Mallorca · Ibiza · Menorca · Formentera
A practical guide to purchase taxes and ongoing obligations for international buyers acquiring property in Mallorca, Ibiza, Menorca or Formentera.
Mallorca, Ibiza, Menorca and Formentera follow the Balearic tax framework. The main variables are whether the property is a resale or a first transfer from a developer, the taxable value, the buyer’s circumstances and the intended use.
A resale purchase is generally subject to Impuesto sobre Transmisiones Patrimoniales. The Balearic Islands apply a progressive scale, meaning portions of the taxable base may fall into different bands. At the date of this draft, the standard scale runs from 8% at the lower band to 13% for the highest-value portion.
| Taxable portion | Standard ITP rate |
|---|---|
| Up to €400,000 | 8% |
| €400,000.01–€600,000 | 9% |
| €600,000.01–€1,000,000 | 10% |
| €1,000,000.01–€2,000,000 | 12% |
| Above €2,000,000 | 13% |
The applicable taxable base may be affected by the official property reference value. A price agreed below that figure does not necessarily mean tax is calculated only on the lower price. Your lawyer or tax adviser should check the reference value and current rules before you commit.
A qualifying first transfer from a developer is generally subject to VAT rather than ITP. Residential property is commonly charged at 10% VAT, together with Balearic Stamp Duty (Actos Jurídicos Documentados) at the applicable current rate. Different treatment can apply to land, commercial property, garages sold separately and other transactions.
The Balearic framework includes reduced rates or reliefs for certain purchases, but qualification can depend on factors such as value limits, habitual-residence use, age, disability, family status, income and prior ownership. These conditions should be verified against the law in force on the completion date. Do not price a transaction on the assumption that a reduced rate will apply.
A municipal property tax based on the cadastral value and local rate. Confirm outstanding amounts and the payment arrangement during due diligence.
Non-resident owners may have a Spanish filing obligation even when the property is not rented. Rental use creates separate income and expense considerations.
Depending on residence, ownership, value, allowances and current national and regional rules, wealth-related filings may require specialist advice.
Municipalities may levy refuse-collection or other local charges in addition to IBI.
A buyer should calculate the applicable tax on the actual property and add professional and registration costs. A single “allow 10%” rule can be inadequate for higher-value Balearic purchases or for properties requiring technical, planning or finance work.
Although capital gains tax and municipal plusvalía normally concern the seller, the buyer’s lawyer must manage completion mechanics carefully. When the seller is non-resident, a statutory retention from the price may apply and must be paid to the Spanish tax authority within the required procedure and deadline.
The standard Balearic scale is progressive, so the calculation should be performed by bands. Transaction details and the correct taxable base must be confirmed.
The principal purchase-tax framework is based mainly on the transaction and applicable relief conditions, not simply nationality. Residence and personal circumstances can affect other taxes and eligibility.
Do not assume so. The licence, property eligibility, ownership change and local or regional restrictions require specific verification before purchase.
The buyer is responsible, normally with the filing coordinated by the appointed lawyer or tax representative after completion.
Connect with an English-speaking Spanish property lawyer who understands international transactions and the local market where you plan to buy.