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V1385-20 13 May 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancia patrimonial

Reinvestment exemption unavailable if property ceased to be primary residence more than two years before sale

A taxpayer inquired whether they could apply for the reinvestment exemption following the auction sale of a property after a divorce. The DGT ruled that the exemption does not apply because the property ceased to be the primary residence when use was awarded to the former spouse in 2013.

The question raised

Whether a capital gain or loss occurs, and if applicable, whether for the purposes of the reinvestment exemption, the reinvestment period may commence from the date of the response to this consultation, or failing that, from the date of the aforementioned scheduling order.

The DGT's ruling

To apply the reinvestment exemption, the transferred property must have been the primary residence at the time of sale or on any day during the two years prior. In this case, the property ceased to be the primary residence in November 2013 upon the issuance of the divorce decree that awarded use to the former spouse. As the property was sold in 2018, the requirement of primary residence in the two years preceding the transfer is not met.

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