How can you access the reduced 4% property tax rate when buying a home in Menorca?

How can you access the reduced 4% Property Transfer Tax (ITP) rate when buying a home in Menorca?

Buying a second-hand home in Menorca entails certain taxes, including the Property Transfer Tax (ITP). Generally, this tax is 8%, but there are reduced rates that can represent significant savings for some buyers. One of the most interesting is the reduced rate of 4%, intended for those who purchase their primary residence, provided they meet certain requirements.

At SOM Menorca, as real estate experts with over 30 years of experience in the sector, we explain everything you need to know to benefit from this tax advantage if you're thinking of buying in Menorca or anywhere in the Balearic Islands.

Who can benefit from the reduced 4% Property Transfer Tax (ITP) when buying a home?

The reduced Property Transfer Tax (ITP) is intended for individuals who use the property as their primary residence and meet the following requirements:

1. Primary Residence

• The buyer must establish their primary residence in the acquired property within a maximum of one year of purchase.
• In addition, they must maintain that residence as their primary residence for at least three consecutive years.

2. Income Limits

• The buyer's annual income must not exceed:
€52,800 if filing individually.
€84,480 if filing jointly (for example, as a couple or family).

3. Maximum Property Value

• The property purchased cannot exceed a maximum value of €270,151.20.
This value refers to the higher of: the registered value or the value verified by the Tax Office.

4. Declaration and Documentation

To apply the reduced 4% property tax (ITP) when purchasing a second-hand home in Menorca, you must expressly request the reduced rate when submitting the property tax return (form 600) and supporting documentation.

By trusting our real estate agency, you don't have to worry about a thing. We take care of everything.

In addition to the reduced rate of 4%, in the Balearic Islands there are other even lower rates (3.5%, 2.5%, etc.) in special cases such as:

• Young people under 36 years of age.
• Large or single-parent families.
• People with a disability equal to or greater than 33%.
• Social housing (VPO).

Each of these cases has its own requirements.

At SOM Menorca, we will advise you properly before signing the purchase agreement.