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V3029-23 21 November 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
OTRO · proindiviso

Dissolution of joint ownership with excess allocation compensated in cash is subject to AJD rather than TPO or IIVTNU

Two siblings wish to dissolve a co-ownership of four inherited properties, allocating unequal lots with financial compensation. The DGT has determined that the operation does not constitute an onerous transfer nor does it trigger capital gains tax, but is instead subject to Stamp Duty (AJD).

The question raised

Taxation of the operation in the Transfer Tax and Documented Legal Acts Tax, in the Tax on the Increase in Value of Urban Land, and in the Personal Income Tax.

The DGT's ruling

The dissolution of the community with excess adjudication compensated in cash, under the assumption of the indivisibility of the asset (Art. 1.062 CC), does not constitute an onerous transfer for ITPAJD purposes nor a taxable event for IIVTNU purposes. The operation shall be taxed solely under the modality of documented legal acts. In IRPF, the adjudication of assets with a value exceeding the participation share generates a capital gain or loss for the co-owner receiving the excess or the one receiving less.

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