Tax and accounting in Palma de Mallorca

Places, not individual licences

The Balearic model does not simply authorise dwellings one by one: it runs on a limited pool of tourist places, so that registering a property for marketing requires having places available and, in practice, buying them from another holder. On top of that sit the island zoning rules and, in apartment buildings, the position taken by the comunidad de propietarios — the owners' association that every block of flats in Spain has by law, and which votes on matters affecting the building.

We give no number of available places and no dates here: it is a moving subject decided by the Consell, the island council, and by the city council. What we do is check what is actually registered in your name before touching anything, because advertising without a registration number is exactly what gets penalised.

Two terms for readers outside Spain. The Consell Insular is the island-level administration, sitting between the town hall and the Balearic government, and in tourism matters it is usually the body that authorises and the body that penalises. The registration number is the code the register issues to a dwelling cleared for marketing, and it has to appear in every advertisement, which is what makes an unregistered listing so easy to spot.

What happens once the penalty file has arrived

A penalty in tourism matters is not a tax assessment and it is not defended in the same way: it has its own procedure, its own window for submissions and its own reductions for early payment and acknowledgement, which are sometimes worth taking and sometimes not. Whether they are worth taking depends on whether there is anything to argue on the substance, and that is looked at before anything is signed.

In parallel, the tax side carries on: the income obtained exists even if the activity was irregular, and it has to be declared. If there are years outstanding, they are put in order before they arrive by another route: that is in filing late.

Seasonal letting, under watch

The usual way out — moving to seasonal contracts — is examined closely here, precisely because it is the natural route for sidestepping the tourism regime. A contract headed "seasonal" is not thereby seasonal: what decides it is the purpose, the real duration, the turnover of occupants and the services provided.

On the reconciliation with the platforms that appears in the table below: Airbnb and Booking report what they paid out, and the figure behind it is the gross the guest paid, not the net that reached your account. Your income is that gross, with the commission entering as a cost. Declaring only the transfer produces a difference anybody can see without forming a judgement about it, and it is a frequent reason a Palma file attracts a letter.

On the tax side, the immediate consequence is VAT. Letting a dwelling is exempt under article 20.Uno.23 of the Spanish VAT Act; the moment services proper to the hotel industry appear, it stops being exempt, and a seasonal contract that hides stays with cleaning and fresh linen loses it. The 30-night threshold taxed at 10 %, brought in by the decree-law of 29 September 2026, is not in force: Congress rejected it on 2 October, and the EU directive allows until July 2028. It is compared in tourist or seasonal letting.

Who writes to us from Palma

Who	What they usually face
Owner marketing a dwelling with places of their own	VAT where there are services, income tax and reconciling against what the platforms report
Someone who advertised without registration and got a file opened	Submissions in time and, separately, regularising the income obtained
German owner with a house on the island	Modelo 210 per property and per owner, the 19 % rate and an annual residence certificate
High-net-worth resident	Modelo 714 above 2.000.000 € and the tax on large fortunes from 3.000.000 €
Seasonal worker with two employers	The duty to file a return and wrongly calculated withholding

Working with Palma, remotely

With our cards face up. If what you have is a penalty file, we tell you what real room we see and what we do not, without promising you that it will be shelved: that cannot be promised, and anyone who promises it is selling smoke.

The tax side we run as a quarterly routine and remotely, in Spanish, English and German, which is the combination the island asks for. For an owner who does not live in Spain the central piece is non-resident income tax, with its Modelo 210 per property and per owner. And we always keep the two invoices apart: the planning and penalty side goes its own way, the recurring tax work goes another.

One thing we insist on before taking anything on: a complete list of what you own on the island and how it is held. A file that starts with one flat and turns out to include a second one in a relative's name, or a company nobody mentioned, is a file that has to be done twice. We would rather spend the first hour on the inventory than the fourth month on the repair.

A seasonal waitress in Palma with three payers: why she ends up owing

One of the most frequent matters on the island and one of the least talked about, because there is nothing touristy about it for the person going through it. A hospitality worker strings together, in 2026, a summer contract at a hotel in Platja de Palma, a few winter months at a restaurant in the centre and unemployment benefit in between. No payer knows what the others pay her, so each one withholds as if it were the only one.

Payer	Income	Withholding
Hotel, May to October	12,500 €	520 €
Restaurant, November and December	3,400 €	60 €
Unemployment benefit, which is also a payer	2,600 €	0 €
Total	18,500 €	580 €

With a single payer she would not have to file a return below 22,000 €. But the second and further payers add up to 6,000 €, more than 1,500 €, and the limit drops to 15,876 €: she has to file, and the tax on 18,500 € worked out in one go is higher than the sum of what each payer withheld separately. The difference is payable in June 2027. It is nobody's mistake; it is the arithmetic of having several payers.

For the following year there is a remedy: ask the main payer for a higher withholding rate on Modelo 145, the form an employee uses to give their employer the data for withholding, so the payment is spread across the payslips and does not arrive all at once in summer. If what you have received is already a letter for not having filed, the form is the one for replying to the tax authority.

A point for anyone drawing unemployment benefit between contracts: the benefit is taxed as employment income, and the public employment service appears in your tax data as one more payer. We have seen returns made from the draft that left out exactly that line because the benefit «is not a salary». The omission is detected automatically, because the payer has reported it.

If you register as self-employed in Palma over the winter

It is the other usual way out of the season: working as an employee in summer and invoicing in winter, as a guide, a teacher or a photographer. During the months when both overlap there is dual activity, with its own contribution rules, and in the first year the flat rate of 86 € a month may apply if its requirements are met. What does not change is that the income tax return brings the payslip and the business together. It is in employee and self-employed at once.