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Practical manual for Income Tax 2019.

Introduction: capital returns

Regulations: Art. 21 Law PIT

The following are considered to be full capital returns: " all profits or compensation, whatever their name or nature, monetary or in kind, that come, directly or indirectly, from assets, goods or rights, the ownership of which corresponds to the taxpayer and are not related to economic activities carried out by the latter ".

Income derived from the transfer of ownership of assets, even when there is a reservation of ownership agreement, will be taxed as capital gains or losses, unless the Law itself PIT are classified as returns on capital.

Depending on the nature of the asset from which they come, the Law of PIT classifies capital returns into:

  1. Income from real estate capital , which includes income from real estate, both rural and urban, that is not related to economic activities carried out by the taxpayer.
  2. Income from movable capital , which includes income from other assets and rights owned by the taxpayer and which are not related to economic activities carried out by the taxpayer.

This chapter is devoted to the returns on real estate capital, while the following chapter discusses the returns on movable capital.