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V1566-17 19 June 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Reinvestment exemption unavailable if more than two years have passed since property ceased to be a primary residence

A taxpayer sold a property that ceased to be their primary residence in 2010 after it had been rented out. The DGT ruled that the reinvestment exemption cannot be applied because the sale occurred more than two years after the property stopped being their habitual residence.

The question raised

Whether it is possible to avail of the exemption for reinvestment in the primary residence and, if so, the period for reinvestment.

The DGT's ruling

To apply the exemption for reinvestment in the primary residence, the building must have been the taxpayer's residence for at least three years. Furthermore, the primary residence is deemed to be transferred if it constitutes their residence at that time or if it was so up to any day within the two years prior to the date of transfer. In this case, as more than two years have elapsed since the dwelling ceased to be a primary residence, the exemption is not applicable.

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