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V0187-21 4 February 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · renta vitalicia

Acquisition value of a property obtained via life annuity is its market value at the date of transfer

A taxpayer has enquired about how to calculate the acquisition value of a property obtained through a life annuity to determine capital gains upon its sale. The Directorate General for Taxes (DGT) clarifies that the acquisition value is the market value of the property at the time of the original transfer.

The question raised

Acquisition value of the dwelling for the purposes of calculating the capital gain or loss obtained in the Personal Income Tax.

The DGT's ruling

Upon the termination of a life annuity, the gain or loss is calculated as the difference between the acquisition value of the capital received and the annuities paid. For the subsequent transfer of the dwelling, the acquisition value shall be its market value at the time the transfer was effected, plus investments, improvements, and expenses inherent to the acquisition.

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