Selling an Inherited Property in Mallorca: Process, Taxes, Pitfalls

Selling an inherited property in Mallorca is legally a two-stage process: first, the inheritance must be accepted, taxed and registered in the Land Registry in Spain – only then can a valid sale actually take place. Anyone who reverses or underestimates this order loses valuable time, because a buyer relying on financing will not complete without registered ownership. This guide shows you which steps must be completed before the notary appointment, how inheritance tax on the Balearics works since the 2025 reform, why the plusvalía municipal can hit inherited properties twice over, what the 3% withholding for non-resident sellers is all about, and which pitfalls – from unregistered structures to a community of heirs – most often hold up the sale process in practice.

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Why the order matters

Many heirs think of selling first and only then consider the Spanish inheritance procedure. This is a mistake with consequences: as long as the inheritance has not been formalised by a notarial escritura de aceptación y adjudicación de herencia and the heir has not been registered as the new owner in the Registro de la Propiedad, there is legally no seller capable of selling yet. A buyer financing the property will not be able to complete without this registration in any case – the bank requires a clean, gap-free Land Registry record. How to generally check a Spanish Land Registry record is explained in the guide Checking the Spanish Land Registry.

The correct order is therefore: obtain the documents, accept the inheritance, declare the taxes, have it registered in the Land Registry – only then sell.

Step by step: from the death to registered ownership

Before a buyer can even be considered, several documents and procedural steps must be in place. The table below shows the most important evidence required.

Note: Which law of succession applies to your estate is determined, under the EU Succession Regulation (Regulation (EU) No 650/2012), in principle by the law of the state of the deceased's last habitual residence. A choice of law in favour of one's own national law is possible, but must be expressly made in the will. Which law applies in a specific case can only be assessed individually – have this confirmed by a lawyer before making any plans.

Inheritance tax in the Balearics: what the 2025 reform changed

The Balearic inheritance tax (ISD) was significantly changed for acquisitions upon death with tax liability arising on or after 25 July 2025. Importantly, there is a clarification that many portals get wrong: these are reductions applied to the tax liability, not tax rates.

Caution: At the time of research, the ATIB content page "Familiar que recibe una herencia" still listed the old figures of 50% and 25%. What is authoritative is the dated Novedad on the legal amendment as well as Art. 36 bis Decreto Legislativo 1/2014 – not an undated overview page. If in doubt, have the current status confirmed in writing by ATIB or a tax adviser.

For details on allowances, tax brackets and deadlines for the ISD return, see the guides Inheritance & Gift Tax Balearics and, specifically for siblings and more distant relatives, Inheritance Tax Balearics: Siblings.

Plusvalía municipal: the tax that hits twice

The municipal capital gains tax (plusvalía municipal, IIVTNU) is particularly tricky for inherited properties because in practice it can arise twice: once at the time of inheritance itself, and a second time upon a later sale. The legal basis is the Texto refundido de la Ley Reguladora de las Haciendas Locales (Real Decreto Legislativo 2/2004).

It's precisely this last rule that explains why buyers often withhold an amount for the plusvalía at the notary appointment when the seller doesn't reside in Spain – this isn't arbitrary, it's the law.

However, there are two exceptions that apply more often on Mallorca than many heirs assume:

Note: What matters for the first exception is solely the cadastral IBI classification as suelo rústico – not the visual impression of a finca on site. With the second exception, the tax exemption does not apply automatically; you must actively declare it and support it with the acquisition and disposal deeds. For buildings, the proportion of the cadastral land value relative to the total cadastral value is used for this purpose. The increase in value itself is also calculated over a maximum of twenty years (Art. 107.1 TRLRHL).

The specific rates and coefficients are set by each municipality in its own Ordenanza fiscal and updated annually – so ask the relevant town hall directly for the current value applicable to your property. You can find an overview of how the tax works in the guide Plusvalía Municipal.

The sale itself: 3% withholding for non-resident heirs

Once the property is registered and sold, most German heirs are subject to a further rule of the Spanish tax administration (AEAT): the 3% withholding.

Note: The withholding also applies if you make use of a reinvestment exemption – Modelo 211 and Modelo 210 H must still be filed. More on the refund is explained in the guide 3% withholding: refund. An overview of the taxes involved in the sale overall is provided by Taxes on property sales in Spain.

Several co-heirs: selling together, bundling one power of attorney

With inherited properties on Mallorca, it is the rule rather than the exception that several people inherit jointly. In this case, the community of heirs sells the property together – no one can dispose of their notional share alone without the other co-heirs agreeing or the property being physically divided.

In practice, the community of heirs usually authorises one person on site to accompany the entire sales process and sign at the notary's office. A power of attorney issued in Germany must generally be notarised and provided with an apostille for this purpose – you should clarify the exact form in advance with the Spanish notary who will certify the escritura. You can find details on the process in the guide Power of attorney Spain notary.

Pitfalls that actually hold up the sale

Even if inheritance tax and plusvalía are correctly declared, in practice sales of inherited properties often fail due to entirely different issues:

• Unregistered structures: An extension built at a later date, a pool or a pool house that does not appear in the Land Registry will come to light at the latest during the buyer's due diligence or the bank's financing enquiry.
• Discrepancies between the Land Registry and the Cadastre: Differences in area or boundary lines must be clarified before the notary appointment.
• Existing encumbrances: A mortgage of the deceased that has not yet been cancelled, a usufruct (usufructo) held by the surviving spouse, or rights of way (servidumbres) on the property must be disclosed and settled.
• Outstanding running costs: Arrears on IBI, Comunidad de Propietarios fees or the rubbish collection charge. Buyers usually require a certificate from the owners' association confirming there are no outstanding debts.
• Missing energy performance certificate: The technical documents that must be presented at the sale should be commissioned early so that they are available at the notary appointment.

The most common mistakes when selling an inherited property

• Initiating a sale before registration in the Land Registry: A reservation agreement can be prepared in advance, but a valid sale can only be concluded once ownership has been registered.
• Overlooking the second plusvalía: Heirs often only budget for the tax arising from the inheritance and forget that a further plusvalía liability can arise upon sale.
• Confusing the relief with the tax rate: 60% or 35% are reductions applied to the tax owed, not tax rates – anyone who confuses the two will calculate incorrectly.
• Taking outdated ATIB overview pages at face value: Where there is a conflict between an undated overview page and a dated legislative change, the latter takes precedence.
• Regarding the 3% withholding as an arbitrary decision by the buyer: It is a statutory requirement and cannot be negotiated away, though it can potentially be reclaimed via Modelo 210 H.
• Failing to arrange a power of attorney for the community of heirs: Without a clearly authorised contact person on the ground, every notary appointment is delayed.

What happens next?

Following the notary appointment, non-residents generally have to file further declarations: the offsetting or refund of the 3% withholding via Modelo 210, where applicable the final settlement of the plusvalía municipal with the local council and – depending on the country of residence – the question of how the sale proceeds are to be treated for tax purposes in Germany. Anyone who would prefer to rent out the property initially rather than sell it straight away will find the basics in the Renting out section. For the general process of selling on Mallorca, it is also worth taking a look at Selling property in Mallorca.

Checklist: selling an inherited property on Mallorca

1. Obtain the death certificate, the Certificado de Últimas Voluntades and the Certificado de Contratos de Seguros de Cobertura de Fallecimiento.
2. Have the will or the statutory order of succession clarified, and apply for a European Certificate of Succession if applicable.
3. Have the escritura de aceptación y adjudicación de herencia notarised by a Spanish notary.
4. Apply for a NIE for each heir, if not already obtained.
5. Submit the ISD declaration to the ATIB and the plusvalía declaration to the relevant local council.
6. Wait for and confirm registration in the Registro de la Propiedad.
7. With several co-heirs: arrange a power of attorney for a local point of contact together with the notary.
8. Have the property checked for unregistered buildings, encumbrances and outstanding running costs.
9. Obtain an energy performance certificate and other technical documentation required for the sale.
10. Only then: start the sales process, if necessary with the support of a estate agent in Mallorca.

Conclusion

Selling an inherited property in Mallorca is not a one-step process, but necessarily follows the complete handling of the inheritance in Spain: acceptance before the notary, taxation with ATIB and the local council, and registration in the Land Registry. Only afterwards can a buyer be found and a valid purchase contract notarised. Anyone who correctly understands the allowances of Balearic inheritance tax, plans for the double plusvalía liability, and treats the 3% withholding as a legally required but creditable amount will avoid the biggest delays. Where there are several co-heirs, it is worth arranging a clear power of attorney early on – and specialised local support is invaluable at every single step.

Official sources

• Texto refundido de la Ley Reguladora de las Haciendas Locales (Real Decreto Legislativo 2/2004), consolidated version: https://www.boe.es/buscar/act.php?id=BOE-A-2004-4214
• ATIB, update on the change to inheritance tax allowances: https://atib.es/General/Novedad.aspx?idTipoTexto=1&idTexto=16326&lang=es
• ATIB, information page on inheritance tax: https://www.atib.es/TA/contenido.aspx?Id=9855&lang=es
• Agencia Tributaria (AEAT) – taxation of non-residents, Modelo 211/Modelo 210 (no verifiable address, therefore listed without a link)
• Ministerio de Justicia – Certificado de Últimas Voluntades and Certificado de Contratos de Seguros de Cobertura de Fallecimiento (no verifiable address, therefore listed without a link)
• EU Succession Regulation (Regulation (EU) No. 650/2012) (no verifiable address, therefore listed without a link)
• Registro de la Propiedad (no verifiable address, therefore listed without a link)