The purchase price is only part of what you'll pay when buying or selling property in Ibiza. Understanding the full tax and cost picture before you commit is essential — and often surprises first-time buyers.
One of the most common surprises for first-time buyers in Ibiza is the gap between the purchase price and the total amount they actually spend. In Spain, the additional costs of buying property are substantial — typically 10–13% on top of the purchase price — and failing to budget for them accurately can create serious financial problems at the point of completion.
This guide covers the key taxes and costs for both buyers and sellers in Ibiza's current market.
Costs for Buyers
Transfer Tax (ITP) is the main tax paid when buying a resale property. In the Balearic Islands, ITP is calculated on a sliding scale: 8% on the first €400,000, 9% on the portion between €400,000 and €600,000, 10% on the portion between €600,000 and €1,000,000, and 11.5% on the portion above €1,000,000. For a property purchased at €2,000,000, this means an ITP bill of approximately €190,000.
VAT (IVA) applies instead of ITP when buying a new-build property from a developer. The rate is 10% for residential properties, plus a 1.2% Stamp Duty (Actos Jurídicos Documentados).
Notary and Land Registry fees are typically 0.5–1% of the purchase price combined. These are fixed-scale fees set by the Spanish government and do not vary significantly between notaries.
Legal fees for a qualified property lawyer typically run between 1% and 1.5% of the purchase price, with a minimum fee for lower-value transactions. This is not an area to economise on — the cost of a legal problem discovered after completion will always exceed the cost of proper legal advice before it.
In total, buyers should budget for 10–13% of the purchase price in additional costs, depending on whether the property is new or resale and whether a mortgage is involved.
Costs for Sellers
Capital Gains Tax (CGT) is payable on the profit made from the sale. For Spanish tax residents, the rate is 19% on the first €6,000 of gain, 21% on gains between €6,000 and €50,000, 23% on gains between €50,000 and €200,000, and 27% on gains above €200,000. For non-residents, a flat rate of 19% applies (for EU/EEA residents) or 24% (for non-EU residents).
The 3% Retention is a mechanism specific to non-resident sellers. When a non-resident sells a property in Spain, the buyer is legally required to retain 3% of the purchase price and pay it directly to the Spanish Tax Agency as an advance payment against the seller's CGT liability. If the actual CGT is less than 3%, the seller can claim a refund.
Plusvalía Municipal is a local tax charged by the municipality on the increase in the cadastral value of the land since the property was last sold. Following a Constitutional Court ruling in 2021, the tax is now calculated on actual gains rather than a fixed formula, which has reduced the liability for many sellers.
Agent commission in Ibiza is typically 5% of the sale price plus VAT (21%), paid by the seller. This is the standard market rate for full-service representation.
Planning Ahead
The most important thing both buyers and sellers can do is engage a qualified Spanish tax adviser before completing any transaction. The interaction between Spanish income tax, capital gains tax, wealth tax, and inheritance tax is complex — particularly for non-residents — and the decisions made at the point of purchase can significantly affect the tax position at the point of eventual sale.
