Foreigners with luxury homes in the Balearics will be able to save up to 30.000€ yearly in taxes

Without any doubt, Mallorca is the best place in the world to live. This Mediterranean paradise opens its doors to the lovers of the good life and breathtaking scenery.

Out of the millions of people who visit the island all year round, there are many who would love to establish their residence in this coveted locatiion.  The peace provided by a safe and relatively calm place, the mild climate all year round,, an international airport in the capital city and an ever increasing network of businesses are just a a handful of reasons why many people decide to move to the island,

Moreover, it is a fact that there is an increasing number of citizens from overseas who want to reside permanently on the island. This clearly adds value to the population factor of the Balearics, and so the regional government has decided to pass legislation to exempt owners from overseas who have a home in the Balearics from paying taxes on their property.

Abolishment of property tax for foreign residents on the islands

The Wealth Tax is a tax obligation of individuals resident and non-resident in Spain who are holders of assets or rights located in national territory. It is a declaration of assets taxed on wealth of economic content.

In order to favor the international community and encourage the purchase of assets in the region, the regional government has decided that from 2024 the owners of luxury residences will not pay this tax. Foreigners buying a property in the region will be able to save up to €30,000 in taxes each year thanks to this measure.

Thus, wealth will be taxed from €3,000,000, which means that a foreign person will only have to pay this tax from that amount. The first €3.000.000 will not count on the tax declaration.

According to lawyer Alejandro Feliu of Feliu Bellapart Abogados, "For example, if a non-resident couple bought a house for 5,500,000 euros and paid approximately 500,000 euros in taxes for the purchase, the net worth of the couple would amount to 6,000,000 euros, so they would not have to pay Wealth Tax as an exemption of 3,000,000 euros would be applied to each one”.

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