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V2434-14 15 September 2014 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ITPAJD · exceso de adjudicación

Allocation of an indivisible property to a co-owner is not subject to transfer tax

A query was raised regarding whether the allocation of an indivisible property to a single co-owner, with the other being compensated in cash, is subject to tax on excess allocation. The DGT ruled that it is not subject to transfer tax (ITPO) as the excess is unavoidable, nor to stamp duty (AJD) if the transaction is recorded in a judicial document.

The question raised

Whether the proposed operation, given that the excess produced in the adjudication is inevitable, would be subject to and not exempt from the Documented Legal Acts modality, with the general rate of 1.5% being applicable.

The DGT's ruling

The excess in the adjudication of an indivisible property (or one that would be significantly diminished by its division) is not subject to the onerous transfer of assets modality of the ITPAJD, as it is considered an inevitable excess according to article 1,062 of the Civil Code. Likewise, the variable rate for documented legal acts shall not apply if the document is not the first copy of a public deed, as is the case with judicial documents.

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