Back to index
V0274-18 7 February 2018 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ITPAJD · reducción fiscal

Five-year ownership period required to retain tax reduction on agricultural property

An agricultural company enquired whether it could transfer a property acquired with tax benefits without losing the exemption. The DGT ruled that ownership must be maintained for five years to avoid having to repay the reduction and pay interest.

The question raised

Whether the ownership of the aforementioned estate must be maintained for five years to avoid losing the right to the deduction or if, conversely, it may be transferred as the referred maintenance obligation does not exist and, if such an obligation exists, whether, in the event of a transfer, the taxpayer should proceed to regularize their tax situation with the Regional Tax Administration for not having maintained ownership of the estate during that period.

The DGT's ruling

The acquisition of an estate with the reduction provided for in Law 19/1995 obliges the acquirer not to sell, lease, or transfer the estate during the following five years. If a transfer is carried out, except due to force majeure, the payment of the tax that was not paid must be justified, along with late payment interest, to the Regional Tax Administration.

Book your free first meeting