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AJD Spain in Mallorca: The Stamp Duty on New Builds, Mortgages and Deeds

Responsible for this content: Frank Menze

Anyone buying a property in Mallorca will almost always come across three abbreviations: ITP, IVA and AJD. While ITP applies mainly to resale properties and IVA to new-builds, the AJD (Actos Jurídicos Documentados, in English: tax on documented legal acts) is often underestimated – yet it can additionally apply when buying a new-build, when setting up a mortgage, and for numerous other notarial deeds. In this guide, you'll learn when AJD applies, how it differs from ITP and IVA, what rates apply in the Balearics, and how to realistically calculate your tax burden when buying a property.

AJD Spain: stamp duty on new builds and mortgages in Mallorca

Are you planning a property purchase in Mallorca and want to accurately calculate the additional costs including AJD?

What is the AJD tax and when does it apply?

The AJD belongs to the group of taxes known as "Impuesto sobre Transmisiones Patrimoniales y Actos Jurídicos Documentados" (ITPAJD) and – unlike ITP or IVA – does not tax the transfer of ownership itself, but rather the notarial certification and registration of certain transactions in public registers such as the Land Registry. In practice, this means: whenever a transaction is notarised and registered in the Registro de la Propiedad, AJD may become due in addition to another tax (usually IVA). This typically applies to the purchase of a new-build property as well as to the setting up of a mortgage.

The distinction is important: resale properties are generally subject to ITP, whereas new-builds are subject to IVA – the two taxes are mutually exclusive and are never charged in parallel. AJD is independent of this and regularly applies in addition to IVA for new-builds and mortgage deeds.

AJD vs. ITP vs. IVA: How the three taxes interact

For buyers in Mallorca, it's crucial to understand which tax applies to which type of property. The table below shows the basic logic:

Property type Main tax Additionally possible AJD relevant?
Resale property (second-hand) ITP (tiered, Balearics) – generally no
New-build property (first occupancy) IVA 10 % (residential property) AJD yes
Commercial property / land owned by companies IVA 21 % AJD yes
Mortgage deed (regardless of property type) – AJD on the mortgage setup yes

Note: Property transfer tax (ITP) and value added tax (IVA) are never charged simultaneously when buying a property. AJD must be considered separately, as it is linked to the notarial deed itself.

AJD on new-build purchases in Mallorca

If you buy a new-build property for first occupation – for example, directly from the developer – the purchase price is subject to IVA. For residential properties, including up to two associated garage spaces per dwelling, a rate of 10% IVA applies. If, on the other hand, it is a plot of land sold by a commercial enterprise, or a commercial property, the IVA rate is 21%. In addition to IVA, AJD is charged on new-build purchases, based on the value stated in the notarial deed.

New-build purchase price (example) IVA (10%) AJD (1.5%) Approximate total charge
300.000 € 30.000 € 4.500 € 334.500 €
600.000 € 60.000 € 9.000 € 669.000 €
1.200.000 € 120.000 € 18.000 € 1.338.000 €

Note: The examples are calculated using the general Balearic AJD rate of 1.5%. For a first main residence up to 270,151.20 euros, a reduced rate of 1% applies. For people under 36, people with disabilities, as well as large families and single-parent families, a super-reduced rate of 0.5% applies to the first 270,151.20 euros, with the portion above that taxed at 1.5%.

This is how the ATIB itself calculates it: A person under 30 buys a new-build flat in Palma on 23 June 2026 for 325,000 euros. The 100% relief introduced by the Ley 4/2026 applies — but only to the tax liability on the first 270,151.20 euros. The excess amount of 54,848.80 euros is charged at the general rate of 1.5%. The amount payable is 822.73 euros. Before 14 June 2026, it would have been 4,064.54 euros (1.2% on the first 270,151.20 euros, 1.5% on the excess).

AJD on the mortgage deed

If you take out a mortgage to buy the property, the granting of the mortgage loan is also formalised in a notarial deed and registered in the Land Registry. This process too can be subject to AJD, as it constitutes a separate documented legal act – regardless of whether the underlying property is a new-build or a resale property. Anyone planning financing should therefore budget for AJD as its own cost item alongside notary, Land Registry and bank fees, and clarify with the financing bank and their own lawyer how the costs are allocated in each individual case.

Type of cost when taking out a mortgage When it falls due
AJD on the mortgage deed upon notarial execution of the mortgage
Notary fees (purchase deed) upon signing the escritura
Land Registry registration after notarisation
Bank fees (e.g. valuation report) as part of the loan approval process

You can find more details on financing in our guides on mortgages for non-residents and on comparing fixed vs. variable rate mortgages.

AJD on other notarial deeds

Besides the purchase of new-build property and the granting of a mortgage, AJD can in principle also become relevant for other notarised and register-required transactions, for example certain amendments or supplementary agreements relating to a property. In practice, for buyers in Mallorca the purchase of a new-build property combined with taking out a mortgage at the same time is a common case in which AJD is charged in two steps: once on the purchase deed and once on the mortgage deed.

Overview of tax rates and calculation examples

Since AJD, ITP and IVA interact differently depending on the type of property, it is worth taking an overall look at the rates relevant in the Balearic Islands:

Tax Rate Applies to
ITP (tiered) 8 % up to €400,000 Second-hand property
ITP 9 % for the portion 400,001–600,000 € Second-hand property
ITP 10 % for the portion 600,001–1,000,000 € Second-hand property
ITP 12 % for the portion 1,000,001–2,000,000 € Second-hand property
ITP 13 % for the portion above 2,000,001 € Second-hand property
ITP reduced (2 %) 2 % on the first 270,151.20 €, the excess at the general rate of 8 % among others, buyers under 36 purchasing their first home, minimum amount for disabled family members, dwelling of a parent living with children
ITP allowance 100 % 100 % on the tax liability for the first 270,151.20 €, surplus taxed at 8 % under-30s and people with disability of 33 % or more, subject to further conditions
IVA 10 % New-build residential property incl. up to 2 parking spaces
IVA 21 % Commercial property / land owned by companies
AJD general rate 1,5 % Notarial deeds (incl. new-build purchase, mortgage)
AJD reduced rate 1 % First main residence, value up to 270,151.20 €
AJD super-reduced rate 0.5 % on the first 270,151.20 €, surplus taxed at 1.5 % Under-36s, disability, large families and single-parent families
AJD 100 % rebate 100 % on the tax liability of the first 270,151.20 €, surplus taxed at 1.5 % under-30s and people with disability of 33 % or more (Ley 4/2026)

Example calculation for a resale property worth 500,000 €:The first 400,000 € are subject to 8 % ITP (32,000 €), and the remaining 100,000 € (400,001–500,000 €) to 9 % ITP (9,000 €). This results in a total ITP burden of 41,000 € – no AJD applies here, as ITP and AJD generally exclude each other for resale properties.

Procedure: How and when is the AJD paid?

  1. Notarial execution of the purchase deed (escritura) or mortgage before a notary of your choice on Mallorca.
  2. Determination of the tax base based on the value stated in the deed.
  3. Calculation of the AJD based on the rate applicable in the Balearic Islands by the notary, gestor or tax advisor.
  4. Self-assessment and payment of the tax to the relevant Balearic tax authority (ATIB).
  5. Submission of the payment confirmation to the Land Registry (Registro de la Propiedad) for registration.

Note:As deadlines and procedural details can vary depending on the notary's office and municipality, you should coordinate with your lawyer or gestor well before signing the contract to ensure the payment is made on time.

Most common mistakes when dealing with the AJD

  • Buyers confuse AJD with ITP and miscalculate the additional costs, assuming both taxes always apply in parallel.
  • For new-build purchases, the additional AJD alongside the IVA is often forgotten in the financing plan.
  • When a mortgage is taken out at the same time, it is overlooked that the AJD on the mortgage deed is a separate item alongside the AJD on the purchase deed.
  • Tax rates are taken uncritically from outdated sources, even though rates and allowances can change.

What comes next?

After payment of the AJD and registration in the Land Registry, the tax side of the property purchase is not yet complete: as an owner in Mallorca, further recurring charges apply, such as the annual property tax IBI. Anyone wishing to let the property should also look into the tax obligations on rental income as a non-resident. And when it comes to a later sale, other taxes become relevant again.

Checklist: AJD when buying property in Mallorca

  • Clarify the type of property: new build (IVA + AJD) or resale property (ITP)?
  • Agree the assessment basis of the deed with the notary/lawyer
  • Verify the current AJD rate for the Balearics with ATIB or a tax adviser
  • If taking out a mortgage, factor in the additional AJD on the mortgage deed
  • Clarify deadlines for self-assessment and payment with a gestor
  • Have proof of payment ready before registration in the Land Registry
  • Have the total additional costs (ITP/IVA, AJD, notary, Land Registry, lawyer) calculated in writing before signing the contract

Conclusion

In Mallorca, the AJD is no minor side issue but an independent cost factor that arises in addition to the IVA, especially when buying a new build and with every mortgage arrangement. Anyone who clearly distinguishes between ITP, IVA and AJD and works through the rates early on with a notary, lawyer and tax adviser avoids nasty surprises in the final settlement. Especially with larger purchase sums or combined new-build/mortgage constellations, it is worth having an individual, written calculation drawn up before signing the contract.

Official sources

  • Agencia Tributaria de las Illes Balears (ATIB) – the tax authority responsible for ITP/AJD in the Balearics: https://www.atib.es
  • Agencia Estatal de Administración Tributaria (AEAT) – Spain's state tax authority: https://www.agenciatributaria.es
  • Boletín Oficial del Estado (BOE) – the official publication for Spanish tax laws, including the Ley del ITPAJD: https://www.boe.es

Further reading on mallorca.com: Buying property in Mallorca, Taxes & law, IBI tax Spain, Foreign buyers in Mallorca, Checking the Land Registry in Spain

What does AJD stand for in Spanish?
AJD stands for Actos Jurídicos Documentados, which translates roughly as "tax on documented legal acts". It taxes certain notarised transactions that are recorded in the Land Registry.
Does AJD also apply when buying a resale property?
Generally not: resale properties are usually subject to ITP, and ITP and AJD mutually exclude each other in the classic resale scenario.
How high is AJD in the Balearics?
The general rate is 1.5 % of the deed value. For a first main residence up to 270,151.20 euros, the rate is 1 %; for those under 36, people with disabilities, and large or single-parent families, it is 0.5 % on the first 270,151.20 euros. For those under 30 and people with a disability rating of 33 % or higher, a 100 % rebate may apply under further conditions.
Does AJD apply in addition to IVA when buying a new-build?
Yes, when buying a new-build property for first occupation, AJD is levied on the purchase deed in addition to IVA (10 % for residential properties, 21 % for commercial properties/land sold by companies).
Is AJD also due when setting up a mortgage?
Yes, the notarised deed and Land Registry entry for a mortgage counts as a separate documented legal act, on which AJD may also be charged — independently of the tax regime applying to the property purchase itself.
Who calculates and pays the AJD during the purchase process?
Typically, the notary, gestor or tax advisor determines the taxable base from the deed; the self-assessment and payment are made with the relevant Balearic tax authority before the Land Registry entry is completed.
Is there a reduced tax rate for main residences in Mallorca?
Yes, and since Ley 4/2026 it works as a **cap** rather than an all-or-nothing threshold. The favourable rate applies to the first 270,151.20 euros of the taxable base, with the portion above that taxed at the general rate of 8 percent. A buyer under 36 who purchases their first home for 325,000 euros would therefore pay 2 percent on 270,151.20 euros and 8 percent on the remaining 54,848.80 euros — a total of 9,790.92 euros instead of 26,000 euros at the general rate. Whether the entitlement applies at all, however, depends on the island's value threshold: 331,859.70 euros in Mallorca and Menorca, 378,211.68 euros in Ibiza and Formentera.
Do ITP and IVA always exclude each other when buying property?
Yes, according to standard practice, property transfer tax (ITP) and VAT (IVA) are never charged simultaneously when buying property — depending on the type of property, either one tax or the other applies.