Modelo 210 Guide
Plusvalía Municipal: Capital Gains Tax on Land When Selling a Property in Mallorca
Sold a property in Mallorca? Here's how the Plusvalía municipal works for non-residents — with calculation methods, distinction from Modelo 210/211, and a worked example.
Do you need to file Modelo 210?
Plusvalía Municipal — The Short Answer
When selling a property in Mallorca, in addition to Spanish capital gains tax (via Modelo 210/211), a further, independent tax often applies: the Plusvalía municipal (officially IIVTNU — Impuesto sobre el Incremento de Valor de los Terrenos de Naturaleza Urbana). This local tax captures only the increase in the value of the land (not the building) since the last change of ownership. Important for non-residents: for a sale by a non-Spain-resident individual, the buyer becomes the sustituto del contribuyente for tax purposes — meaning the payment obligation towards the municipality effectively shifts to the buyer's side.
What Is Taxed — and What Isn't?
The Plusvalía only taxes the value of the land, not the value of the building. The taxable base is derived from the land's share of the cadastral value shown on the IBI bill.
Important rule since the 2021 reform: if, under the statutory comparison rules, there is no actual increase in the value of the land, the transaction is not subject to tax. For built properties, the change in value is apportioned to the land accordingly. The absence of an increase in value must be declared and evidenced with the acquisition and sale deeds. This is an explicit non-liability to tax, not merely an exemption.
Two Calculation Methods
Following the 2021 ruling of the Spanish Constitutional Court, there are two alternative calculation methods:
1. Objective Method (método objetivo)
The land value derived from the cadastral value is multiplied by a legally set coefficient, which depends on the length of ownership.
Formula: Land value × coefficient (based on holding period) × municipal rate = tax amount
Municipalities can set their own coefficients in their local tax ordinance (Ordenanza fiscal), but may not exceed the statutory maximum coefficients. For an 8-year holding period, the current statutory maximum coefficient is 0.19. Current rates and coefficients should be verified with the relevant municipality before completing a sale, as they can change.
2. Real Method (método real)
For built properties, the actual increase in value is attributed to the land only proportionally. This is done using the ratio of the cadastral land value to the total cadastral value. Costs and taxes relating to the purchase or sale are generally not deductible for this Plusvalía calculation.
Formula: (Sale price − purchase price) × (cadastral land value ÷ total cadastral value) = taxable base; the municipal rate is then applied
Important: since the 2021 reform, the taxpayer can request that the actual increase in value be used instead of the objective method, where this is lower. To do so, the purchase and sale values must be evidenced. In practice, it should always be checked whether the real method is more favourable and whether it needs to be formally claimed with the municipality.
Tax Rates in Mallorca
The Plusvalía is a purely local tax — the rate and coefficients vary by municipality within the statutory maximum of 30%. Many Mallorca municipalities are close to the statutory maximum rate, but the actual burden depends on the specific local tax ordinance and municipal coefficients. Current rates should be verified with the relevant municipality (e.g. Palma, Calvià) before completing a sale, as they can change annually.
Who Pays the Plusvalía for Non-Residents?
For a sale by a non-Spain-resident individual, the buyer is treated, vis-à-vis the municipality, as the sustituto del contribuyente. They therefore step into the tax obligations for handling the Plusvalía municipal — regardless of who bears the tax economically. In practice, it is often contractually agreed that an estimated Plusvalía amount is withheld from the purchase price at the notary appointment, or otherwise secured. However, this is a private-law agreement between buyer and seller and should be expressly set out in the purchase contract. This rule applies to non-resident individuals as sellers — other seller structures (e.g. companies) are subject to separate rules.
| Type of transfer | Regular taxpayer | For non-resident individuals |
|---|---|---|
| Sale (for consideration) | Seller | Buyer steps in as sustituto del contribuyente |
| Inheritance/gift (free of charge) | Acquirer (heir/donee) | Acquirer (no change) |
Worked Example: Sale in Calvià
Situation: A German couple sell a property in Calvià that they acquired 8 years ago. Purchase price then: €500,000. Sale price now: €750,000. Land share of the cadastral value: 40%, total cadastral value €200,000 (of which €80,000 is the land value).
Objective method:
| Detail | Value |
|---|---|
| Land value (cadastral share) | €80,000 |
| Coefficient (8-year holding period, current maximum table) | up to 0.19 |
| Taxable base | €80,000 × 0.19 = €15,200 |
| Municipal rate | 30% |
| Tax (objective method) | €4,560 |
Real method:
| Detail | Value |
|---|---|
| Total increase in value | €750,000 − €500,000 = €250,000 |
| Land share (40%) | €100,000 |
| Municipal rate | 30% |
| Tax (real method) | €30,000 |
In this example, the objective method is significantly more favourable (€4,560 vs. €30,000). The specific coefficients vary by municipality and local tax ordinance and should be verified before an actual sale.
Distinction: Plusvalía vs. Modelo 210/211
Sellers frequently confuse two entirely independent taxes:
| Tax | What is taxed | Who levies it |
|---|---|---|
| Plusvalía municipal (IIVTNU) | Increase in value of the land | Municipality |
| Modelo 210 (Ganancia patrimonial) | Total capital gain (land + building) | National AEAT |
| Modelo 211 | 3% withholding tax as an advance payment on the Modelo 210 liability | National AEAT |
Both taxes — the Plusvalía and the Modelo 210 capital gains tax — must be paid independently and in parallel. Paying one does not replace the other.
Deadlines
For sales and other transfers between living parties, the deadline is generally 30 working days from the transfer. For inheritances, it is six months from the date of death and can be extended, on request, to up to one year.
What We See in Practice
At Fiscaro, we regularly observe the following patterns in property sales:
Plusvalía and Ganancia patrimonial are confused: many sellers assume that the 3% withholding (Modelo 211) already covers everything — the Plusvalía is completely overlooked until the municipality gets in touch.
Non-liability in loss-making sales is not claimed: someone selling a property with no actual increase in the value of the land share often still pays the Plusvalía, because this is not actively declared and evidenced.
The more favourable calculation method is not checked: not every municipality automatically calculates the real method — running your own comparison, and where necessary actively requesting it, is often worthwhile.
What Does This Mean in Practice for Sellers?
- Before selling, check whether there has actually been an increase in the value of the land share
- Where there is no increase in value: actively declare the non-liability and evidence it with the purchase/sale deeds
- Compare both calculation methods and actively claim the real method if it is more favourable
- If selling as a non-resident individual: clarify how the payment obligation (sustituto del contribuyente falling on the buyer) is contractually arranged between the parties
- Plan for the Plusvalía and Modelo 210/211 as separate obligations to be met in parallel
- Observe the deadlines: 30 working days for a sale, 6 months for inheritance
How High Is Your Ongoing Modelo 210 Tax? Calculate Now
Regardless of a future sale: as long as you are the owner, Modelo 210 applies annually. Our calculator gives you a quick estimate.
→ Calculate your Modelo 210 tax now
Common Mistakes with the Plusvalía Municipal
- Confusing the Plusvalía with capital gains tax — both are independent taxes payable in parallel
- Not claiming non-liability in loss-making sales — leads to unnecessary tax payments
- Only accepting the objective calculation method without having the real method checked
- Payment obligation on a non-resident sale not contractually regulated — leads to disputes between buyer and seller over who bears the economic cost
- Missing the filing deadline — leads to municipal surcharges
FAQ
Do I have to pay the Plusvalía if I sell the property at a loss? No — if there is no actual increase in the value of the land share, the transaction is not subject to tax. However, this absence of an increase in value must be actively declared and evidenced with the purchase and sale deeds.
Is the Plusvalía the same as the 3% withholding on sale? No. The 3% withholding (Modelo 211) is an advance payment towards the national capital gains tax (Modelo 210). The Plusvalía municipal is a completely separate, local tax on the increase in value of the land.
Who pays the Plusvalía if I sell as a non-resident? If you sell as a non-Spain-resident individual, the buyer steps into your obligations towards the municipality as the sustituto del contribuyente. Who bears the tax economically is, in practice, usually agreed contractually between buyer and seller.
Can I choose which calculation method is applied? You can request that the real method be applied if it is more favourable for you than the objective method — to do so, you must evidence the purchase and sale values and formally claim this with the municipality.
Does the Plusvalía also apply on inheritance? Yes — on a transfer free of charge through inheritance, the heir is liable for the tax. More on this in our guide on inherited properties.
What is the tax rate in Mallorca? Many municipalities are close to the statutory maximum rate of 30%. The exact rates and coefficients should be verified with the relevant municipality before completing a sale.
Sources
- Real Decreto Legislativo 2/2004 (Law Regulating Local Treasuries, IIVTNU), Art. 104–110
- Real Decreto-ley 26/2021 (introduced the two calculation methods following the 2021 Constitutional Court ruling)
- Constitutional Court, ruling of October 2021 on the unconstitutionality of the previous calculation method
- Local tax ordinances (Ordenanzas Fiscales) of the relevant municipality, e.g. Palma, Calvià
Conclusion
The Plusvalía municipal is a standalone, often overlooked tax when selling property in Mallorca — independent of the capital gains tax via Modelo 210/211. Anyone who actively claims non-liability where there is no increase in value, and documents the actual change in value to check whether the real method is more favourable, can avoid unnecessary payments.
Fiscaro supports you with your ongoing Modelo 210 process — for the Plusvalía municipal, we recommend consulting a local gestoría, as the calculation is municipality-specific.
Hanns-Christopher Deppe
Founder of Fiscaro · Real Estate Economist & Dipl. Industrial Engineer · Agent in Mallorca
Hanns-Christopher has lived in Mallorca for over 15 years and has guided hundreds of non-residents through their Spanish tax obligations. He founded Fiscaro to make the Modelo 210 process as simple as possible.
This article is for general information purposes only and does not constitute individual tax advice. For an assessment tailored to your specific circumstances, we recommend consulting a qualified tax adviser or Spanish gestoría.
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