Solidarity Tax Spain: Who Pays Above 3 Million Euros

The solidarity tax only catches a small group on Mallorca, but for that group the numbers are worth running. Since the Balearic Islands raised their own wealth tax allowance to 3,000,000 EUR, the ISGF now starts exactly where the Balearic tax stops. If you are a resident with a net worth above roughly 3.7 million euros, or a non-resident who owns Spanish property worth more than 3 million euros, it is worth understanding how the two taxes interact before the Modelo 718 return comes due in July.

The solidarity tax, officially the Impuesto Temporal de Solidaridad sobre las Grandes Fortunas (ISGF), is a national Spanish tax on net worth above 3,000,000 EUR. It sits on top of the regional wealth tax and stops regions with their own tax breaks from leaving large fortunes completely untaxed.

Who pays and from when: allowances for 2026

The ISGF was introduced with Ley 38/2022 and, according to the Agencia Tributaria, also applies to the 2025 tax year, which you declare in 2026. It is based on your net worth as of 31 December, meaning the value of all your assets minus your debts.

Residents get a general allowance of 700,000 EUR on top of the zero-rate band, plus an exemption for the main home of up to 300,000 EUR. In practice, this means the ISGF usually only kicks in for residents above roughly 3.7 to 4 million euros of net worth. Non-residents do not get the 700,000 EUR allowance, so their Spanish assets are counted from 3 million euros.

One fact that hits the Balearic Islands in particular: since 1 January 2024, the Balearic wealth tax allowance has stood at 3,000,000 EUR (Ley 12/2023), exactly matching the zero-rate band where the national ISGF also begins. Anyone who previously had between 700,000 EUR and 3 million euros in assets on the Balearic Islands, and paid some regional wealth tax on it, has paid nothing there since 2024, without the ISGF changing that.

How the Balearic wealth tax is credited

The ISGF is not an extra penalty tax. Whatever Balearic wealth tax you already pay is deducted from your ISGF bill. In the end you never pay both taxes at their full amount, only the effective equivalent of the higher of the two.

Among other things, the calculation counts:

• Property on Mallorca and elsewhere in Spain, valued at the higher of the cadastral value, the purchase price, or the market value
• Bank balances, investment portfolios, and company shareholdings
• Insurance policies with a surrender value and certain pension entitlements
• Debts, which may be deducted from gross assets

A cap also applies: the sum of income tax, regional wealth tax, and ISGF may not exceed 60 percent of your income tax base. If it does, the ISGF is reduced, but by no more than 80 percent of what it would otherwise be. So at least a fifth of the calculated ISGF is always owed regardless.

Worked example: a resident with 4.5 million euros

Take a resident on Mallorca with 4,500,000 EUR in net worth who fully uses her main-home allowance.

For the ISGF she first deducts the 700,000 EUR general allowance and 300,000 EUR for the main home. Of the remaining 3,500,000 EUR, the first 3,000,000 EUR is taxed at 0 percent, and only the remaining 500,000 EUR falls into the 1.7 percent bracket. That gives an ISGF bill of 8,500 EUR before crediting.

For the Balearic wealth tax she deducts the 3,000,000 EUR allowance plus 300,000 EUR for the main home, leaving a taxable base of 1,200,000 EUR. Under the current Balearic scale, that comes to around 9,950 EUR of regional tax.

Because the Balearic tax she already paid is higher than the ISGF bill, the ISGF is credited down to 0 EUR entirely. She pays around 9,950 EUR in total, not both amounts added together.

Worked example: a non-resident with a 6 million euro villa

A non-resident owns a villa near Pollença worth 6,000,000 EUR and holds no other Spanish assets. Because he does not live there, the main-home exemption does not apply, and as a non-resident he also does not get the 700,000 EUR ISGF allowance.

His ISGF base is therefore the full 6,000,000 EUR. The first 3,000,000 EUR is tax-free, and the remaining 3,000,000 EUR falls entirely into the 1.7 percent bracket. That gives an ISGF bill of 51,000 EUR before crediting.

For the regional wealth tax, EU and EEA citizens can, since a legal reform, choose the rules of the region where their most valuable Spanish asset is located, in this case the Balearic Islands. With the Balearic allowance of 3,000,000 EUR, 3,000,000 EUR remains as the taxable base, which works out to around 42,950 EUR of regional tax under the Balearic scale.

After crediting that 42,950 EUR, around 8,050 EUR of the ISGF is still owed on top. In total he pays around 51,000 EUR, which is exactly the amount that was due as the ISGF bill in the first place, just split across two returns. Because the choice of regional rules in a case like this can depend on other assets held elsewhere, it is worth having a tax adviser check this specific point.

Modelo 718: deadline and process

You file the ISGF using Modelo 718 through the electronic office of the Agencia Tributaria. The return for a given tax year opens on 1 July of the following year, so the return for 2025 opens on 1 July 2026. The exact forms and deadlines are set by the tax authority each year through its own order, most recently Orden HAC/652/2026.

You still report the Balearic wealth tax itself separately, to the Agència Tributària de les Illes Balears, ATIB, using Modelo 714. Both returns cover the same net worth as of 31 December, but the forms and the authorities handling them are separate.

Do I have to pay the solidarity tax if I have already paid Balearic wealth tax? No, not on top at the full rate. The wealth tax you already paid on the Balearic Islands is credited against the ISGF. You end up paying only the higher of the two amounts, never both added together.

If you already report Balearic wealth tax through the standard Modelo 714, you do not need to work out new figures for the ISGF. The list of assets is identical, only the allowances and the tax rate differ. For more on the regional tax and its allowances, see our guide to wealth tax in the Balearics, and for how your resident tax status is determined in the first place, see our guide to tax residency on Mallorca.

If you hold assets outside Spain as well as in Spain, double taxation often becomes a factor too. How Spain handles that alongside other countries is explained in our guide to tax residency and double taxation.

Conclusion

The solidarity tax sounds more threatening than it usually turns out to be for most residents on Mallorca, because the Balearic wealth tax is almost always credited against it. In practice, it affects residents with a net worth from around 3.7 million euros and non-residents with Spanish assets from 3 million euros. What matters is not missing the Modelo 718 deadlines from July onward, and bringing in a tax adviser early if your assets are larger or span more than one country, so the crediting gets worked out correctly for your specific case.