Skip to content
Back to index
V3570-20 16 December 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancia patrimonial

Capital gains arise if a co-owner receives an asset worth more than their share upon dissolution of a community of property

Siblings dissolve a community of property regarding an inherited property, where one sibling retains the asset and compensates the others in cash. The DGT rules that this generates a capital gain or loss for the siblings receiving the compensation.

The question raised

Taxation of the operation for Personal Income Tax purposes. Specifically, regarding the taxation of the amounts received by siblings who transfer their undivided interest in a property in exchange for monetary compensation. It is also requested to know whether any deduction or exemption applies as they are all over 65 years of age.

The DGT's ruling

The dissolution of a community of property does not alter the assets if the allocation conforms to the ownership share and market value. If an asset is allocated at a value higher than the share of the other co-owners, an alteration of assets occurs, resulting in a gain or loss for them. The exemption for persons over 65 years of age only applies if the transferred property is considered a primary residence.

Book your free first meeting