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V1959-17 20 July 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · cesión de cartera

Transfer of an insurance portfolio is classified as a capital gain rather than remuneration for services

An insurance agent enquired whether the transfer of her portfolio upon retirement constitutes an economic activity or a transfer of assets. The DGT has ruled that it is a transfer of rights and, therefore, is not subject to personal income tax (IRPF) withholding.

The question raised

Classification of the operation carried out and whether the payments to be made by the buyer of the portfolio are subject to withholding tax under Personal Income Tax.

The DGT's ruling

The transfer of an insurance portfolio constitutes the transfer of an asset used in the economic activity. Therefore, the consideration received is considered a capital gain or loss and not remuneration for professional services. As it is not income subject to withholding under the Personal Income Tax Regulations, the buyer is not required to apply a withholding tax.

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