Personal Income Tax exemption on home sales: the case of garage spaces

The transfer of a primary residence by persons over 65 years of age enjoys favorable tax treatment under Personal Income Tax (IRPF). However, doubts arise as to whether ancillary elements, such as garage spaces, can benefit from this exemption if they were not acquired jointly with the main property.

What the DGT has ruled

The Dirección General de Tributos (DGT) has analyzed whether a garage space can be considered a primary residence for the purposes of the exemption provided in article 33.4 b) of the LIRPF (Law 35/2006). The criteria establish that, for an element such as a garage to be assimilated with the primary residence and access the tax benefit, it must meet two fundamental requirements:

• Be located in the same building or real estate complex as the home.
• Have been acquired in the same transaction as the primary residence.

The resolution clarifies that elements acquired independently or subsequent to the main building are not considered part of the primary residence. Therefore, if the garage space was purchased at a different time than the home, the exemption cannot be applied.

What this means for you

If you are over 65 and are going to sell your residence, it is essential to distinguish the nature of the assets that make up your estate. If, in the sale operation, you include a garage space that was not acquired simultaneously with the home, the Tax Administration will consider that said space does not form part of the primary residence. This implies that the capital gain derived from the sale of the garage will be taxed under IRPF, unlike the gain generated by the home, which would be exempt.

What you should do

It is necessary to verify the acquisition documentation for all elements that compose your real estate assets. Checking whether garage spaces, storage rooms, or outbuildings were acquired in the same transaction as the home is a necessary preliminary step to determine the tax impact of a future sale. Each estate situation is different, so it is recommended to assess the composition of the property before formalizing any transfer operation.