Furniture in the purchase contract: how the furniture share reduces ITP in Mallorca

Anyone buying a furnished flat, villa or finca in Mallorca generally only pays the property transfer tax ITP (Impuesto de Transmisiones Patrimoniales) on the value of the property itself – not on movable goods such as furniture, kitchen appliances or decorative items. If a separate, realistically valued furniture share is stated in the purchase contract, the tax base is reduced accordingly, and the ITP due is lower. In this guide you'll learn how this separation works in a legally secure way, what evidence the notary and tax office expect, where practice sets limits, and which mistakes buyers repeatedly make – including a checklist for your own purchase contract discussion.

Are you planning to buy a property with furniture in Mallorca and want to calculate the tax burden correctly?

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• ITP Balearic Islands 2026: All current rates

What is the furniture share in the purchase contract – and why is it worthwhile?

When buying property in Mallorca, the ITP is levied on the property value specified in the purchase contract (Escritura de Compraventa). Movable goods – i.e. everything not permanently connected to the building – are generally not subject to this tax in the same way as the property itself. If a furnished flat is sold, the purchase price can therefore be split into two items: the value of the property (subject to ITP) and the value of the furniture (not subject to it in the same form). The higher the documented furniture share, the lower the tax base for the property transfer tax – provided the value is realistic and verifiable.

Note: This separation is common practice in Spain, but does not replace individual tax advice. The specific arrangement should always be worked out together with a notary and tax advisor.

Movable goods vs. property: What counts as furniture?

Not everything found in the house automatically counts as "movable". What matters is whether an item is permanently connected to the property (fixtures, installations) or whether it can be removed without structural intervention.

Attention:Depending on the individual case, the classification can be disputed. In case of doubt, what matters is whether an item can be removed without damaging the fabric of the property.

How ITP is generally calculated in Mallorca

ITP is levied in the Balearics by the relevant tax authority and is based on the value stated in the purchase contract or the tax value applicable to the property. The exact, currently valid tax rates and scales for 2026 can be found in our pillar article on ITP in the Balearics. Important for this topic: only the property portion of the purchase price is included in this calculation – the separately stated and documented furniture portion is excluded, thereby reducing the tax base.

For the overall calculation of your purchase, it's worth taking a look at our overview of purchase ancillary costs in Mallorca as well as the stamp duty AJD, which may also apply in certain contract arrangements.

Reductions and exemptions: Who benefits from a further reduction in ITP

Regardless of the furniture portion, the Balearic government has introduced targeted relief on ITP for certain groups of buyers in recent years. These rules apply to the purchase of a first home and can be combined with the furniture portion to further reduce the tax burden.

Note: These reductions were agreed as part of the government programme under President Marga Prohens. Whether and to what exact extent they apply in a given tax year should be verified for your specific case with the competent tax authority or your tax adviser. You can find an overview of further first-time buyer schemes at Purchase assistance for first-time buyers in the Balearics.

How to agree the furniture share in a legally secure way

1. Draw up an inventory list. Seller and buyer jointly record which movable items are included in the purchase price – item by item, with individual values.
2. Apply a realistic valuation. The value should correspond to the actual market value of the used furniture, not its price when new.
3. Collect supporting documents. Invoices, purchase receipts or an independent valuation report support the amounts stated.
4. Record the separation in the purchase contract. The notary includes the property value and the furniture share as separate items in the escritura or an annex to it.
5. Involve a tax adviser. Before signing, a professional checks whether the allocation is plausible and can be documented.
6. Adjust the reservation agreement. If a reservation agreement already exists, the planned allocation should already be indicated there, in order to avoid later discrepancies.

Documentation: invoices, inventory list, valuation report

The credibility of the furniture share depends almost entirely on the quality of the evidence. The better documented it is, the lower the risk of a later challenge.

Note: Without verifiable evidence, there is a risk that the tax authority will not recognise the assigned furniture value and will demand the full ITP on the total purchase price.

Role of the notary and land registry

The notary is responsible for ensuring that the values stated in the purchase contract are plausible and formulated in a legally sound manner. While they do not provide detailed tax advice, they do ensure that the separation of property value and furniture value is clearly documented and that both parties understand the consequences. You can find out more about the process at the notary appointment in our article on Notary for property purchases in Spain. Only the property value is entered in the land registry (Registro de la Propiedad) – movable goods are not subject to land registry entry. We explain how to check the land registry extract before purchase under Checking the land registry in Spain.

Limits and risks: when the tax office takes a closer look

The separation of property and furniture is legal and common practice in Spain – but it is not a free pass for arbitrarily high furniture values. If buyers and sellers set a disproportionately high furniture share in order to artificially reduce the ITP, the tax authority can question this approach and reassess the taxable value of the property. In parallel, the authority in any case checks the so-called reference value (Valor de Referencia) for property transactions – more on this in our article on Valor de Referencia in Spain. If the property value stated in the contract is significantly below this reference value, this can lead to additional tax demands regardless of the furniture share.

Note: There is no uniformly fixed maximum rate for the furniture share. As a rule of thumb: the value must be demonstrably derived from actual acquisition costs or a plausible market value for used furniture.

Most common mistakes

• Unrealistically high furniture value without supporting evidence. This almost always leads to queries from the tax authorities.
• No written inventory list. Without a list, it cannot later be verified what actually belonged to the furnishings.
• Fixed built-in elements wrongly declared as furniture. Fitted kitchens or sanitary installations are, for tax purposes, part of the property.
• Tax advisor only brought in after signing. Corrections after the fact are considerably more effort than clean planning beforehand.
• Neglecting the Valor de Referencia. A property value set too low can be challenged regardless of the furniture share.

What happens next? After signing

After the notarial deed is executed, the Escritura is registered with the Land Registry (Registro de la Propiedad), and the ITP due must be paid to the tax authority within the statutory deadline. Keep all supporting documents relating to the furniture share – inventory list, invoices, and if applicable the valuation report – for the duration of any possible future audits. Clean documentation is also valuable for a later asset statement or a future resale. The further legal process after signing is described in our article on Property purchase: process.

Checklist: furniture share in the purchase contract

• Inventory list with individual values drawn up
• Invoices or purchase receipts for high-value furniture items available
• Independent valuation report obtained for a larger furniture value
• Furniture share set realistically in relation to the total purchase price
• Separation of property value and furniture value documented in the purchase contract/Escritura
• Valor de Referencia of the property compared with the assumed property value
• Tax advisor consulted before signing
• Possible reductions for young buyers or families checked

Conclusion

The furniture share in the purchase contract is a legitimate and well-established means in Spain of reducing the ITP assessment basis when buying property in Mallorca – provided the split is realistic, well documented, and cleanly incorporated into the purchase contract together with the notary and tax advisor. Anyone who additionally belongs to the group of young buyers or families with several children can benefit from further reductions and reduce the tax burden even more significantly. What remains decisive: evidence, evidence, evidence – without traceable documentation, a legal tax structuring arrangement can quickly turn into a dispute with the tax authorities.

Official sources

• Agencia Tributaria de las Illes Balears (ATIB) – responsible for administering the ITP in the Balearic Islands: https://www.atib.es
• Boletín Oficial del Estado (BOE) – publication body for tax law regulations: https://www.boe.es
• Agencia Estatal de Administración Tributaria (AEAT) – state tax administration: https://sede.agenciatributaria.gob.es
• Consell de Mallorca – administrative authority of the island of Mallorca: https://www.conselldemallorca.cat