Owners of properties held in co-ownership cannot claim exclusive ownership

Determining who must be taxed on a capital gain from the sale of a property does not depend solely on the will of the parties expressed in private agreements, but on the legal ownership formally recorded in the property documents.

What the DGT has resolved

The Dirección General de Tributos (DGT) has established that the taxation of income is subject to the ownership of the property according to the rules of legal ownership. In the case analyzed, there was a contradiction between a private contract and the 2025 sale deed, which reflected that both spouses were owners of one half each under a regime of co-ownership (proindiviso).

The advisory body has clarified that it does not have the competence to assess or confirm contradictions between the contractual status declared by the taxpayer and other agreements that may deny it. Therefore, if the public deed establishes co-ownership, that condition is what governs the legal status of the asset.

What this means for you

If you are a property owner, the way the purchase and sale deed is drafted is decisive for your Personal Income Tax (IRPF) declaration. The existence of a private contract intended to assign exclusive ownership to a single person has no effect against the Administration if the public deed indicates that the property belongs to several owners in co-ownership.

This implies that the capital gain derived from the sale must be distributed and taxed according to the legal ownership recorded in the notarial document, regardless of what the parties have agreed upon privately.

What you should do

When selling a real estate asset, it is necessary to verify that the legal reality of the property coincides with the parties' intention regarding the taxation of income. Consistency between private agreements and the public deed is fundamental to avoid discrepancies with the Tax Agency in the determination of capital gains.

Each situation of co-ownership or proindiviso must be analyzed with technical rigor to ensure that the ownership declared in the IRPF is the one that effectively appears in the public records and deeds.