Tax treatment of income from leasing rooftops in homeowners' associations

The Dirección General de Tributos (DGT) has issued a relevant ruling regarding the attribution of income generated by common elements of a homeowners' association, specifically concerning the leasing of rooftops and how these amounts must be taxed in the IRPF.

What the DGT has ruled

The inquiry addresses the tax treatment of income obtained from the lease of a rooftop owned by a homeowners' association. The ruling establishes that income from homeowners' associations is attributed to the co-owners as real estate capital income, following their share of participation or the provisions set out in the bylaws.

In the specific case where a usufruct exists, the DGT points out that the usufructuary has the legal right to receive the civil fruits of the assets. Therefore, the income derived from the lease of the rooftop must be attributed to the usufructuary, who is obligated to declare said income in their IRPF tax return based on their degree of participation.

What it means for you

This ruling has a direct impact on individuals who hold the status of usufructuaries or co-owners in a homeowners' association. If the community of neighbors receives income from the use of common areas, such as rooftops or telecommunications installations, the ownership of that income does not belong to the community as an entity, but is instead distributed among its members.

If you are a usufructuary, you must keep in mind that income from leasing common elements is considered real estate capital income. This implies that the tax burden falls on you and not on the bare owners, in accordance with the regulations of the Personal Income Tax (IRPF) and the Civil Code.

What you should do

It is necessary to verify the nature of the ownership of the assets and the existence of usufruct rights in your community. Upon receiving income from common elements, you must ensure that the attribution of the income is carried out correctly according to your participation to avoid discrepancies with the Tax Administration. It is recommended to assess each particular situation to determine the exact treatment of this income in your annual tax return.