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V0838-20 14 April 2020 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · ganancia patrimonial

Reductions for seniority or life annuity reinvestment exemptions may apply when selling property

A taxpayer over 65 has enquired about calculating capital gains from the sale of a property acquired in 1981. The DGT explains the calculation method for such gains and the options for applying seniority-based reductions or exemptions through the establishment of a life annuity.

The question raised

1. Calculation of capital gains.

The DGT's ruling

Capital gains represent the difference between the transfer value and the acquisition value. For real estate acquired before December 31, 1994, a reduction may be applied to the portion of the gain generated before January 20, 2006, pursuant to the ninth transitional provision. Furthermore, individuals over the age of 65 may exclude the gain from taxation if they allocate the sale proceeds to establish a life annuity within a period of six months, subject to a limit of 240,000 euros.

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