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V0412-16 3 February 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · devengo

Accrual of income from compulsory purchase occurs upon transfer of risks and benefits of ownership

The applicant asks when the benefit from a compulsory purchase accrues and how the resolution of litigation regarding the price affects this. The DGT rules that the transfer occurs upon occupation and that any price difference resulting from a final judgment is integrated into the period in which said judgment is notified.

The question raised

1) When the accrual is understood to have occurred in Corporate Income Tax as the benefit of the expropriation.

The DGT's ruling

Income from an expropriation is included in the period in which the risks and benefits of ownership are transferred, which occurs upon taking possession through the occupation deed. If the price is appealed, the difference between the initial fair value and that fixed by judgment accrues in the period in which the judgment becomes final following its notification. Late payment interest must be reflected in the fiscal year in which it accrues according to financial criteria.

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