Skip to content
Back to index
V1260-24 31 May 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancia patrimonial

Reinvestment exemption requires full ownership of the property for at least three years

A taxpayer inquired whether the sale of part of their property (a registered estate used as a courtyard) is exempt from Personal Income Tax (IRPF) if the proceeds are reinvested in another primary residence. The Directorate General for Taxes (DGT) stated that to qualify for the exemption, the taxpayer must have held full ownership of the property for at least three continuous years.

The question raised

Whether the possible capital gain generated in the transfer of the segregated part of the dwelling is exempt for Personal Income Tax (IRPF) purposes.

The DGT's ruling

To apply the exemption for reinvestment, the transferred property must have been the habitual residence for at least three continuous years since its acquisition by the taxpayer, counting only the period during which full ownership is held. In the case of annexes or parts that do not constitute the dwelling itself, for their sale to be exempt, their acquisition must have been carried out jointly with the dwelling. The classification of the building as a dwelling does not depend on its urban planning classification, but it must be conditioned or capable of being conditioned as such.

Book your free first meeting