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A query was raised regarding whether the capital gain arising from transferring a primary residence to settle a mortgage debt is exempt if the creditor is a third party that has subrogated into the credit. The Directorate General for Taxes (DGT) ruled that the exemption applies provided all legal requirements are met, even if the creditor is not the original lending institution.
This ruling provides legal certainty for homeowners who settle mortgage debts through a transfer of property (dación en pago) to entities other than their original bank, confirming that tax exemptions for primary residences remain intact.
The tax team reviews your specific situation.
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