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V1112-17 10 May 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Reinvestment exemption denied if sold property was not the primary residence for at least three continuous years

A taxpayer inquired whether a property sold could be classified as a primary residence to qualify for the reinvestment exemption. The Directorate General for Taxes (DGT) ruled that it does not, as the requirement of continuous residence for at least three years prior to the sale was not met.

The question raised

Whether the property transferred by the taxpayer can be classified as a primary residence under Article 41 bis of the RIRPF, for the purposes of applying the reinvestment exemption.

The DGT's ruling

For the reinvestment exemption, the transferred property must be the primary residence, defined as the building that constitutes the residence for a continuous period of at least three years. It is also considered a primary residence if it held such status during the two years prior to the transfer. In this case, as there has not been continuous residence for at least three years since April 2012, the property does not qualify as a primary residence.

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