The cost of buying property in Mallorca, on top of the price

The cost of buying property in Mallorca is not a rounding error on top of the price, and the largest item on the bill depends on something most buyers leave until late: whether the property is a resale or a new build. On a resale the rate is set by the Balearic government rather than by Madrid. On a new build the VAT rate is national, and only the stamp duty charged on top of it is Balearic.

The national page sets out what applies across the country: which tax you pay, how the reference value works, and what the professional fees consist of. That is the cost of buying property in Spain. This page is about what is different here. Two things are. Transfer tax in the Balearics runs progressively across price bands rather than at one flat rate, and at Mallorca prices that changes the arithmetic noticeably. And the stamp duty on a new build is set regionally as well.

The calculator above gives you the order of magnitude for a Balearic purchase. What it computes, and where it stops, is set out below — read both before you budget against its number.

About the figure the calculator gives

These guides do not print tax rates in the prose. A rate that is set regionally and revised every few years is wrong from the day it changes, with no way for a reader to tell.

A calculator cannot follow that rule; it has to compute. So the rule is honoured differently here: every rate it uses sits in one place in the source, carries the date it was last checked, and that date is printed beside the result. A stale rate becomes visible to you rather than hidden from you.

That makes the figure a sound planning number, and not advice. Before you sign, have it confirmed for your specific property by your lawyer or tax adviser.

Resale: the Balearic transfer tax

Buy from a private owner and you pay ITP — Impuesto sobre Transmisiones Patrimoniales, transfer tax.

It is set by the autonomous community, not by Madrid. The Balearic Islands set their own rates, and they differ from Catalonia’s or Andalusia’s. Guidance written about “Spain” without naming a region is not guidance about Mallorca, and a percentage lifted from a mainland article is the wrong percentage here.

The second feature is the one that trips people up. Balearic transfer tax is progressive by price band. The rate is not a single figure applied to the whole purchase; successive slices of the price are taxed at rising rates. Two consequences follow. The effective rate on an expensive property is higher than on a modest one, and neither of them equals the headline top rate you will see quoted. The gap between the top band and the effective rate is not a technicality; it is the difference between a budget that works and one that does not.

The bands themselves are published by the regional tax authority, ATIB, and they have been revised more than once in recent years. Applying the top rate to the whole price — the most common mistake in online estimates — overstates the bill substantially. The calculator applies the bands, which is exactly why it exists.

New build: stamp duty is regional too

Buy from a developer and ITP does not apply. IVA, Spanish VAT, is charged on the price at the rate for residential property, set nationally and therefore the same in Mallorca as anywhere else in Spain.

What is regional is AJD — Actos Jurídicos Documentados, stamp duty on the notarised deed — which is charged on top at a rate set by the Balearic government.

The combined figure for a new build usually lands in a similar region to the transfer tax on a mid-priced resale, though the two diverge at the extremes of the price range. Which route works out cheaper is a question you can only answer on a specific property, and it is worth answering before you narrow a search to one or the other.

The reference value, and what to enter in the calculator

The taxable base is not always the price you agree. Where the cadastre’s valor de referencia for the property is higher, the transfer tax is assessed on that figure instead. How it works in full, including what happens to it on a new build, is on the cost of buying property in Spain.

The practical step on a Mallorca purchase is to look the figure up at the cadastre before you offer, at no cost, and if it comes out above your price, enter the reference value in the calculator rather than the price. Because Balearic transfer tax is banded, that value can also decide which bands the purchase falls into.

Professional costs, and the part the mortgage will not cover

Notary, Land Registry, gestoría and your lawyer are charged on the same basis across Spain, on official tariffs plus a legal fee that is negotiable. What each one does, and why we would never encourage anyone to skip the lawyer, is on the national page.

Worth restating here because it is where Mallorca budgets break: Spanish lenders lend against the price, so none of the tax and none of the fees can be financed. They come out of cash, alongside the deposit. Because the Balearic tax is banded, that cash line is a larger share of the price at the upper end of the market than at the lower. If you are financing, read this alongside mortgages for non-residents.

A planning figure for a Mallorca budget

Before you have a specific property, use the national planning range to set a search budget, then narrow it with the calculator once you know the price band. Where you fall inside that range depends on the band, on resale versus new build, and on what you agree with your lawyer. Because the Balearic bands rise with price, an expensive Mallorca property sits nearer the top of the range than a modest one does.

Once there is an actual property, the number can be calculated exactly — and it should be, before you sign anything.

And afterwards

The costs do not stop at completion. IBI falls due annually to the municipality, community charges apply in most developments, and as a non-resident owner you acquire annual filing obligations whether or not the property earns anything. Those are set out in non-resident property tax.

If you are still choosing where on the island to look, the buyer’s view of the market is in buying property in Mallorca.

Frequently asked questions

How much does buying property in Mallorca cost on top of the price?

The purchase tax is the largest item, and in the Balearics it is banded, so the answer moves with the price. Add notary, Land Registry, gestoría and legal fees on top. Use the calculator for a planning figure on your price band, then have it confirmed for the specific property before you sign.

What is ITP in the Balearics?

Spanish transfer tax, payable on resale property. It is set by the autonomous community — in Mallorca’s case the Balearic Islands — and charged progressively across price bands, so the effective rate rises with the purchase price and never equals the headline top rate quoted for the top band.

Do I pay VAT or transfer tax on a Mallorca property?

On a new build from a developer, VAT plus the Balearic stamp duty. On a resale from a private owner, the banded Balearic transfer tax. Never both regimes on the same purchase. The VAT rate is national, so on a new build the only Balearic element is the stamp duty charged on top of it.

Will a mortgage cover the Mallorca purchase costs?

It will not. The loan is advanced against the property price, so the tax and the fees are funded separately, in cash, alongside the deposit. That is the most common reason a Mallorca buyer who budgeted carefully still arrives at completion short. Set the money aside before you make an offer.

Is the reference value different in the Balearics?

No. It is set per property by the cadastre, and where it exceeds the agreed price it becomes the base the transfer tax is assessed on. What is Balearic is the rate applied to that base. Look the value up before you offer, and if it is higher than your price, use it in the calculator.

Who chooses the notary?

The buyer normally does, and the fees follow a published tariff, so the choice is about convenience and availability rather than price. Because the tariff is published, the fee does not change from one notary to the next, so there is nothing to shop around for on this line of the bill.

Why does the calculator show a range rather than one figure?

Notary, Land Registry and gestoría charge on official tariffs that depend on the price and on the complexity of the deed — several buyers, a mortgage, a newly declared extension. A single figure there would be false precision, so the calculator shows the span those tariffs can produce.