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V2940-20 30 September 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancia patrimonial

Allocation of assets exceeding ownership share triggers capital gain or loss

A query was raised regarding whether the dissolution of a co-ownership (condominium) results in taxation when one co-owner receives both the property and financial compensation. The DGT ruled that if the allocation exceeds the individual's ownership share, it constitutes an asset alteration subject to Personal Income Tax (IRPF).

The question raised

Whether the capital gain derived from the dissolution of a co-ownership is subject to Personal Income Tax (IRPF).

The DGT's ruling

The dissolution of a community of property does not alter the composition of the assets if the allocation conforms to the ownership share. However, if assets are allocated at a value higher than that corresponding to the share, an alteration of assets occurs, generating a gain or loss. In this case, the difference between the acquisition value and the transfer value shall determine the capital gain or loss, regardless of whether there is cash compensation.

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