What is the Plusvalía / capital gains tax?

“Plusvalía municipal in Spain (2025): What German real estate buyers in Mallorca need to know”

When foreign buyers purchase real estate in Spain, they often come across the term Plusvalía municipal. Many do not know exactly what it means, when this tax is due, how high it can be – and how to avoid paying too much unnecessarily. In this article, you can find out everything you need to know about Plusvalía 2025 – explained clearly with examples and tips for your real estate transactions in Mallorca.

1. what exactly is the Plusvalía municipal?

Municipal capital gains tax levied by municipalities when a property is transferred – by sale, inheritance or gift.
This is based on the land value (not the total value of the property including construction) and how long you have owned it.
It is not the same as capital gains tax (IRPF), but it often increases the overall cost of the sale.

2 Who pays and when?

When selling: usually the seller.
In the case of gifts or inheritances: depending on the case, the recipient or the heirs.
Deadlines: 30 working days after transfer in the case of sale/gift; inheritance often has six months, with possible extension.
No payment required if no profit was made (e.g. if property is sold for less than the purchase price).

3. how the tax is calculated – the two methods

Objective method:
Land value (e.g. from the land register) × coefficient (depending on the years of ownership) → tax amount.
Real method:
Actual profit (sales price minus purchase price), for land portion. This method may be more favorable if the actual profit is lower than the profit calculated using the objective method.
Important: You can choose which method is more favorable in your situation.

4. new rules and coefficients 2025

Municipalities may not exceed the official coefficients, but they can set lower ones.
There are maximum values for periods of ownership above which the coefficient does not increase any further.
Some municipalities offer reductions for land values if the cadastral values are outdated.

5. calculation example for illustration

Specifically (adapted for Mallorca/example):

Let’s assume you bought a house for €300,000 in 2015, the land share according to the land register is 50%, i.e. the land value is €150,000.
Sale in 2025 for € 400,000.
Duration of ownership: 10 years → e.g. coefficient 0.16 (depending on municipality).
Objective method:
150,000 × 0.16 = € 24,000 as assessment basis → tax e.g. at 30% tax rate → approx. € 7,200.
Real method:
Sale value land portion: 400,000×50 % = 200,000 → Minus purchase value land portion: 300,000×50 % = 150,000 → Profit 50,000 → Tax approx. 15,000 €, if 30 %. In this example, the objective method would be significantly more favorable.

6 What should you consider as a German buyer?

Check the proportion of land in your documents (cadastral extract) at an early stage.
Pay attention to how your municipality has set the coefficients – there are differences between municipalities. Mallorca municipalities can have different values.
Document all costs that could reduce your profit (e.g. renovations, maintenance work, taxes) because they are relevant for the real calculation.
For large transfers, ask a tax advisor to show you which method is more favorable.
Don’t forget to include the Plusvalía in your IRPF declaration when you sell – especially if you have taken it over as the buyer.

Conclusion

The Plusvalía municipal is one of the often overlooked costs when selling real estate in Spain. For German buyers in Mallorca, it can have a significant impact on actual net profits. But if you:

knows how and when it is calculated,
knows all relevant values (land value, purchase and sale price, duration of ownership),
between objective and real methods, and
all costs documented –

then you can save a lot of tax and avoid surprises.

Perfect 👍

I am answering again as a real estate and tax law expert in Mallorca.

So you want a table/calculator function for the Plusvalía municipal. I can build you a simple model that you can use for yourself or your clients to roughly estimate how much the tax would be.

Example calculation of Plusvalia:

You only need four things for the calculation:

Purchase price of the property (or acquisition value, incl. land portion in the cadastral extract).
Selling price of the property (or current transfer value).
Proportion of land in the cadastral value (see Catastro extract: land vs. building).
Number of years of ownership (between purchase and sale/transfer).

Example table for overview

Parameters	Example value	Explanation
Purchase price	300.000 €	Purchase price according to Escritura
Selling price	400.000 €	Selling price according to Escritura
Proportion of land according to land register	50 %	to be found in Catastro certificate
Duration of ownership	10 years	Year of sale – Year of purchase
Municipality tax rate	30 %	Varies depending on the municipality (e.g. Palma, Andratx, Manacor)

Objective method:

Land value: € 300,000 × 50 % = € 150,000
Statutory coefficient for 10 years (assumed): 0.16
Assessment basis: 150,000 × 0.16 = € 24,000
Tax: 24,000 × 30 % = 7.200 €

Real method:

Land value sale: 400,000 × 50 % = € 200,000
Land value purchase: 300,000 × 50 % = € 150,000
Profit: 200,000 – 150,000 = 50,000 €
Tax: 50,000 × 30 % = 15.000 €

👉 Result: Objective method cheaper → € 7,200

Further information:

View the cadastral value of the property online: https://www1.sedecatastro.gob.es/Accesos/SECAccvr.aspx