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V1965-24 17 September 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · imputación de rentas inmobiliarias

No imputed real estate income for properties under construction or those unfit for use due to urban planning restrictions

A taxpayer inquired whether real estate income imputation applies to a property scheduled for demolition to make way for new construction. The Directorate General for Taxes (DGT) ruled that imputation is not applicable if it is proven that the property is unfit for use.

The question raised

Whether the imputation of real estate income is applicable for the purposes of Personal Income Tax.

The DGT's ruling

According to Article 85.1 of the Personal Income Tax Law (LIRPF), no income shall be imputed for real estate under construction or when, due to urban planning reasons, the property is not capable of being used. To this end, the taxpayer must prove the impossibility of use through any means of evidence admitted in Law. In properties in a ruinous state or under construction, it shall be decisive to demonstrate that they are not capable of being used.

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