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A married couple inquired about the amount they must reinvest in a new property to ensure the capital gains from the sale of their previous home remain exempt, noting their intention to pay off the new mortgage. The Directorate General for Taxes (DGT) ruled that to qualify for a full exemption, the total amount obtained from the sale must be reinvested.
Taxpayers seeking full exemption from capital gains tax on the sale of their primary residence must reinvest the entire sale proceeds rather than just the difference in value or using the funds for mortgage repayments.
The tax team reviews your specific situation.
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