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V0153-14 23 January 2014 · SG de Tributos Locales Criterion in force
OTRO · iivtnu

IIVTNU is payable even if the sale price is lower than the acquisition cost

A query was raised regarding whether the IIVTNU (Tax on the Increase in Value of Urban Land) applies when an urban property is sold for less than its purchase price. The DGT ruled that the tax is calculated using an objective method based on the cadastral value rather than the actual capital gain.

The question raised

Whether liability for the IIVTNU arises in the event of a transfer of urban real estate at a price lower than the acquisition price.

The DGT's ruling

The taxable base of the IIVTNU is determined by applying to the cadastral value of the land a percentage that multiplies the municipal coefficient by the number of years elapsed. This method is an objective valuation rule and not a presumption, and therefore does not admit evidence to the contrary. The tax levies the increase in value derived from urban planning action and not the real capital gain obtained by the individual.

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