Holiday rentals on Mallorca - ETV licence, rules, taxes

Few topics on Mallorca are as charged with emotion as holiday rentals. For property owners they are an attractive source of income, for residents a contributor to soaring rents, and for the regional government a regulatory challenge. Anyone wanting to rent their property legally to tourists operates within a tight framework of licences, zoning plans, taxes and community resolutions.

This article summarises the situation in 2026 and shows you what steps are needed to keep your rental on the right side of the law.

Current legal situation 2026

In the Balearic Islands, holiday rentals are regulated by Ley 8/2012 and subsequent reforms. The competent authorities are the Consell de Mallorca (island council) and the relevant municipality. The key points:

• Moratorium on new licences: For large parts of the island, no new ETV licences have been issued for years. Anyone wanting to start out usually has to buy an existing licence slot (plaza turística) on the secondary market.
• Balearic zoning plan: Each municipality has its own zoning plan (zonificación) with three categories: zones where rental is permitted, transition zones and prohibited zones. In Palma, renting flats in apartment buildings has been practically banned since 2018.
• Fincas and detached houses: Detached houses and fincas in rural areas have significantly better chances of obtaining a licence than flats in apartment buildings.
• Comunidad approval: For flats in buildings with multiple owners, a resolution of the Comunidad with a three-fifths majority is required. Without approval the licence cannot be obtained - see Neighbour law and Comunidad.

What is an ETV licence

ETV stands for Estancia Turística de Viviendas - tourist accommodation in residential properties. It is the official authorisation to rent your property to tourists for stays of less than 30 days. Without it, any short-term rental is illegal.

Types of ETV

• ETV for flats (plurifamiliares): flats in apartment buildings. Heavily restricted and in Palma practically unavailable.
• ETV for detached houses (unifamiliares): terraced houses, stand-alone houses, fincas. Better prospects, but still zone-dependent.
• ETV for fincas (suelo rústico): buildings in rural areas, strict requirements on existing stock and minimum size.
• Transitional licences: licences from earlier regulations that continue to run for a limited time.

You do not obtain the ETV from your municipality but from the Consell de Mallorca or directly from the Govern Balear. After issue you receive a registration number that must be stated in every listing, on every contract and in every communication with guests.

Requirements and application

Before submitting an application, you need to check whether your property qualifies at all. The main requirements:

Structural and legal requirements

• Valid Cédula de Habitabilidad (certificate of habitability), not older than 10 years
• Valid energy certificate (Certificado Energético)
• No planning violations (all structures must be legal)
• Proof of IBI payments for recent years
• For flats: approval of the Comunidad
• Minimum equipment to Balearic standards (towels, bed linen, Wi-Fi, smoke detectors)

The application process

1. Pre-check: a Gestoría or lawyer verifies whether your property is in a permitted zone and whether a licence slot is available.
2. Obtain a plaza turística: in most zones you need to purchase an existing licence slot. The market is organised through specialist agents.
3. Assemble documents: Escritura, Cédula, energy certificate, floor plan, Nota Simple, Comunidad resolution, insurance if required.
4. Submit application: via the Govern Balear portal or in person at the Consell.
5. Inspection: an inspector checks the property on-site (equipment, fire safety, floor areas).
6. Issue of number: once issued, you may officially rent and use the number in listings.

The whole process typically takes three to twelve months, depending on the zone and the authority's workload. Without professional support from a Gestoría or specialist lawyer the process is barely manageable.

Tax obligations

The licence alone is not enough. Anyone renting legally must also be tax-compliant. The main obligations:

Income tax on rental income

• Residents (more than 183 days per year on Mallorca) declare income within their annual Renta.
• Non-residents from the EU pay 19 percent on net profit (income minus deductible costs).
• Non-residents from outside the EU pay 24 percent on gross income; costs are not deductible.

The return is filed quarterly using Modelo 210 for non-residents or in the annual Renta (Modelo 100) for residents.

VAT on holiday rentals

The simple letting of a property is exempt from VAT (IVA). However, as soon as you offer hotel-like services (breakfast, daily cleaning, reception), the entire rental becomes liable to IVA at 10 percent.

Tourist Tax (ITS)

The Impost sobre les Estades Turístiques (ITS) applies per guest per night. Rates for 2026:

Accommodation type	Per night in high season	Per night in low season
Holiday flats (ETV)	2.00 EUR	0.50 EUR
Fincas / detached houses	3.00 EUR	0.75 EUR
Hotels 4 to 5 stars	3.00 EUR	0.75 EUR

The ITS is borne by the guest but must be collected by the landlord and remitted quarterly to the Balearic tax authority.

Fines for illegal rentals

The Balearic Islands take a consistent approach to illegal holiday rentals. Dedicated inspectors check suspicious listings, cross-reference platform data and follow up tips from neighbours and Comunidades.

Fines under tourism law

• Minor violations: 1,000 to 20,000 EUR (e.g. missing number in a listing despite having a licence)
• Serious violations: 20,000 to 40,000 EUR per case (renting without a licence, wrong zone)
• Very serious violations: 40,000 to 400,000 EUR (commercial structures, repeated violations)

Further consequences

• Obligation to cease rental immediately
• Repayment of rental income collected to guests in the event of cancellation
• Penalty assessments from the Agencia Tributaria for undeclared income
• Sanctions from the Comunidad (damages, injunction)

What you should never do

• List a property without a licence on platforms
• Apply a valid licence to a different property
• Publish listings without a registration number
• Handle payments in cash without a contract

Alternatives (long-term rental)

If an ETV licence in your zone is no longer available, or the process seems too burdensome, there are legal alternatives:

Long-term rental (more than 32 days)

Tenancy agreements for more than 32 days fall under the Ley de Arrendamientos Urbanos (LAU) and do not require an ETV licence. You declare income under normal income tax rules. Important: under the LAU, the tenant has significantly stronger protection - notice periods and tenancy protection rules apply in full. More on this in the article Understanding your rental contract.

Seasonal rental (alquiler de temporada)

A middle ground: agreements from 32 days to eleven months with a clear seasonal purpose. No full LAU protection, but no ETV requirement either. For many German property owners on Mallorca this is the practical solution when they use the property themselves in summer and only rent it out in winter.

Corporate housing for employees

Companies are increasingly looking for furnished flats for employee relocation. Contracts of 3 to 12 months are typical; no ETV required. Margins are lower than with holiday rentals, but occupancy is consistent.

Sale

In many zones, legal holiday rental has become so expensive or so unlikely to succeed that buying a property as a pure investment no longer makes financial sense. Anyone who bought with that motivation should check with their Gestoría whether selling is the better option.

Anyone who sets up their holiday rental properly can still make good money on Mallorca. But only with a licence, with correct tax declarations and with the knowledge that the rules will continue to change.