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V0202-23 8 February 2023 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
OTRO · extinción de condominio

Extinction of co-ownership with financial compensation subject to AJD rather than onerous transfers

A taxpayer seeks to dissolve a co-ownership of a property by acquiring full ownership and compensating the other co-owners with cash (both lump sum and in instalments). The DGT rules that, as this is a dissolution involving an excess of adjudication compensated by payment, it does not constitute an onerous transfer but is instead subject to Stamp Duty (AJD).

The question raised

Taxation upon the extinction of co-ownership.

The DGT's ruling

The dissolution of a community of property through the adjudication of an indivisible real estate asset to a single co-owner, who compensates for the excess in cash, does not constitute an onerous transfer of assets pursuant to art. 7.2.B of the TRLITPAJD. The transaction is subject to the gradual rate of documented legal acts (AJD). The tax base shall be the value of the portion acquired ex novo, pursuant to art. 30 of the TRLITPAJD.

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