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V0524-22 14 March 2022 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · división de la cosa común

Capital gains or losses arise if asset allocation in the division of common property exceeds ownership shares

Several co-owning heirs of a property wish to dissolve the co-ownership by allocating the asset to one of them through financial compensation. The DGT indicates that the division of common property does not constitute a change in assets if allocated according to ownership shares, but it does generate tax results if assets are allocated at a value exceeding each individual's share.

The question raised

Taxation of the operation under Personal Income Tax.

The DGT's ruling

The dissolution of a community of property and the allocation according to the ownership share does not constitute a capital gain or loss. However, if assets are allocated at a value higher than that corresponding to the ownership share, a capital gain or loss occurs for the other co-owners. This generates a capital gain or loss, regardless of whether there is cash compensation, and the amount shall be determined by the difference between the acquisition and transfer values.

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