Purchase of second-hand real estate will be taxed under ITPAJD in the Balearic Islands

The acquisition of second-hand real estate entails specific tax obligations that buyers must be aware of to avoid errors in their tax settlements. Recently, the Dirección General de Tributos (DGT) has clarified the tax treatment of these operations within the scope of Transfer Tax and Stamp Duty (ITPAJD).

What the DGT has resolved

The administration has confirmed that the purchase of a used property constitutes an onerous transfer of assets. This implies that the operation is subject to ITPAJD, with the acquirer being the taxable person obligated to pay the tax.

Regarding the determination of the taxable base, the ruling indicates that the Cadastre reference value will be used. However, if the price agreed upon in the deed or the declared value turns out to be higher than the reference value, the higher of these magnitudes must be applied for the tax calculation.

What it means for you

If you are an individual or a foreigner acquiring property in Spain, you must take into account that the tax burden does not depend solely on the purchase price, but on the comparison with the official Cadastre values. In the specific case of the Balearic Islands, the management and settlement of this tax correspond to the regulations of said Autonomous Community.

For non-habitual residents or foreigners, this tax represents a direct cost in the real estate investment that must always be budgeted considering the Cadastre reference value as the minimum taxation amount.

What is advisable to do

Before formalizing any purchase and sale operation of used real estate, it is necessary to verify the reference value of the property on the Cadastre's electronic office. This will allow you to know the real taxable base upon which the tax rate of the corresponding autonomous community will be applied. Since regulations may vary depending on the location of the property, it is fundamental to analyze the particular situation of each transaction to ensure compliance with tax obligations.