, London or New York, you may find most things cheaper than back home. Unlike elsewhere in cities of Madrid’s stature, it’s also still possible to find semi-luxurious boutique hotels for around €100 a double in the city centre. At the budget end of the market, dormitory beds shouldn’t cost more than €20 and nice hostales (hostels) with private bathroom and TV rarely cost more than €60, sometimes even less. Eating out in a nice, midrange restaurant shouldn’t cost much more than about €30 per person, although you can do it for a lot less, especially if you partake in the weekday lunchtime menú del día, a fixed-price, three-course set lunch that costs around €10. The menú del día is a great way to experience a more expensive restaurant without getting stung for à la carte prices. Transport (metro, city buses and even taxis) is still absurdly cheap and, if you time your visit well, it’s possible to visit some museums at no cost, including the must-see Museo del Prado and the Centro de Arte Reina Sofía.

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Money

As in most other EU nations, Spain uses the euro, which replaced the peseta in 2002. Although it’s becoming rarer, you occasionally see prices listed in pesetas alongside the euro price; this is especially common with house prices.

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Changing money

You can change cash or travellers cheques in currencies of the developed world without problems at virtually any bank or bureau de change (usually indicated by the word cambio). Central Madrid also abounds with banks – most have ATMs.

Exchange offices are open for longer hours than banks but generally offer poorer rates. Also, keep a sharp eye open for commissions at bureaus de change.

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Credit cards

Major cards, such as Visa, MasterCard, Maestro, Cirrus and, to a lesser extent, Amex, are accepted throughout Spain. They can be used in many hotels, restaurants and shops; in doing so you’ll need to show some form of photo ID (eg passport). Credit cards can also be used in ATMs displaying the appropriate sign (if there’s no sign, don’t risk it), or, if you have no PIN, you can obtain cash advances over the counter in many banks. Check charges with your bank.

If your card is lost, stolen or swallowed by an ATM, you can call the following numbers toll-free to have an immediate stop put on its use:

Amex (902 375 637)

Diners Club (91 211 43 00, 902 40 11 12)

MasterCard (900 971 231)

Visa (902 192 100)

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Travellers cheques

Does anyone still use travellers cheques? If you do, most banks and exchange offices will cash travellers cheques; get most of your cheques in fairly large denominations to save on per-cheque commission charges. It’s vital to keep your initial receipt and a record of your cheque numbers and the ones you have used, separate from the cheques themselves. It can also be a good idea to keep handy the number for reporting lost or stolen cheques, even though, best case scenario, you won’t need to use it.

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Taxes & refunds

Value-added tax (VAT) is known as impuesto sobre el valor añadido (IVA; EE-ba). On accommodation and restaurant prices, IVA is 7% and is usually – but not always – included in quoted prices. On retail goods IVA is 16%.

Visitors are entitled to a refund of the 16% IVA on purchases costing more than €90.16, from any shop, if the goods are taken out of the European Union (EU) within three months. Ask the shop for a cashback refund form showing the price and IVA paid for each item, and identifying the vendor and purchaser; then present the form at the customs booth for IVA refunds when you depart from Spain (or elsewhere from the EU). At this point, you’ll need your passport and a boarding card that shows you’re leaving the EU. The officer will stamp the invoice and you hand it in at a bank at the departure point for the reimbursement. There are refund offices in terminals T1, T2 and T4 at Barajas airport as you’re departing from Madrid.