Get up to €5,000 a year back in income tax with your solar or heat pump installation in Mallorca
If you are a Spanish tax resident and the property is your main home, the Balearic Government returns 50% of what you invest in renewables through your income-tax return, up to €10,000 of investment a year. Here is who qualifies, what is needed and how we manage it.
What the 50% deduction is
It is a regional income-tax (IRPF) deduction under Article 3 of Legislative Decree 1/2014 of the Balearic Islands, for investments that improve the sustainability of a main home located in the Balearics. It can be your own home or one you rent to a tenant who uses it as their main residence.
It is not a grant you apply for: it is applied directly in the income-tax return for the year you pay for the installation, reducing the tax you owe. It only applies if you file a Spanish income-tax return — non-residents who are taxed abroad cannot use it.
| Item | Figure |
|---|---|
| Deduction | 50% of the amount invested |
| Maximum base | €10,000 per year → up to €5,000 deduction |
| Key requirement | Improve the home’s energy rating by at least one letter |
| Validity | In force; the law sets no end date |
Who qualifies
Two conditions: the property must be in the Balearics and be a main home, and your income must not exceed these limits:
| Filing | Maximum total taxable base |
|---|---|
| Individual | €33,000 |
| Joint | €52,800 |
If you rent the property out
A landlord can also deduct the investment if the tenant uses the property as their main home and four conditions are met:
- A rental contract with the same tenant of one year or more.
- The deposit lodged with IBAVI (the Balearic housing institute).
- The rent declared in your Spanish income-tax return as property income.
- The cost of the installation not passed on to the tenant.
Which installations qualify
The law covers equipment that generates or uses renewable energy and reduces the home’s conventional energy use, and expressly names solar photovoltaic installations for self-consumption. In practice, for a home in Mallorca:
- Solar panels for self-consumption: expressly included. It is the clearest route, and it makes up for the lack of a FACTOR grant for household solar panels in 2026.
- A battery installed with the panels: part of the self-consumption installation.
- Heat pumps: not named in the law, although EU legislation treats the aerothermal energy of heat pumps as renewable. It may qualify if it improves the home’s energy rating. Ask us about your case before counting on it.
The key requirement: the energy certificate
To apply the deduction, the home must improve its energy-efficiency rating by at least one letter. This is proven with two registered energy performance certificates, one before and one after the installation, under Royal Decree 235/2013.
Without the “before” certificate there is no deduction, and it cannot be recovered afterwards. That is why the certificate is the first thing we do.
How we handle it at Sysefen
We manage the certificates and the paperwork. You just hand the documents to your tax adviser or include them in your return.
- Initial energy certificate of the home, registered before work starts.
- Installation of the panels, battery or heat pump, certified and registered.
- Final energy certificate and registration, proving the improvement.
- Paperwork for your tax return: invoices, proof of payment and both certificates.
Examples
The deduction is 50% of what you pay, capped at €10,000 of investment per year:
| Investment | Deduction base | Income-tax deduction |
|---|---|---|
| €8,000 | €8,000 | €4,000 |
| €10,000 | €10,000 | €5,000 (maximum) |
| €14,000 | €10,000 (cap) | €5,000 (maximum) |
Combining it with other incentives
Article 3 says nothing about combining this deduction with the FACTOR grant or with the Spanish state deduction for energy-efficiency works (20%, 40% or 60%, in force for works completed by 31 December 2026). They are separate measures, one regional and one national, but how they combine in your return depends on your situation. Ask us and check with your tax adviser before counting on both.
Two practical tips
Indicative information based on Article 3 of Legislative Decree 1/2014 of the Balearic Islands (BOE consolidated text as of 13 June 2026). It does not replace tax advice: check your case with your adviser.
- Pay by bank transfer or card and keep the invoice in your name. Other deductions in the same law require traceable payment; it is wise to do it always.
- Get the energy certificate before work starts. It is the step that most often costs people the deduction.
Indicative information. Grants and prices change; please confirm with us before deciding.