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V2254-21 12 August 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancia patrimonial

Transferring property via legacy of third-party goods generates capital gains or losses for Income Tax purposes

A query was raised regarding whether the transfer of a flat to a sister, mandated by a legacy from a deceased mother, is subject to Personal Income Tax (IRPF). The Directorate General for Taxes (DGT) ruled that the transferor must report the resulting capital gain or loss within the savings tax base.

The question raised

Whether tax must be paid under Personal Income Tax for the capital gain obtained in the transfer of the real estate when delivered by virtue of a legacy.

The DGT's ruling

The transfer of real estate by the heir to the legatee generates a capital gain or loss as a variation in their assets occurs. For transfers for consideration, the acquisition and transfer values shall be determined in accordance with the rules of the Inheritance and Gift Tax, without exceeding the market value. The heir is taxed under Personal Income Tax on the difference in values, whereas the legatee is taxed solely under the Inheritance and Gift Tax for the acquisition of the asset.

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