Residents pay capital gains tax through their annual IRPF return under progressive Ahorro rates; non‑residents pay a flat 19% via Modelo 210. Plusvalía is charged separately by the town hall, regardless of whether you made a profit.
TL;DR: Non‑resident sellers pay a flat 19% capital gains tax through Modelo 210, with the 3% withholding act as an advance payment rather than an extra tax. The acquisition cost used for calculating gain includes the original purchase price, transfer tax or VAT, notary fees, and documented structural improvements; routine maintenance cannot be deducted. Plusvalía municipal is a town hall tax based on land value increase, and sellers can challenge it by comparing actual sale and purchase prices or requesting its lower “real” calculation method. Sellers aged 65 or over may be exempt from capital gains tax if they sell their habitual residence, subject to specific conditions. Proper documentation and early municipal checks are essential to avoid overpaying taxes or facing delays in refund processing.
TL;DR:
The taxable gain is simply your sale price minus your acquisition cost, adjusted for allowable deductions. That acquisition figure isn’t just what you originally paid. It also includes the transfer tax or VAT you paid at purchase, notary and registry fees, and the cost of any structural improvements you can document with invoices.
On the sale side, you can deduct the estate agency commission and your own legal or notary costs. What you can’t deduct is routine maintenance, painting, or anything cosmetic rather than structural. Keep every invoice; the tax authority will ask for them if your return is checked.
How the rate differs by residency status:
Pro Tip: If you’re planning to reinvest the entire proceeds into a new main residence within two years, ask your gestor about the reinvestment exemption before completion, not after. The AEAT reinvestment rules set strict conditions and deadlines, and missing the paperwork window can forfeit an otherwise valid exemption.
Sellers aged 65 or over selling their habitual residence may also be exempt from capital gains tax altogether, subject to conditions set out by the AEAT’s over‑65 exemption rules. Special regimes also exist for annuities and certain reinvestment structures, so anyone in an unusual situation should speak to a tax adviser before signing anything.
Plusvalía municipal (formally IIVTNU) is a town hall tax charged on the theoretical increase in the value of the land under your property, not the building itself, and not your actual sale profit. It’s calculated using the cadastral land value and a coefficient set by each municipality, which is why the bill can vary noticeably between, say, Palma and a smaller inland town.
Sellers have a choice. The town hall can apply its own objective statutory formula, or you can ask it to use the “real” method, comparing your actual purchase and sale prices, whichever produces the lower liability, as explained by Modelo210Online’s plusvalía guide.
Steps to check you’re not overpaying:
Pro Tip: Many Mallorca municipalities set their coefficients close to the statutory maximum, so this tax can be surprisingly large on properties held for many years. Checking Balearic municipal tax guidance early, ideally before you even list the property, gives you time to gather the evidence needed to argue for a lower figure.
When the seller is a non‑resident, the buyer is legally obliged to withhold 3% of the agreed price at completion and pay it to the tax authority using Modelo 211 within one month of the notarial deed. This isn’t an extra tax; it’s an advance payment against whatever capital gains tax you actually owe.
Bring an up‑to‑date residency certificate to completion to avoid this.
Deductible costs fall into a fairly short, well‑defined list: the ITP or VAT paid on your original purchase, notary and registry fees from both purchase and sale, your estate agency commission, and structural improvements backed by invoices, such as a new roof or a bathroom extension. Cosmetic work, furniture, and general upkeep don’t count.
Worked example: Say a non‑resident bought an apartment in Palma for €400,000 in 2015, paid €32,000 in ITP, and spent €25,000 on a documented kitchen and bathroom renovation. They sell in 2026 for €650,000, paying €19,500 in agency commission. Their taxable base is roughly €650,000 minus (€400,000 + €32,000 + €25,000 + €19,500) = €173,500. At the non‑resident flat rate, that’s a capital gains liability of around €32,965, according to the flat 19% rate confirmed in AEAT’s non‑resident manual. Where costs need apportioning across multiple owners or mixed‑use properties, bring in an accountant rather than guessing.
The clock starts ticking the moment the notarial deed is signed, and several deadlines run in parallel from that date.
Keep the original purchase deed, every renovation invoice, the plusvalía notification, and your NIE or residency certificate together in one file before completion day.
Pro Tip: If you discover after completion that residency was recorded incorrectly, you can still reclaim wrongly withheld amounts through Modelo 210, but it’s far simpler to correct the paperwork before signing than to chase a refund afterwards.
Years of handling sales across Mallorca have shown us that the biggest headaches are rarely about the tax rates themselves. They’re about missing paperwork. Sellers who arrive at the notary without their original purchase invoices, or without proof of structural works carried out a decade earlier, often end up paying tax on a gain that’s larger than it should be.
We encourage every seller to pull together IBI receipts, cadastral references, and improvement invoices well before listing, and we liaise directly with local notaries and gestores to flag municipal quirks, particularly plusvalía coefficients, that catch international owners off guard. Our property guide covers this groundwork in more detail.
Filing correctly starts with confirming your residency status, because that single fact determines which form you use and which deadline governs you. Non‑residents use Modelo 210 within four months of the deed date; residents fold the sale into their standard annual IRPF return the following spring.
Without that receipt, you cannot properly reconcile what’s owed against what’s already been withheld.
Non‑residents typically use Modelo 210’s online submission through the AEAT’s electronic office, which calculates the balance due or refund automatically once the figures are entered.
A frequent error is filing before the buyer has actually submitted Modelo 211, which delays matching the withheld amount to your return. Wait for confirmation the withholding has been paid, usually within a few weeks of completion, before submitting your own declaration. Sellers with more complex situations, joint ownership, inherited properties, or partial reinvestment, should have a gestor review the return before submission rather than filing solo, since errors at this stage are far harder to correct retrospectively than to prevent.
Refunds owed after filing Modelo 210 aren’t instant. The AEAT typically takes several months to process a non‑resident capital gains refund, and delays are more common when the return includes deductions that need supporting documentation the tax office wants to verify first. If your refund seems unusually slow, check that every invoice referenced in your return was actually attached or available on request; incomplete documentation is the most frequent cause of a stalled claim.
If you disagree with the amount the AEAT calculates, whether that’s a rejected deduction or a dispute over the applicable rate, you can lodge a formal appeal (recurso de reposición) within the standard one‑month window from notification, or escalate to an economic‑administrative claim if the initial appeal is rejected. The same principle applies to plusvalía municipal: if the Ayuntamiento’s calculation seems too high, you can request a review using the real method comparison described earlier, and if that’s refused, appeal directly to the municipality’s own tax office within its stated deadline.
Sellers based abroad sometimes find managing these timelines from a distance frustrating, particularly when a notary requires original signed documents. Where you’re not resident in Spain and can’t easily attend in person, a locally based gestor or documentation specialist can handle apostille and certification requirements on your behalf, which speeds up both the initial filing and any subsequent dispute.
Selling in Mallorca isn’t complicated once you know the sequence: confirm your residency, gather your invoices, check the municipal coefficient, and file on time. Most tax headaches here come from missing paperwork, not the rates themselves.
Start collecting your purchase deed, improvement invoices, and residency proof now, and talk to a local tax adviser or notary before you list. If you’d like tailored guidance from people who handle these sales daily, our team is happy to help.
— Sophie
It depends on your residency and profit margin: residents pay progressive Ahorro rates roughly between 19% and 28% on the gain, while non‑residents pay a flat 19%, plus separate plusvalía municipal.
Non‑resident sellers pay a flat 19% capital gains rate via Modelo 210, with the buyer withholding 3% of the price upfront and plusvalía municipal charged separately by the town hall.
ITP is paid by the buyer on purchase, not by the seller, but the ITP the seller originally paid when they bought the property is deductible against their capital gains calculation when they later sell.