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Practical Income Manual 2022.


Regulations: Articles 38.1 Law Personal Income Tax , 41 Regulation Personal Income Tax

The capital gains obtained in the transfer of the taxpayer's habitual residence may be exempt, when the total amount obtained from the transfer is reinvested in the acquisition of another habitual residence or in the rehabilitation of the one that will have such character .

Without prejudice to the above, take into account the exemption of capital gains derived from the transfer of the habitual residence for people over 65 years of age or for people in a situation of severe or great dependency, as discussed in the section " Gains exempt assets ", of this same Chapter.

Special case: transfer of habitual residence with amounts pending amortization

When the taxpayer has used external financing to acquire the transferred home, the total amount obtained in the transfer will be considered, exclusively for these purposes, the transfer value in the terms provided in the Personal Income Tax Law less the principal of the loan pending amortization. In these cases, therefore, it is not considered that there is partial reinvestment, although part of the amount obtained in the transfer of the home has been allocated to the repayment of the outstanding loan.