Taxes and costs when buying property in Tenerife
Published 9 August 2026 · Last reviewed 9 August 2026. Tax rates can change — always confirm the current figures with your gestoría before signing.
The advertised price of a property is never what you end up paying. Between taxes, notary, land registry and gestoría fees, it's reasonable to budget an extra 8–10% on top of the purchase price in the Canary Islands. Here's each item broken down.
IGIC, not VAT — the Canary Islands' own regime
The Canary Islands have their own tax framework, the REF (Régimen Económico y Fiscal), and mainland Spain's VAT doesn't apply here. Instead, buying a new-build property (first transfer) is taxed under IGIC (the Canary Islands' general indirect tax), with a reduced rate for housing that's noticeably lower than the VAT you'd pay on the mainland for the same thing.
ITP — for resale property
If you're buying a resale property — which is the vast majority of our catalogue — you don't pay IGIC on the transfer; instead you pay ITP (Impuesto de Transmisiones Patrimoniales, a transfer tax), a regional tax whose rate is set by the Canary Islands government and calculated on the purchase price or the cadastral reference value, whichever is higher.
AJD — stamp duty on notarial documents
AJD taxes the notarial documents of certain transactions, mainly when a mortgage is involved. If you're buying in cash without a mortgage, it usually doesn't apply; if you need a mortgage, your gestoría will tell you the current rate applicable to the loan deed.
Notary, land registry and gestoría
On top of the taxes, there are three fixed items:
- Notary: fees set by a public fee schedule, based on the price and complexity of the deed.
- Land Registry: registering the new ownership, also on a regulated fee schedule.
- Gestoría: handling tax filings and payments with the authorities — especially worth using if you're buying from outside Spain and can't handle this in person.
A rough example
For a resale property priced at €150,000, a reasonable estimate for additional costs — ITP, notary, land registry and gestoría — usually falls between €12,000 and €15,000, i.e. the 8–10% mentioned above. It's an estimate, not a final figure: the exact amount depends on the ITP rate in force at the time of purchase, the cadastral reference value and the specific fees charged by each notary and gestoría.
If you need a mortgage
Add the property valuation (required by the bank) and, where it applies, AJD on the loan deed. Spanish banks typically ask for an NIE, proof of income and, for non-residents, sometimes a higher deposit percentage than for residents — check with your bank before finalising your budget.
Our recommendation
Don't sign any deposit contract without first working out the total cost, taxes included, with a gestoría you trust. At Tenedomus we can put you in touch with gestorías and notaries we work with regularly in south Tenerife. If you're considering buying, browse our catalogue of homes for sale or write to us to work through the specifics of your case.
Want an estimate for a specific property?
Tell us the approximate price and we'll help you calculate the total cost before you make an offer.
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