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V2581-20 29 July 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · deducción por inversión en vivienda habitual

Reinvestment exemption applicable if new home was purchased up to two years before selling the previous one

The taxpayer asks whether they can maintain the primary residence tax relief until their flat is sold and if the reinvestment exemption applies if the new home was purchased before the sale of the old one. The DGT rules that the tax relief is lost upon ceasing to reside in the property and that the exemption is applicable if the purchase was made within the two years preceding the sale.

The question raised

1.- Whether, until August 2020, as long as they continue residing in the apartment, they have the right to continue applying the deduction for the amounts paid for said apartment up to that date.

The DGT's ruling

The deduction for investment in the primary residence may continue to be applied as long as the property constitutes the taxpayer's residence and primary home. For the reinvestment exemption, the new residence must have been acquired within a period not exceeding two years prior to the transfer of the former. As money is a fungible asset, it is sufficient that the amount obtained from the sale serves to replace the savings invested in the new residence or to amortize its mortgage loan.

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