Capital gains from the transfer of certain properties

Regulations: Thirty-seventh Additional Provision of the Personal Income Tax Law

% of capital gains arising from the transfer of urban real estate acquired for consideration between May 12, 2012 and December 31, 2012.

The exemption applies to urban properties regardless of whether they are used in relation to economic activities.

This partial exemption is not applicable when the taxpayer has acquired or transferred the property to his spouse, to any person linked to him by kinship, in a direct or collateral line, by consanguinity or affinity, up to the second degree included, to an entity with respect to which occurs, with the taxpayer or with any of the aforementioned persons, any of the circumstances established in article 42 of the Commercial Code, regardless of residence and the obligation to prepare consolidated annual accounts.

In cases of reinvestment when the property transferred is the taxpayer's habitual residence and the amount reinvested is less than the total amount received in the transfer, the proportional part of the capital gain obtained will be excluded from taxation, once the exemption provided for in this Additional Provision, which corresponds to the amount reinvested in the terms and conditions provided for the exemption for reinvestment of habitual residence in article 38 of the Personal Income Tax Law . That is, the exemption of 50 percent of the gain obtained in the transmission will be applied first. The proportional part corresponding to the reinvested amount will be exempt from the other 50 percent of the profit.

The conditions and requirements for the application of this exemption are discussed in section Earnings excluded from taxation in reinvestment cases , of this same Chapter.