Non-Resident Wealth Tax in Spain: What It Is, Whether You Owe It, and What Changed in 2026

If you own property in Mallorca and do not live in Spain, you have almost certainly heard of the Impuesto sobre el Patrimonio — Spain's annual wealth tax. You may have been told you don't need to worry about it, or you may have been told you do, and been unsure which advice to trust. The honest answer is: it depends on the value of your Spanish assets, which region those assets are in, and — since a significant ruling in late 2025 — what nationality you hold.

This article explains how the tax works for non-residents with property in Mallorca, what the current thresholds and rates are, and what the 2026 position actually means for the typical buyer in the southwest.

What the Tax Is

The Impuesto sobre el Patrimonio is an annual tax levied on the net value of assets. It is calculated based on what you own on 31 December each year. For Spanish tax residents, it applies to worldwide assets. For non-residents — which includes anyone who spends fewer than 183 days per year in Spain — it applies only to assets located in Spain. For a property owner in Mallorca who lives abroad, that typically means the value of the property, minus any outstanding mortgage secured against it.

Net value is the key figure. If your Mallorca property is worth €900,000 and you have a €250,000 mortgage on it, your taxable Spanish net assets for wealth tax purposes are €650,000 — below the threshold, with nothing to pay.

The Threshold and the Balearic Exemption

The national state allowance is €700,000 per person. Below that figure in net Spanish assets, no wealth tax is due under the national rules. Above it, progressive rates apply starting at 0.2% and rising to 3.5% on the highest tranches.

Here is where the Balearic Islands position becomes important. Under Law 13/2023 of the Balearic government, the regional personal exemption was raised to €3,000,000. This means that for anyone who can elect Balearic rules — more on who qualifies in a moment — the wealth tax threshold is effectively €3 million of net Spanish assets. Below that, regional wealth tax liability is zero.

For the majority of non-resident property owners in Mallorca, this makes a very significant practical difference. A property worth €1.5 million with no mortgage would sit below the Balearic exemption entirely. Under national rules alone, the taxable amount would be €800,000 (after the €700,000 allowance) at rates around 0.5–1%, producing a meaningful annual bill.

Who Can Elect Balearic Rules: The 2026 Change

Until recently, the ability to elect the rules of a specific autonomous community for wealth tax purposes was restricted to EU and EEA residents. Non-EU nationals — British buyers post-Brexit, Americans, Canadians, Australians — were forced to use the national scale regardless of where in Spain their assets were located.

A ruling by the Tribunal Económico Administrativo Central (TEAC) on 24 September 2025 changed this. It confirmed that non-EU residents can now elect the wealth tax regime of the autonomous community where the bulk of their Spanish assets are situated. For a British, American or Australian buyer with property in Mallorca, this means opting for the Balearic €3 million exemption is now available — provided the election is made correctly in the tax return.

This is a material change for a significant number of non-resident owners in Mallorca and one that had not been available until the 2025 ruling. Anyone in this position who has been filing on the national scale in previous years should take advice on whether an amended return is possible and worthwhile.

What About Assets Above €3 Million

The Balearic exemption at €3 million does not mean zero liability for everyone. Spain introduced a parallel national tax in 2022 — the Impuesto Temporal de Solidaridad de las Grandes Fortunas, initially framed as temporary but extended indefinitely in 2025. This Solidarity Tax applies to net Spanish assets above €3 million and operates as a top-up mechanism, meaning it captures the amount that the regional exemption would otherwise have sheltered from wealth tax.

In practice, the regional exemption eliminates regional wealth tax for assets below €3 million, but the Solidarity Tax means that high-value asset holders above that threshold still face a national liability. The Solidarity Tax rates run from 1.7% on amounts between €3 million and €5.3 million, 2.1% between €5.3 million and €10.7 million, and 3.5% above that. These are applied progressively on the portion of assets exceeding €3 million.

Filing Obligations

Even where no tax is ultimately payable, a wealth tax declaration (Modelo 714) may still be required. The rule is that a return must be filed if the gross value of Spanish assets exceeds €2 million, regardless of net position — or if tax is actually due after allowances and deductions. Non-residents are not required to file Form 720, which is the assets declaration used by Spanish residents for overseas assets.

The filing period for wealth tax runs broadly from April to June, aligned with the income tax season in Spain. Specific dates can shift slightly year to year and should be confirmed with a tax adviser or the Agencia Tributaria ahead of the deadline.

What This Means in Practice for a Mallorca Property Owner

For a non-resident owning a single property in Mallorca worth up to €3 million net of mortgage, and who actively elects Balearic rules in their Modelo 714, the regional wealth tax position is zero. They may still have a filing obligation if gross Spanish assets exceed €2 million, but no tax is due.

For a non-resident with net Spanish assets above €3 million, the Solidarity Tax applies progressively to the excess, regardless of the regional rules elected.

For anyone unsure of their position — particularly those who have not previously filed, those who have been filing on the national scale as non-EU nationals without electing Balearic rules, or those whose asset values are close to relevant thresholds — taking qualified Spanish tax advice is the correct step. The rules have changed materially, the stakes are real, and the filing obligations apply regardless of whether tax is ultimately owed.

Imperial Properties are happy to refer buyers and owners to trusted local advisers. Contact us at help@imperial-properties.com or call +34 971 692 434.