Selling an inherited property in Mallorca: process, taxes and pitfalls

Selling an inherited property in Mallorca is a two-stage legal process: the inheritance must first be accepted in Spain, the relevant taxes paid and the new ownership registered at the Land Registry. Only then can the property be legally sold. Getting this sequence wrong, or underestimating the time it takes, can cause costly delays: a buyer relying on a mortgage cannot complete without the seller’s ownership being registered. This guide explains what must be done before the notary appointment, how inheritance tax in the Balearic Islands works following the 2025 reform, why the plusvalía municipal may be payable twice on an inherited property, what the 3% withholding means for non-resident sellers, and which pitfalls – from unregistered buildings to disagreements among co-heirs – most often hold up a sale in practice.

• Find a German-speaking lawyer in Mallorca — for accepting the inheritance and handling the notarial process locally

Why the order matters

Many heirs think about selling first and dealing with the Spanish inheritance formalities later. That is a mistake with consequences: until the inheritance has been formalised through a notarised escritura de aceptación y adjudicación de herencia and the heir has been registered as the new owner in the Registro de la Propiedad, there is no owner legally able to sell the property. A buyer financing the purchase cannot complete without that registration in any event – the bank will require a clear chain of title in the Land Registry. Our guide to checking the Spanish Land Registry explains the basics.

The correct order is therefore: obtain the documents, accept the inheritance, file the tax returns, register the new ownership at the Land Registry – and only then sell.

Step by step: From the death to registered ownership

Before looking for a buyer, you need to obtain several documents and complete a number of formalities. The following table sets out the key documents.

Note: Under the EU Succession Regulation (Regulation (EU) No 650/2012), the law governing your estate is generally that of the country where the deceased was last habitually resident. You can choose the law of your nationality instead, but you must have done so expressly in your will. Which law applies in a particular case requires individual assessment – have a lawyer confirm it before making plans.

Inheritance tax in the Balearic Islands: what the 2025 reform changed

The 100% tax relief for spouses, children and parents (Groups I and II) has applied in the Balearic Islands since 18 July 2023. Ley 6/2025 revised the rules for tax liabilities arising from 25 July 2025: Group III now receives greater relief, and the wording for Groups I and II is no longer limited to people subject to unlimited tax liability in Spain. One important clarification that many websites get wrong: these are reductions in the tax due, not tax rates.

Please note: At the time of research, the ATIB information page "Familiar que recibe una herencia" still showed the old figures of 50% and 25%. The authoritative sources are the dated Novedad notice about the legislative change and Art. 36 bis Decreto Legislativo 1/2014 – not an undated overview page. If in doubt, ask the ATIB or a tax adviser to confirm the current position in writing.

For details of allowances, tax bands and deadlines for filing the ISD return, see the guides Inheritance & gifts in the Balearic Islands and, specifically for siblings and more distant relatives, Inheritance tax in the Balearic Islands: siblings.

Plusvalía municipal: the tax that hits twice

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

This last rule explains why buyers often withhold an amount for plusvalía at the notary appointment if the seller does not live in Spain – it is a legal requirement, not an arbitrary demand.

There are, however, two exceptions that apply on Mallorca more often than many heirs realise:

Note: For the first exception, only the cadastral classification as suelo rústico for IBI purposes matters – not what a finca looks like on the ground. The second exception does not apply automatically; you must claim it and provide the acquisition and sale deeds as evidence. For buildings, the proportion of the total cadastral value attributable to the land is used. The increase in value is also calculated over a maximum of twenty years (Art. 107.1 TRLRHL).

Each municipality sets the applicable tax rates and coefficients in its own Ordenanza fiscal and updates them annually – so ask the relevant town hall directly for the current figures for your property. For an overview of how the tax works, see the guide Plusvalía Municipal.

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

Once the property has been registered and is sold, another rule of the Spanish tax authority (AEAT) applies to most German heirs: the 3% withholding.

Important: The withholding also applies if you claim a reinvestment exemption – Modelo 211 and Modelo 210 H must still be filed. The guide 3% withholding: claiming a refund explains more about refunds. For an overview of the taxes involved in selling, see Taxes on selling property in Spain.

Multiple co-heirs: sell together, appoint one representative

For inherited properties on Mallorca, it is the rule rather than the exception for several people to inherit together. In this case, the co-heirs sell the property jointly – no one can dispose of their undivided share alone without the other co-heirs’ consent or a physical division of the property.

In practice, the co-heirs usually authorise one person locally to handle the entire sale process and sign before the notary. A power of attorney granted in Germany generally needs to be notarised and apostilled for this purpose – you should agree on the exact form in advance with the Spanish notary who will formalise the escritura. You can find details of the process in the guide Power of attorney for a Spanish notary.

Pitfalls that can actually hold up a sale

Even when inheritance tax and plusvalía have been declared correctly, sales of inherited properties often run into entirely different problems in practice:

• Unregistered structures: An extension, pool or pool house added later but not recorded in the Land Registry will come to light during the buyer’s checks or the bank’s mortgage assessment.
• Discrepancies between the Land Registry and the cadastre: Differences in floor area or property boundaries must be resolved before the notary appointment.
• Existing charges and rights: An outstanding mortgage held by the deceased, a surviving spouse’s right of usufruct (usufructo), or rights of way (servidumbres) over the property must be disclosed and dealt with.
• Unpaid ongoing costs: Arrears of IBI, homeowners’ association fees or waste collection charges. Buyers usually require a certificate from the homeowners’ association confirming that no fees are outstanding.
• Missing energy performance certificate: The technical certificates required for the sale should be arranged early so they are available at the notary appointment.

The most common mistakes when selling an inherited property

• Starting the sale before title is registered: A reservation agreement can be prepared, but the sale cannot be legally completed until ownership has been registered.
• Overlooking the second plusvalía liability: Heirs often budget only for the tax arising from the inheritance and forget that a further plusvalía liability may arise on the sale.
• Confusing a tax reduction with a tax rate: 60% and 35% are reductions in the tax due, not tax rates – confusing the two leads to incorrect calculations.
• Taking outdated ATIB overview pages at face value: If an undated information page conflicts with a dated change in the law, the latter takes precedence.
• Thinking the buyer can choose whether to withhold 3%: The withholding is required by law and cannot be negotiated away; at most, it can be reclaimed through Modelo 210 H.
• Failing to arrange a power of attorney for the group of heirs: Without a clearly authorised local representative, every notary appointment is delayed.

What happens next?

After the notary appointment, non-residents generally have further tax matters to deal with: offsetting or reclaiming the 3% withholding through Modelo 210, resolving any outstanding plusvalía municipal matters with the local council and – depending on their country of residence – determining how the sale proceeds are taxed in Germany. Anyone who would prefer to rent out the property initially rather than sell it straight away can find the basics in the Renting out property section. For an overview of the property sale process on Mallorca, see also Selling a property on Mallorca.

Checklist: Selling an inherited property in Mallorca

1. Obtain the death certificate, Certificado de Últimas Voluntades and Certificado de Contratos de Seguros de Cobertura de Fallecimiento.
2. Have the will or the rules of intestate succession clarified and, if necessary, apply for a European Certificate of Succession.
3. Have the Escritura de aceptación y adjudicación de herencia notarised by a Spanish notary.
4. Apply for an NIE for each heir who does not already have one.
5. Submit the ISD tax return to ATIB and the plusvalía declaration to the relevant municipality.
6. Wait for registration in the Registro de la Propiedad and obtain confirmation.
7. If there are several co-heirs, agree a power of attorney for a local representative with the notary.
8. Have the property checked for unregistered structures, charges and outstanding utility bills.
9. Obtain an energy performance certificate and any other technical documents needed for the sale.
10. Only then start the sales process, if necessary with the help of a real estate agent in Mallorca.

Conclusion

Selling an inherited property in Mallorca is not a single-step process. The inheritance must first be fully settled in Spain: accepted before a notary, declared for tax purposes to ATIB and the municipality, and registered in the land register. Only then can you find a buyer and have a valid sale contract notarised. Understanding how the Balearic inheritance tax relief applies, allowing for the two separate plusvalía obligations and recognising the 3% withholding as a legally required amount that can be credited against tax will help avoid the biggest delays. Where there are several co-heirs, it is worth arranging a clear power of attorney early on. Specialist local support is invaluable at every 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 changes to inheritance tax relief: https://atib.es/General/Novedad.aspx?idTipoTexto=1&idTexto=16326&lang=es
• ATIB, inheritance tax information page: https://www.atib.es/TA/contenido.aspx?Id=9855&lang=es
• Agencia Tributaria (AEAT) – taxation of non-residents, Modelo 211/Modelo 210 (no verified URL available, so listed without a link)
• Ministerio de Justicia – Certificado de Últimas Voluntades and Certificado de Contratos de Seguros de Cobertura de Fallecimiento (no verified URL available, so listed without a link)
• EU Succession Regulation (VO (EU) Nr. 650/2012) (no verified URL available, so listed without a link)
• Registro de la Propiedad (no verified URL available, so listed without a link)

Where is the sale entered on the Spanish income tax return?

If you are tax-resident in Spain, enter the sale of the inherited property on your Spanish income tax return (IRPF) under “Ganancias y pérdidas patrimoniales” – gains and losses from transfers of assets. You report the sale, not the inheritance again.

For the 2025 tax year (return filed in 2026), identify the property in Renta Web and mark the sale as a transfer for consideration. Enter the sale value in field 1826 and the acquisition value in field 1830. The starting point for the acquisition value of an inherited property is the value declared for inheritance tax; which documented costs can also be included depends on the circumstances. Field numbers may change in other tax years.

If you are not tax-resident in Spain, the Spanish IRPF return is not the correct route. Instead, the sale is reported using the non-resident return, Modelo 210. Whether you must also file a return in your country of residence needs to be assessed separately.

Not legal or tax advice.