Costs, taxes & fees
What to budget beyond the asking price, and the taxes involved in buying, owning and selling.
What extra costs should I budget on top of the purchase price?
On a resale purchase, budget roughly 10–13% on top of the price for taxes and fees. This covers transfer tax, notary, Land Registry and your lawyer.
We give you an itemised estimate for your specific purchase before you make an offer, so there are no surprises.
What property taxes do I pay when buying?
Resale homes in the Balearic Islands pay Transfer Tax (ITP) on a sliding scale that rises with the price. New-builds pay VAT (currently 10% for homes) plus stamp duty (AJD).
Rates change, so we confirm the exact figures with your lawyer for your purchase.
What are the ongoing costs of owning a property?
Expect annual IBI (council tax), rubbish collection, community fees if it is part of a complex, utilities, home insurance, and non-resident income tax if you do not live in Spain full-time.
We can give you a realistic annual running-cost estimate for any property you are considering.
Who pays the estate agent's fee?
In Mallorca the agent's commission is normally paid by the seller and is already reflected in the asking price. As a buyer, you typically do not pay us a separate fee.
If you ask us to run a dedicated off-market search, we agree any terms with you in writing first.
What is the "valor de referencia" and how does it affect my tax?
Spain sets a reference value for many properties. Purchase tax is calculated on the higher of the price you pay or that reference value.
Your lawyer checks the reference value before you buy so the tax bill is no surprise.
Do I pay tax when I sell?
Yes. Sellers pay capital gains tax on the profit and the municipal plusvalía on the increase in land value. Non-residents also have a percentage withheld at completion.
Costs such as your purchase taxes and qualifying improvements can reduce the gain. We work with tax advisors who help you plan ahead.
