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V0038-17 11 January 2017 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ITPAJD · dación en pago

Transferring property to settle debt following dissolution of community property regime is not exempt from ITP

A taxpayer inquired whether transferring a property to settle a debt arising from the liquidation of a community property regime (dissolved in 2003) was exempt from Transfer Tax (ITP). The Directorate General for Taxes (DGT) ruled that the transaction constitutes a 'dation in payment' independent of the dissolution and is therefore subject to tax.

The question raised

Whether the transfer of the real estate property shall be exempt from the Transfer Tax and Stamp Duty pursuant to Article 45.I.B.3 of the TRLITPAJD.

The DGT's ruling

The settlement of a debt through dation in payment constitutes a legal act independent of the dissolution of the community property regime. Although the debt arises from the dissolution, the transfer of an asset to extinguish the obligation is a dation in payment pursuant to Article 7.2.A of the TRLITPAJD. Therefore, it is not possible to apply the exemption under Article 45.I.B.3 to this subsequent and independent act.

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