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V1178-21 29 April 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Lack of space is not generally considered a circumstance that necessarily requires a change of residence for the reinvestment exemption

A taxpayer asks whether her home can be considered a habitual residence to apply the reinvestment exemption after having left it due to a lack of space. The DGT responds that the lack of space is not a circumstance that necessarily requires a change of domicile.

The question raised

Possibility of considering that the dwelling to be transferred has attained the status of habitual residence given the circumstances of lack of space. And, thus, being able to avail of the reinvestment exemption in a habitual residence.

The DGT's ruling

To apply the exemption, the dwelling must be the habitual residence for at least three continuous years. A change of domicile due to lack of space is considered a voluntary act and not a circumstance that necessarily requires a change of residence. Therefore, if it is sold before completing three years of continuous residence following the return, it will not be considered a habitual residence, unless an analogous circumstance that compels the change is proven.

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