Acquisition value for Personal Income Tax (IRPF) will be the actual purchase amount

The calculation of capital gains or losses in the sale of real estate depends directly on the correct determination of the acquisition value. An error in this amount can lead to an incorrect settlement of Personal Income Tax (IRPF) at the time of the transfer.

What the DGT has ruled

The Dirección General de Tributos (DGT) has specified the criteria applicable to determine this value according to current regulations. The acquisition value must consist of the actual purchase amount, plus the expenses, investments, and taxes inherent to the transaction.

However, there is a relevant exception: if the corresponding Autonomous Community performs a value verification to verify the amount declared in the Transfer Tax (ITP), the value resulting from said verification shall be the one used for IRPF. In the absence of this administrative verification procedure, the actual acquisition amount must be strictly applied in accordance with the provisions of Articles 34 and 35 of the Law of IRPF (LIRPF).

What this means for you

If you are a property owner and plan to sell, the base upon which you will calculate your tax benefit is not always the same. If the administration has not intervened to validate the transaction value in the transfer tax, you have the right to use the actual cost of the operation (including expenses and taxes paid at the time) to reduce the taxable base of the capital gain.

This criterion is especially relevant for individuals and residents or non-residents who own real estate assets in Spain, as a correct determination of the acquisition value allows for the avoidance of an excessive tax burden due to an inflated capital gain.

What you should do

It is necessary to keep all documentation that proves the actual purchase amount, as well as receipts for the expenses, investments, and taxes that were part of the acquisition cost. In the event that the Autonomous Community has performed a value verification in the past, you must verify what the resulting amount was, as that will be the mandatory value for the future IRPF declaration.