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V3129-21 17 December 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · nuda propiedad

Donating bare ownership of a property generates a capital gain or loss for Income Tax purposes

A query was made regarding the Income Tax (IRPF) treatment of donating the bare ownership of a property to a child. The Directorate General for Tax (DGT) ruled that this transaction generates a capital gain or loss as it alters the composition of the taxpayer's assets.

The question raised

Taxation of the donation under Personal Income Tax.

The DGT's ruling

The capital gain or loss is quantified by the difference between the transfer value of the bare ownership (in accordance with Inheritance and Gift Tax regulations) and the acquisition value corresponding to said bare ownership. If a gain is generated, it is included in the savings tax base. In the event of a capital loss, it shall not be deductible as it constitutes a gratuitous transfer.

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