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V2607-23 27 September 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Reinvestment exemption denied if the sold property was not the main residence in the previous two years

A taxpayer resident in Spain inquired whether they could apply the reinvestment exemption when selling their former home in Scotland to purchase a new one in Valladolid. The Directorate General for Taxes (DGT) ruled that this is not possible because the property sold was neither their main residence at the time of sale nor during the preceding two years.

The question raised

Whether the exemption for reinvestment in the habitual residence would be applicable in the case of the sale of their property in Scotland and reinvestment in a property in Valladolid.

The DGT's ruling

To apply the reinvestment exemption, the transferred property must be the taxpayer's habitual residence at the time of sale or have been so during the two preceding years. Habitual residence requires continuous residence for at least three years, unless circumstances such as a job transfer occur that justify a change of domicile before said period. In this case, as the taxpayer has not resided in the property since 2013, the habitual residence requirement for the exemption is not met.

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