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V1855-19 16 July 2019 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ITPAJD · exceso de adjudicación

Dissolution of a joint property community attracts AJT if excess adjudication is unavoidable

The applicant asks whether the dissolution of a joint property community involving excess adjudication is subject to Stamp Duty (AJD) or Transfer Tax (ITP). The DGT rules that it depends on whether the excess is unavoidable due to the indivisibility of the assets or if it can be avoided through a different distribution.

The question raised

Whether in the proposed operation a cessation of the pro indiviso occurs regarding each of the estates, whereby the adjudicatee thereof must pay Stamp Duty (AJD) at a rate of 1.5%, or whether, conversely, a sale and purchase occurs, whereby the acquirer of the estates must pay Transfer Tax (ITP) at a rate of 8 or 10 percent, as the case may be.

The DGT's ruling

If the dissolution of the community does not generate excess adjudication, it is only subject to Stamp Duty (AJD). If an excess exists, it shall be subject to Transfer Tax (ITP) if it can be avoided through an adjudication that minimizes it. It shall only be subject to the variable rate of Stamp Duty (AJD) if the excess is unavoidable due to the indivisibility of the set of assets or their impairment through division, provided that it is adjudicated to a single co-owner and compensated in cash.

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