Taxes for Non-Residents Buying Property in Mallorca: The Complete 2026 Guide

Buying a home in Mallorca is one of the most rewarding decisions an international buyer can make, but it comes with a tax framework that catches many people by surprise. From the moment you sign the deed to every year you own the property, and again when you sell, the Spanish and Balearic tax authorities play a part.

This guide explains every tax a non-resident faces when buying, owning and selling property in Mallorca, with the rates and rules in force for 2026. It is written specifically for foreign buyers searching for property for sale in Mallorca who want to budget accurately and avoid costly mistakes.

Who Counts as a Non-Resident in Spain?

You are considered a non-resident for Spanish tax purposes if you spend fewer than 183 days a year in Spain and your main personal and economic interests, your centre of life, remain in another country.

Most international buyers in Mallorca are non-residents. They use the property as a holiday home or second home, spend part of the year on the island and pay their main taxes elsewhere. Your nationality does not change this. What matters is where you are tax resident.

The taxes in this guide apply to you as a non-resident owner. They are separate from, and in addition to, any tax you pay in your home country, although double taxation treaties usually prevent you from being taxed twice on the same income.

Taxes When Buying Property in Mallorca

The first set of taxes arrives at the point of purchase. Which one you pay depends on a single question: is the property a resale or a brand-new build?

Transfer Tax (ITP) on Resale Properties

If you buy a second-hand property, the main purchase tax is the Property Transfer Tax (Impuesto sobre Transmisiones Patrimoniales, or ITP). The Balearic Islands apply one of the most progressive ITP scales in Spain, charged in bands so that higher-value homes pay more on the upper portion of the price.

For 2026 the Balearic ITP bands are:

Up to 400,000 € — 8%
400,000 € to 600,000 € — 9%
600,000 € to 1,000,000 € — 10%
1,000,000 € to 2,000,000 € — 12%
Above 2,000,000 € — 13%

The tax is calculated band by band, not as a single flat rate on the whole price. A common mistake is to apply the top percentage to the entire amount.

Worked example for a resale home of 800,000 €:

The first 400,000 € at 8% = 32,000 €
The next 200,000 € (400,000 to 600,000) at 9% = 18,000 €
The next 200,000 € (600,000 to 800,000) at 10% = 20,000 €
Total ITP = 70,000 €

ITP is paid by the buyer and must be settled within 30 working days of signing the deed, using Modelo 600. The taxable base is the higher of the price you pay or the official reference value (valor de referencia) set by the cadastre, so it is essential to check that figure before agreeing a price.

VAT and Stamp Duty on New-Build Properties

If you buy a newly built home directly from a developer, ITP does not apply. Instead you pay two taxes:

VAT (IVA) at 10% of the purchase price
Stamp Duty (AJD) at 1.5% in the Balearic Islands

VAT and ITP are mutually exclusive, so you never pay both on the same home. Stamp duty on the mortgage deed itself is paid by the lender, not the buyer.

Other Purchase Costs to Budget For

Beyond the tax, allow roughly 1% to 2% of the price for the costs that complete a purchase:

- Notary fees for executing the deed
- Land Registry fees to register the property in your name
- Gestoría fees for handling the paperwork with the registry and banks
- Legal fees for an independent lawyer, usually around 1% to 1.5%

As a general rule, a non-resident buying a resale home in Mallorca should budget around 10% to 12% on top of the price, rising towards 13% to 14% in the luxury segment. For a new build, budget around 11.5% to 12%.

Taxes When Owning Property in Mallorca

Once you own the property, three annual taxes can apply. Crucially, these are separate obligations paid to different authorities, and paying one does not settle another.

IBI: The Annual Council Tax

IBI (Impuesto sobre Bienes Inmuebles) is the local property tax, levied every year by the municipality where your home sits. It is based on the cadastral value and ranges between 0.4% and 1.1% depending on the town hall.

In Mallorca there is an extra layer to be aware of: alongside the municipal refuse charge, the island council (Consell Insular) applies a waste-incineration fee that is added to the rubbish tax. Your IBI receipt also shows the cadastral value, which you will need for your income tax return, so keep it safe each year.

Non-Resident Income Tax on a Home You Use Yourself

This is the tax that surprises most foreign owners. Even if you never rent your Mallorca home and only use it for holidays, Spain assumes the property generates a notional income, known as imputed income (renta imputada), and taxes you on it through the Non-Resident Income Tax (IRNR) on Modelo 210.

The calculation is:

A taxable base of 1.1% of the cadastral value if that value has been revised in the last ten years, otherwise 2%
A tax rate of 19% for residents of the EU, Norway, Iceland and Liechtenstein, or 24% for all other non-residents, including the UK since Brexit

Worked example with a cadastral value of 380,000 €:

1.1% of 380,000 € = 4,180 € base
At 19% (EU resident) = 794.20 € per year
At 24% (non-EU resident) = 1,003.20 € per year

The amount is usually modest, but the return is compulsory and is filed once a year, by 31 December of the year following the tax year. Where a property has two owners, for example a couple owning 50% each, each owner files their own return for their share.

Non-Resident Income Tax on Rental Income

If you let your property, the actual rental income must be declared on Modelo 210. Since the 2024 tax year this is filed annually, between 1 and 20 January of the following year, replacing the old quarterly system.

EU and EEA residents are taxed at 19% on the net income and may deduct costs directly linked to the rental, such as mortgage interest, community fees, IBI, insurance, maintenance, utilities and depreciation of around 3% per year on the building value. Non-EU residents have historically been taxed at 24% on the gross income with no deductions, although a 2025 ruling by the Spanish National Court has begun extending deduction rights to non-EU owners. This area is evolving, so confirm your position with an adviser.

If you let the property for only part of the year, you must file both a rental return for the let period and an imputed income return for the remaining days.

Wealth Tax and the Solidarity Tax

Higher-value owners may face Wealth Tax (Impuesto sobre el Patrimonio), which applies to the net value of your Spanish assets above a personal allowance of 700,000 € per owner. This is where Mallorca differs from regions such as Madrid: the Balearic Islands do not fully eliminate wealth tax, so significant estates here can genuinely pay it.

Because the allowance is per person, a couple owning a home jointly each benefit from their own 700,000 € exemption. Above this, progressive rates apply.

On top of this sits the national Solidarity Tax on Large Fortunes, which targets net wealth above 3 million euros and acts as a floor that regional reliefs cannot reduce. Any wealth tax already paid is credited against it. For luxury purchases this planning matters, so take advice before you buy.

Taxes When Selling Property in Mallorca

Selling a Mallorca property as a non-resident brings its own taxes, and one rule in particular catches sellers off guard.

Capital Gains Tax and the 3% Retention

The profit on a sale, the difference between your purchase costs (price, taxes, notary, registry, value-adding renovations) and the sale proceeds, is taxed at 19% for non-residents. Unlike some countries, Spain has no taper for long ownership: the gain is taxed at the same rate whether you owned the home for five years or twenty.

To secure this tax, the buyer is legally required to withhold 3% of the sale price and pay it directly to the tax office as an advance on your gain. You then file a Modelo 210 within four months of the sale to settle the final liability, or to reclaim the difference if the 3% was more than the tax actually due.

Plusvalía Municipal

In addition, the seller pays a local tax to the town hall, the plusvalía municipal, on the increase in the value of the land (not the building) during your ownership. It is self-assessed and payable within 30 days of the sale.

Inheritance and Gift Tax: The Balearic Advantage

For families, the Balearic Islands have become one of the most favourable regions in Spain, and this is a major update that older guides miss.

Since July 2023, inheritances between close family (Group I and Group II: children, grandchildren, parents, grandparents and spouses) benefit from a 100% bonus on the tax, with no upper value limit. In practice, a Mallorca property passing from parent to child is inherited with effectively zero inheritance tax.

Critically, this relief has been confirmed as available to non-residents as well. A foreign owner whose heirs live abroad can apply the Balearic bonus, with the return (Modelo 650) processed through the national tax agency rather than the regional one. More distant relatives (Group III, such as siblings, nieces and nephews) now receive a partial bonus of 35% or 60% depending on the circumstances.

There is also a uniquely Balearic instrument worth knowing about: the pacto sucesorio, a lifetime succession agreement under Balearic civil law. It allows parents to transfer property to children during their lifetime while being treated as an inheritance, which means no personal income tax on the gain for the person transferring, plus a step-up in the value base. It is a powerful planning tool, but it is irrevocable, so specialist advice is essential.

Holiday Rental Licences in Mallorca

If part of your plan is to earn rental income, do not assume every property can be let to tourists. Holiday rental in Mallorca requires a tourist licence (ETV), and these are tightly regulated and restricted by zone, property type and municipality. Many apartments in particular cannot obtain a licence at all.

Before buying for rental income, the property must be checked not only for its appeal but for its legal rental potential. Read our buying guides and take professional advice before you commit.

Common Tax Mistakes Non-Resident Owners Make

Assuming that paying IBI covers everything. The IBI is a local tax; the Modelo 210 is a separate national income tax.
Not filing because the property is empty. An unrented holiday home still owes imputed income tax every year.
Filing one return for a jointly owned home. Each owner must file separately for their share.
Forgetting the part-year split when a home is let for only part of the year.
Ignoring wealth tax on high-value homes, where Mallorca, unlike Madrid, does apply it.
Underestimating purchase costs by budgeting only the ITP and forgetting notary, registry, legal and gestoría fees.

How Much Tax Should You Budget?

As a working rule for 2026, a non-resident buyer in Mallorca should plan for:

- Around 10% to 12% on top of the price for a resale home, or up to 13% to 14% in the luxury market
- Around 11.5% to 12% for a new build (10% VAT plus 1.5% stamp duty plus costs)
- A modest annual income tax (often a few hundred to around a thousand euros for a typical holiday home) plus IBI
- Potential wealth tax only on high-value estates above the 700,000 € per-person allowance

Every situation is different, and a personalised tax simulation before you sign the reservation contract is always worthwhile.

Frequently Asked Questions About Non-Resident Taxes in Mallorca

Do I pay tax in Spain if my Mallorca home is empty?

Yes. Even an unrented holiday home generates imputed income tax for non-residents. It is calculated as 1.1% or 2% of the cadastral value, taxed at 19% for EU residents or 24% for non-EU residents, and filed annually on Modelo 210 by 31 December of the following year.

What is the property transfer tax in Mallorca?

For resale homes, the Balearic ITP is progressive from 8% up to 13%. It is 8% on the first 400,000 €, 9% up to 600,000 €, 10% up to 1,000,000 €, 12% up to 2,000,000 € and 13% above that, calculated band by band.

Do non-residents pay wealth tax in Mallorca?

Possibly. Wealth tax applies to net Spanish assets above an allowance of 700,000 € per owner. Unlike Madrid, the Balearic Islands do not fully eliminate it, so high-value estates can pay. A separate national solidarity tax applies above 3 million euros.

How much is non-resident income tax in Spain?

The rate is 19% for residents of the EU, Norway, Iceland and Liechtenstein, and 24% for all other non-residents. It applies to imputed income on a home you use yourself, and to actual rental income if you let the property.

Do I have to pay inheritance tax on a Mallorca property?

For close family (children, parents, spouses) the Balearic Islands apply a 100% bonus with no value limit, so direct-family inheritance is effectively tax-free, and this relief now applies to non-residents too. More distant relatives receive a partial bonus.

What taxes do I pay when selling a property in Mallorca?

Non-residents pay 19% capital gains tax on the profit, with the buyer withholding 3% of the price as an advance. The seller files a Modelo 210 within four months to settle or reclaim. A local plusvalía municipal is also payable to the town hall.

Can EU and non-EU buyers both deduct rental expenses?

EU and EEA residents can deduct costs linked to the rental and are taxed at 19% on the net. Non-EU residents have traditionally been taxed at 24% on the gross, although a 2025 court ruling is extending deduction rights to non-EU owners. Confirm the current position with a tax adviser.

Plan Your Mallorca Purchase With Confidence

Tax should never be the reason not to buy in Mallorca, but it should always be part of the plan. Understanding ITP, annual income tax, IBI, wealth tax and the island’s generous inheritance rules from the outset allows you to budget accurately and buy with confidence.

If you are ready to start, explore the latest property for sale in Mallorca and browse our selection of luxury villas and country homes across the island. With the right local guidance, and independent legal and tax advice, your Mallorca purchase can be as straightforward as it is rewarding.

This guide is for general information only and does not constitute legal or tax advice. Tax rates and rules change and vary by situation. Always consult a qualified Spanish tax adviser before buying, letting or selling.