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V1829-19 ·15 July 2019 ·consulta-vinculante Medium impact
Tax

Down payments cannot be declared as capital losses unless contract termination results in the loss of those amounts

A taxpayer inquired whether a loss of 75,022 euros, stemming from payments made to a developer for the purchase of three flats, affects their Personal Income Tax (IRPF). The Directorate General for Taxes (DGT) responded that a capital loss cannot be established as there is no evidence of the contracts being terminated with the loss of said amounts.

In 4 key points

How it affects those involved

This ruling clarifies that mere payments made towards a purchase do not constitute a capital loss for tax purposes unless the underlying contract is formally terminated and the funds are lost as a result.

Lifecycle

2019-07-15PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

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This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
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