When people look into solar incentives in Spain, regional grants get most of the attention. But for a private homeowner in the Balearic Islands, the most reliable savings in 2026 come from somewhere else: municipal rebates on the IBI property tax and the ICIO works levy, plus the Spanish income tax deduction. They do not depend on a call with a limited budget, they never run out, and they can be combined.
The three tax-saving routes
- IBI (annual property tax). Most Balearic municipalities cut the bill by 25% to 50% for 3 to 5 years for homes with solar systems.
- ICIO (construction levy). Paid when the works licence or prior notification is filed, it can be reduced by up to 95% depending on the municipality.
- IRPF (income tax). Works that improve a home’s energy efficiency qualify for a deduction of up to 60%, within the limits and energy certificates set by national rules. This one applies only to tax residents in Spain.
IBI rebates by municipality
These are the indicative values under the current ordinances in the main municipalities where we work. Every town hall reviews its tax ordinance annually, so confirm the figure when you apply.
| Municipality | Island | IBI rebate | Duration |
|---|---|---|---|
| Palma | Mallorca | 50% | 3 years |
| Manacor | Mallorca | 50% | 3 years |
| Llucmajor | Mallorca | 50% | 3 years |
| Inca | Mallorca | 30% | 5 years |
| Calvià | Mallorca | 25% | 3 years |
| Maó | Menorca | 50% | 4 years |
| Ciutadella | Menorca | 50% | 3 years |
To put it in perspective: on a home paying 600 euros of IBI per year, a 50% rebate over 3 years means 900 euros of direct savings, before counting the ICIO or the income tax deduction.
How to claim it (it does not arrive on its own)
The IBI rebate is never automatic: it is granted on request. The usual process looks like this:
- Installation and registration. The system is legalised and the electrical installation certificate is issued.
- Application to the town hall. You submit the certificate, the invoice and the technical documentation.
- Effect on the next bill. Applications filed before year end usually apply to the following year’s bill.
At VATSOLAR we handle this paperwork as part of the installation: certificates, the reduced ICIO request before the works and the IBI application once the system is registered.
What about the 2026-2027 regional grants?
The Balearic call published in the official bulletin (BOIB) in July 2026 covers photovoltaics, batteries, aerothermal systems and private EV charging, with a deadline of 28 February 2027. However, private individuals and self-employed persons acting as individuals cannot apply to the photovoltaic programme, which is reserved for companies, owner communities and other eligible entities. The battery, aerothermal and EV charging programmes do accept them. You will find the full details, requirements and percentages per applicant type in our guide to the Balearic energy grants 2026-2027.
The practical takeaway: if you are a private homeowner expecting a direct subsidy for the panels, the real savings route is tax-based. And it is a good route: between the ICIO, the IBI and the IRPF, the effective reduction on the installation cost is substantial, with no waiting lists and no budgets that run dry.
What the installation itself costs and saves
Tax savings are the complement; the bulk of the savings comes from the installation itself, which in the Balearics produces around 1,550 kWh per year for every kW installed. With our configurator you can find out in one minute what capacity you need, what it costs and how much energy it would produce on your roof, without waiting for a call. The technical visit then confirms the final figure and prepares the documentation for every rebate covered in this article.
