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V2570-14 1 October 2014 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ITPAJD · propiedad horizontal

Conversion of private property into a common element is subject to ITPAJD or ISD depending on the legal instrument used

A homeowners' association has requested clarification regarding the taxation of the free transfer of a semi-basement (erroneously registered as the developer's private property) to convert it into a common element. The DGT indicates that the transfer of ownership must be taxed under ITPAJD or ISD, whereas the modification of participation coefficients does not trigger the tax.

The question raised

Taxation of the operation.

The DGT's ruling

The conversion of a developer's private property into a common element of the community constitutes a transfer of real estate. This must be taxed under the onerous transfers modality of the ITPAJD or under Inheritance and Gift Tax, depending on the legal instrument used, unless an exemption due to the rectification of the ineffectiveness of previous acts is demonstrated. On the other hand, the variation of participation coefficients does not trigger the gradual quota of Documented Legal Acts if the surface areas of the apartments and premises are not altered, as it does not have as its object a valuable quantity or thing.

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