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V2111-20 24 June 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Reinvestment exemption requires legal acquisition of new home within two years

The taxpayer asks whether they can apply for the reinvestment exemption after purchasing land to build a home. The DGT rules that legal acquisition must take place within the two-year period, noting that for self-build projects, the completion of works is considered the date of acquisition.

The question raised

Application of the exemption for capital gains obtained from the sale of one's former primary residence through reinvestment in a new one.

The DGT's ruling

For the exemption, the legal acquisition of the new dwelling must occur within the period of two years prior to or following the transfer of the previous one. In cases of direct execution of works (self-promotion), the acquisition date is the completion of the works. If such date cannot be proven, the date of the deed of declaration of new construction shall be taken. The calculation of periods was suspended between March 14 and May 30, 2020, due to COVID-19 regulations.

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