Taxes & Finance

ITP: Property Transfer Tax in the Balearics

ITP is the main purchase tax on second-hand property in Spain. In the Balearics, rates are among the highest in the country — up to 13%.

Updated 15 May 2026·8 min read

In short

ITP (Impuesto sobre Transmisiones Patrimoniales) is the purchase tax you pay when buying a second-hand property in Spain. In the Balearic Islands, rates run from 8% to 13% depending on the purchase price. It is paid by the buyer, once, at the point of purchase — and is typically the largest tax cost in a property transaction.

What is ITP?

ITP applies to all purchases of second-hand (resale) property in Spain. New builds from a developer are taxed differently — they pay IVA (VAT) and AJD instead of ITP. See our IVA and AJD guide for new builds.

ITP is a regional tax, which means each autonomous community sets its own rates. The Balearic Islands (Mallorca, Ibiza, Menorca, Formentera) have some of the highest ITP rates in Spain.

Balearics ITP rates (2026)

How the graduated scale works:

For a €750,000 property:

  • First €400,000 at 8% = €32,000
  • Next €200,000 (€400k–€600k) at 9% = €18,000
  • Next €150,000 (€600k–€750k) at 10% = €15,000
  • Total ITP: €65,000

ITP is on the declared value — but Hacienda can revise upwards

If Hacienda (or the Balearic tax authority) believes the declared sale price is below market value, they can issue a complementary tax demand based on their own valuation. This is called a "comprobación de valores" and is relatively common on the islands.

When and how is ITP paid?

ITP must be paid within 30 working days of signing the escritura (title deed). Your notary and gestoría will typically manage this process for you. The steps:

  1. Sign escritura at the notary
  2. Gestoría calculates ITP owed
  3. You transfer funds to the gestoría's client account
  4. Gestoría files Modelo 600 (the ITP return) and pays the tax
  5. Escritura is registered at the Land Registry

Is ITP deductible?

ITP paid on your purchase is added to the acquisition cost of your property for capital gains purposes. When you eventually sell, this reduces your taxable gain.

Reductions and exemptions

The Balearic government periodically offers reduced ITP rates for specific situations:

  • Primary residence for buyers under 36
  • Disabled buyers
  • Large families

As a non-resident buying a holiday home, you will not qualify for these reductions. You pay the standard rate.

Professional help

Need help with this?

Spanish tax filings and bureaucracy can be complex. A local gestoría can handle Modelo 210, NIE applications, and other filings on your behalf.

Find a gestoría →

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