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V2929-21 19 November 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancia patrimonial

Capital gains from selling a primary residence over age 65 may be exempt from Income Tax

A taxpayer has enquired whether capital gains from the sale of their primary residence upon reaching age 65 are exempt. The Directorate General for Taxes (DGT) indicates that the exemption applies if the property is the taxpayer's primary residence and they are either over 65 years of age or in a state of dependency.

The question raised

Whether, in the tax year in which the disposal of said real estate occurs, the capital gain derived from its transfer would be exempt from Personal Income Tax (IRPF).

The DGT's ruling

The transfer of the primary residence by persons over 65 years of age is exempt from capital gains tax pursuant to Article 33.4.b) of the Personal Income Tax Law (LIRPF). For this to apply, the building must be the primary residence at the time of the transfer or have been so during the two preceding years. A primary residence is defined as the residence for a continuous period of at least three years, except in justified circumstances involving a change of domicile.

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