Skip to content
V1941-21 ·21 June 2021 ·consulta-vinculante Medium impact
Tax

Dissolution of joint property ownership is not subject to Income Tax or Property Transfer Tax if allocation is proportional

A taxpayer and his brother wish to dissolve a co-ownership of five urban properties by allocating full ownership to each party on a proportional basis. The DGT rules that the operation does not constitute a transfer for Property Transfer Tax (IIVTNU) or Income Tax (IRPF) purposes, but warns of potential tax liability for Transfer Tax (ITP) if the transaction is treated as a barter or if there are excesses in the allocation.

In 6 key points

How it affects those involved

This ruling provides legal certainty for taxpayers dissolving co-ownerships, confirming that proportional division avoids capital gains tax and property transfer tax, provided no unequal distribution of assets occurs.

Lifecycle

2021-06-21PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

Does this provision affect you?

The tax team reviews your specific situation.

Talk to the tax team
This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
Email
Contact