Balearic Islands or Costa Blanca? The rules side by side
The Balearic Islands and the Costa Blanca are both popular with non-resident buyers, but each region sets its own transfer tax, letting rules and inheritance and wealth tax reliefs. This table sets the two books side by side. The Balearics book reflects rules in force in September 2026, the Costa Blanca book rules in force in October 2026.
| Topic | Balearic Islands | Costa Blanca |
|---|---|---|
| Transfer tax on a resale home (ITP) | Banded: 8% up to €400,000, 9% to €600,000, 10% to €1m, 12% to €2m, 13% above. Charged on the higher of price and reference value. | 9% of the whole value up to €1,000,000 (10% before 1 June 2026); 11% of the whole value above that. Same reference value rule. |
| New build: VAT and stamp duty (AJD) | 10% VAT plus 1.5% stamp duty; 2% stamp duty if the property is worth €1,000,000 or more. | 10% VAT plus 1.4% stamp duty (1.5% before 1 June 2026). |
| Buying costs in the book's worked example | €750,000 resale home: €65,918 in taxes and notary and registry fees, about 8.8% of the price, before the lawyer's fee. Budget around 10%. | €450,000 resale villa: €41,207 in taxes and notary and registry fees, about 9.2% of the price, before the lawyer's fee. Budget around 10% (new build 12–13%). |
| Typical asking prices per m² | Fotocasa, March 2026: from €2,925 in Inca and €3,486 in Maó to €7,665 in Ibiza town and €8,693 in Santa Eulària des Riu. | idealista, May 2026: from €2,548 in Torrevieja to €4,072 in Jávea; provincial average €2,811. |
| Tourist tax | Ecotasa collected from guests: €2.20 per guest per night from 1 May to 31 October, €0.55 in low season; under-16s exempt. | None. A regional tax approved in 2022 was repealed in November 2023 before it took effect. |
| Holiday letting of flats and houses | No new licences for flats; Palma accepts no new holiday lets in homes. A house needs a licence, suitable zoning and tourist places. | Town hall report and five-year registration needed; flats need approval of three-fifths of owners. Alicante city, Dénia, Jávea and others suspend or cap new lets. |
| Wealth tax allowance for non-residents | €3,000,000 under Balearic rules, only if you file form 714; otherwise the national €700,000. | Plan on €1,000,000 under Valencian rules, only if you file form 714. Whether non-residents get the €2,000,000 from July 2026 law is unsettled. |
| Inheritance tax: children | 100% relief for children, spouses and parents, including heirs abroad: €0 on a €750,000 home. | €100,000 allowance and 99% reduction for children, grandchildren, spouses and parents, including heirs abroad: about €686 on a €450,000 villa. |
| Inheritance tax: brothers, sisters, nephews (group III) | 60% relief (35% if inheriting alongside the deceased's children). Brother inheriting €750,000: about €92,800. | 25% reduction for deaths from 1 June 2026, 50% from 1 June 2027. Brother inheriting €450,000: about €112,300 (about €74,900 from June 2027). |
| Military permit (non-EU buyers) | Needed for rural land anywhere in the islands; not normally for homes on urban land. | Needed only for rural land in Torrevieja, Orihuela, Pilar de la Horadada and San Miguel de Salinas; since July 2021 not for urban land (lawyer to confirm per plot). |
| Unlicensed work on rural land | Protected rural land: no time limit. Ordinary rural land: eight years. Legalisation windows close in 2028 (Mallorca February, Menorca March, Ibiza April). | No time limit on ordinary rural land since February 2019, none on protected land. Many homes completed before 20 August 2014 can be regularised. |
| Countries in the country annex | Germany, United Kingdom, Italy, France, Sweden, Netherlands. | United Kingdom, Netherlands, Belgium, Poland, Germany, Sweden, Norway. |
Good to know
- In both regions non-resident owners pay notional income tax of 1.1% or 2% of the cadastral value, at 19% (EU/EEA) or 24% (others), even if the home is never let.
- In both regions the buyer keeps back 3% of the price when the seller is non-resident, and gains on sale are taxed at 19%.
- Prices are property portal asking prices (Fotocasa for the Balearics, idealista for the Costa Blanca), for comparison only. The percentages in the worked-example row are calculated from the books' figures.
- Banks typically lend non-residents 60–70% (EU) or 50–60% (non-EU) in both regions; the Costa Blanca book advises 50–60% own funds for buyers from outside the EU.
- Rules change often in both regions; check the current position before you act.
Which suits whom
On the books' figures, the Balearics combine higher asking prices, a banded transfer tax and a €3m wealth tax allowance with holiday letting largely limited to houses that already hold a licence, which suits buyers with larger budgets who mainly want the home for their own use or can pay for a licensed house. The Costa Blanca has lower asking prices, a flat 9% transfer tax up to €1m and no tourist tax, with letting decided town by town, which suits buyers on smaller budgets or those who want to let where the town still allows it. Heirs who are brothers, sisters, nephews or nieces generally receive larger reliefs under the Balearic rules (60%, or 35% alongside the deceased's children) than under the Valencian ones (25%, rising to 50% for deaths from June 2027).
Try your own figures in the free calculators for the Balearic Islands and the Costa Blanca.
Buying a Home in the Balearic Islands as a Non-Resident (2026–27 edition) covers the whole process, from the first offer to who inherits, with worked examples and deadlines.
Buying a Home on the Costa Blanca as a Non-Resident (2026–27 edition) covers the whole process, from the first offer to who inherits, with worked examples and deadlines.
General information based on the rules described in each 2026–27 edition (Balearic Islands: September 2026; Costa Blanca: October 2026), not legal or tax advice.