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V2766-20 10 September 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancia patrimonial

Awarding a common asset to a co-owner via financial compensation generates a capital gain

A taxpayer inquired whether awarding a property of which they are a co-owner to the other co-owner, by compensating them in cash for their share, triggers taxation. The Directorate General for Taxes (DGT) ruled that such an operation constitutes a change in assets that generates a capital gain or loss.

The question raised

Taxation under Personal Income Tax (IRPF) of the described alternatives.

The DGT's ruling

The division of common property does not alter the composition of the assets if the allocations correspond to the ownership share. However, a capital gain will occur if, upon dissolving the joint ownership, it is agreed to allocate the asset to one of the parties by compensating the other in cash. In this case, the former spouse will generate a capital gain or loss for the portion of the real estate transferred, which will be integrated into the savings tax base.

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