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V1838-24 1 August 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · pacto de mejora

No capital gains or losses on the transfer of assets through succession improvement pacts

A query was raised regarding whether the transfer of real estate interests through an improvement pact in favour of children is subject to Personal Income Tax (IRPF). The Directorate General for Taxes (DGT) ruled that these transfers are considered gratuitous transfers by reason of death, meaning no capital gain or loss arises.

The question raised

The taxation under Personal Income Tax of the transfer through an improvement pact in favor of children of a percentage of their participation is questioned.

The DGT's ruling

The transfer of assets through an improvement pact is integrated into the consideration of a gratuitous transfer mortis causa under Article 33.3.b) of the Personal Income Tax Law. This applies even if the death of the transferor has not occurred. Consequently, no capital gain or loss is deemed to exist in such operations.

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