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V2476-20 21 July 2020 · SG de Tributos Locales Criterion in force
OTRO · iivtnu

Creation of a life usufruct on urban property triggers IIVTNU, but consolidation upon death does not

The taxpayer asks whether donating a life usufruct of a property to his father triggers the tax on the increase in value of urban land (IIVTNU). The DGT rules that while the creation of the usufruct does trigger the tax, the subsequent consolidation of full ownership due to the death of the usufructuary does not.

The question raised

It is asked whether such a donation triggers the accrual of the tax.

The DGT's ruling

The creation of a real right of enjoyment, such as life usufruct, over urban land constitutes the taxable event for the IIVTNU. The taxable person is the individual in whose favor the right is created. However, when the usufructuary dies and the bare owner recovers full ownership, no new taxable event occurs because there is no transfer nor a new creation of a right, but rather the recovery of a right that already belonged to the holder.

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