Acquisition value of inherited investment funds for Personal Income Tax (IRPF)

Determining the acquisition value is a critical element when selling financial assets, as the amount of capital gain or loss to be taxed in the Personal Income Tax (IRPF) depends on this data. A recent binding ruling from the Dirección General de Tributos (DGT) has clarified the treatment applicable to investment fund units acquired through inheritance.

What the DGT has ruled

The DGT has established that, for investment fund units obtained through inheritance, the acquisition value is composed as follows:

• The sum of the value resulting from applying the rules of Inheritance and Gift Tax, provided it does not exceed the market value.
• The expenses and taxes inherent to the acquisition.

It is important to highlight that, in this scenario, the rule allowing the declared value to prevail if it is higher than the market value is not applicable. The Administration's criteria is restrictive: the acquisition value cannot exceed the market value. Likewise, the calculation of this value must be carried out proportionally to the percentage of the units that have been inherited.

What it means for you

If you have received investment fund units through succession, the calculation of your profit when selling them will not be based simply on the value appearing in your inheritance tax return if that value were higher than the market value. The acquisition value will be limited by the market value of said units at the time of the transfer.

This criterion directly affects individuals wishing to liquidate their positions in inherited funds, as a lower acquisition value will imply a higher taxable base in the income tax return by generating a larger capital gain.

What you should do

In the event of a possible sale of inherited financial assets, it is necessary to perform a precise calculation that integrates both the Inheritance and Gift Tax rules and the associated expenses, always respecting the market value limit. It is recommended to verify the inheritance documentation and the market values of the units to ensure that the capital gain calculation is correct in accordance with Law 35/2006 on IRPF. Each wealth situation requires a detailed analysis of the values applied at the time of the transfer.