Taxes on the purchase
| Property | Main tax | Notes |
|---|---|---|
| Resale home or villa | Transfer tax (ITP) | Balearic progressive rate starting at 8% and rising for higher values |
| New-build home | VAT 10% + stamp duty (AJD) | Paid on the first transfer from the developer |
| Plots and commercial premises from a business | VAT 21% + stamp duty | Depending on the seller and the property |
Because Ibiza property values are high, many purchases fall into the upper bands of the transfer tax scale. Your lawyer calculates the exact figure before you commit.
Notary, Land Registry and legal fees
Notary and Land Registry fees follow official scales and depend mainly on the price. Legal fees are agreed with your lawyer: many firms quote a percentage of the price plus VAT, others a fixed fee. A complete quote should cover due diligence, contracts, NIE, completion, taxes and registration.
Mortgage costs
With a mortgage, the bank charges a valuation and may charge other fees; most of the notary and registry costs of the mortgage deed are borne by the bank under current law. Non-residents usually obtain a lower loan-to-value.
Retentions when the seller is non-resident
If the seller is not resident in Spain, the buyer must withhold 3% of the price and pay it to the tax office. It is not an extra cost for you, but if it is not paid, you can become liable for the seller's tax.
Yearly costs of owning in Ibiza
| Cost | Who pays |
|---|---|
| IBI (municipal property tax) | All owners, every year |
| Waste collection tax | All owners, according to the municipality |
| Non-resident income tax | Non-residents, on imputed income or rental income |
| Wealth tax | Owners above the thresholds |
| Community fees | Apartments and gated developments |
When you sell
Sellers pay capital gains tax and the municipal plusvalía; purchase costs usually increase the acquisition value and reduce the gain. See selling property in Ibiza. For the whole process, read buying property in Ibiza. This guide is published by Ibiza.law, part of Castell.law.
An illustrative example
Based on situations we commonly see; not a specific client. A buyer purchasing a resale villa in Santa Eulària budgeted only for the price and the agent's fee. When we prepared the cost estimate, the transfer tax at the upper bands of the Balearic scale, the notary, the Land Registry, legal fees and the costs of the mortgage added a significant amount. Knowing the full figure before signing the arras contract allowed the buyer to adjust the offer and the mortgage request in time.
Before you sign or pay, ask a lawyer
Send us the document, the listing or a short summary of the problem. A lawyer will tell you what matters, what it could cost you and what to do next.
Frequently asked questions
How much is transfer tax in Ibiza?
It follows the Balearic progressive scale, starting at 8% and rising for higher-value properties. Your lawyer calculates the exact amount.
Do new builds pay transfer tax?
No. The first sale by the developer pays VAT and stamp duty instead.
Who pays the notary in Ibiza?
Usually the buyer pays the notary for the purchase deed, unless the contract says otherwise.
Do non-residents pay tax every year?
Yes. Non-residents pay non-resident income tax on their Spanish property, even when it is not rented.