Buying property in Tenerife means planning not just for the price tag — but for taxes, legal fees, and the island’s strict land-use regulations. If you’re a foreigner, knowing what’s urban, rustic, or protected land can save you thousands and prevent legal trouble.
At Borderless Lawyers, we give you a complete cost breakdown before you sign anything — and ensure the land is legally compliant.
🏷️ One-Time Taxes When Buying in Tenerife
✅ Resale Properties (Second-Hand)
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ITP (Transfer Tax):
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6.5% flat rate (in Canary Islands)
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✅ New Build Properties
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IGIC (Canary VAT): 7%
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Stamp Duty (AJD): 0.75% – 1%
💡 IGIC replaces mainland Spain’s 10% VAT. It applies only to brand new properties.
📋 Typical Additional Costs
| Cost | Estimated Range |
|---|---|
| Notary Fees | €600 – €1,200 |
| Land Registry Fees | €400 – €1,000 |
| Legal Fees (lawyer) | 0.75% – 1.5% of price |
| Bank or Gestoría Fees | €300 – €800 (if used) |
✅ Our fee includes NIE, POA management, and full tax coordination.
📍 Understanding Land Classification in Tenerife
Tenerife’s property market includes both urban and rustic areas — each with its own regulations.
🏙️ Urban Land (Suelo Urbano)
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Fully serviced
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Eligible for development and renovation
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Easier to register and finance
🌾 Rustic Land (Suelo Rústico)
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Often protected under environmental laws
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Heavily restricted for building or expanding
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Common in areas like La Orotava, El Rosario, and parts of Arona
✅ Many villas built on rustic land have illegal additions or lack a valid occupancy license.
📐 What We Check Before You Buy
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Zoning laws and building permissions
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Cadastre and registry alignment
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Legality of existing structures
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Coastal law compliance (Ley de Costas)
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Certificates from local Ayuntamiento
🧾 Annual Taxes for Property Owners
Once you own property in Tenerife, you must pay:
🏛️ IBI (Property Tax)
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Paid to the local town hall
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Based on cadastral value
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Typically €200–€2,000/year depending on property size and location
🌍 Non-Resident Income Tax (Modelo 210)
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Applies to all non-residents, even if the property isn’t rented
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Based on “imputed rental value”
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19% for EU/EEA citizens, 24% for non-EU
✅ We file this automatically each year for clients on our annual plan.
💼 What We Do
At Borderless Lawyers, we:
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Estimate all taxes and fees before you commit
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Check the land status and urban planning rules
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Pay ITP, IGIC, and AJD on your behalf
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Register your title and update the Cadastre
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Advise on future tax liability or resale costs
💬 Final Word
Tenerife has its own tax rules and zoning quirks. Whether you’re buying in Costa Adeje, Puerto de la Cruz, or Santa Cruz, skipping tax planning or land checks can turn a dream into a legal and financial disaster.
📞 Contact us today to get a full tax breakdown and land assessment before you buy property in Tenerife.