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V0704-16 23 February 2016 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ITPAJD · permuta

Exchange of co-ownership shares in properties constitutes a barter subject to ITP and AJD

A taxpayer inquired whether two siblings should use a gift or a sale to cease being co-owners of two properties. The DGT stated it cannot decide which option is better from a civil law perspective, but clarified that the exchange of shares constitutes an onerous barter.

The question raised

Whether said operation can be carried out by means of a donation, paying the corresponding Inheritance and Gift Tax, or whether it must be carried out by means of a sale and purchase, settling the Transfer Tax and Stamp Duty, in addition to, in both cases, the Tax on the Increase in Value of Urban Land.

The DGT's ruling

The DGT cannot rule on the civil expediency of opting for a donation or a sale and purchase. However, if the co-owners exchange the percentages they hold in one property for those of another property, a barter occurs. As it is an onerous transfer, it must be taxed under the modality of onerous property transfers of the ITP and AJD.

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