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A query was raised regarding whether the exemption for the transfer of a primary residence in satisfaction of a debt applies when the property is transferred to an entity other than the creditor. The Directorate General for Taxes (DGT) ruled that the exemption is applicable if the creditor mandates the transfer to a third party to settle the debt.
This ruling provides legal certainty for taxpayers who, under creditor instruction, transfer their main home to a third party to discharge a mortgage, ensuring they can still benefit from the relevant Income Tax exemptions.
The tax team reviews your specific situation.
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