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V1802-25 13 October 2025 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Reinvestment exemption not applicable if property sold was not habitual

A taxpayer asks whether the reinvestment exemption applies after selling a property ceased to be their habitual residence in 2020 due to a job transfer. The DGT responds that it is not possible because the property did not meet the requirement of being the habitual residence at the time of sale or in the two years prior.

The question raised

Possibility of applying the exemption for reinvestment in the habitual residence under Article 38 of the Personal Income Tax Law (LIRPF).

The DGT's ruling

To qualify for the exemption, the transferred property must be the habitual residence at the time of sale or must have been so during the two preceding years. A job transfer allows a residence of less than three years to be considered a habitual residence, but this does not apply if residency has already ceased prior to the two-year period preceding the transfer. In this case, as the property was vacated in 2020 and sold in 2024, the requirement of habitual residence is not met.

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