Buying a second residence in Spain means budgeting for two distinct groups of tax: one‑off purchase taxes and ongoing ownership taxes. On a resale property you pay Impuesto sobre Transmisiones Patrimoniales (ITP), typically between about 6% and 10% depending on the region. On a new build, you pay 10% VAT (IVA) plus Actos Jurídicos Documentados (AJD), usually between roughly 0.5% and 1.5%. Once you own the property, expect annual IBI (local property tax) and, if you are a non‑resident, a non‑resident income tax return even when the home sits empty.
The Agencia Tributaria (AEAT) sets the national framework, but Kreston Iberaudit’s 2026 guide for non‑residents is a useful, current reference for how the rules apply once you own the property. As a Mallorca specialist, Vogue Properties Mallorca regularly walks international buyers through exactly this budgeting exercise before they make an offer.
Budgeting for a second home in Spain means separating the one‑off purchase tax from the annual ownership tax and the eventual sale tax, since each is calculated differently and falls due at a different time.
Which tax applies depends entirely on whether you buy a resale property or a new build, and second homes almost always cost more in tax than a main residence. Most autonomous communities reserve their reduced ITP rates for first‑time buyers of a primary residence, so a second home usually pays the full rate with no discount.
For a resale, ITP is calculated on the higher of the purchase price or the reference value set by the tax authority, and rates vary by autonomous community and by value band, commonly landing between 6% and 10%. For a new build bought directly from a developer, you pay 10% IVA instead of ITP, plus AJD stamp duty on the mortgage and title deed, typically 0.5% to 1.5% depending on the region. The buyer pays both taxes, and they are due shortly after completion, alongside notary and Land Registry fees.
Once the deeds are signed, the tax picture shifts from one‑off to ongoing. Every owner pays annual IBI, calculated on the cadastral value (valor catastral), which is usually well below market price. Non‑resident owners then face a separate obligation: even a property used purely for personal enjoyment must declare imputed income, set at 1.1% or 2% of the cadastral value depending on when it was last revised, taxed at 19% for EU/EEA residents or 24% for non‑EU residents. Rent it out, and actual rental income replaces the imputed figure, filed on the same Modelo 210 form.
Selling triggers a third layer. The buyer withholds 3% of the sale price as an advance against your capital gains tax bill, and most municipalities also charge plusvalía municipal, a local tax on the increase in the land’s value during your ownership.
Financing a second home in Mallorca usually means a lower loan to value than buyers expect. Community fees, waste collection tax, and higher insurance premiums on coastal properties also catch people out. Transfer tax and AJD are settled shortly after signing, usually organised through the notary and a local gestoría.
Pro Tip: Always confirm the exact ITP and AJD rates for your specific Comunidad Autónoma before finalising a budget. Rates for the Balearic Islands can differ meaningfully from mainland Spain.
Vogue Properties Mallorca gives you a clearer starting budget than browsing listings alone, because our team factors likely ITP, IVA, and IBI bands into the property search from day one, rather than leaving tax as a surprise at completion.
We can introduce you to a trusted local gestoría, guide you through opening a Spanish bank account ahead of completion, and talk through the practicalities of your NIE. Where rental income is part of your plan, we can also point you towards the licensing and declaration steps that matter in Mallorca specifically. None of this replaces a qualified tax advisor, but it means you arrive at that conversation already informed. If you are ready to see what fits your budget, browse properties for sale in Mallorca or get in touch to talk through your plans.
For the official rules and Modelo 210 forms, start with the Agencia Tributaria. Kreston Iberaudit’s 2026 guide for non‑residents is the most current specialist summary of NRIT and double taxation agreements. For plain‑English overviews of purchase taxes, Expatica and Idealista are reliable, while Flyto’s guide covers non‑resident filing in detail. Always confirm regional ITP and AJD rates with a local gestoría or the Vogue Properties Mallorca team before finalising your budget.
This article is general information, not a substitute for advice from a qualified financial advisor. Consult a qualified financial professional about your own circumstances before acting on anything here.
On a resale, you pay ITP at roughly 6% to 10% of the purchase price. On a new build, you pay 10% IVA plus AJD at roughly 0.5% to 1.5%.
Yes.
Generally yes, because most regions reserve reduced ITP rates for first‑time buyers of a primary residence, so second homes usually pay the standard rate.
Vogue Properties Mallorca can factor likely ITP, IVA, and IBI bands into your property search and introduce you to trusted local gestorías for detailed tax advice.