Exemption

Regulations: Articles 38.1 Law IRPF , 41 Regulation IRPF

Capital gains obtained from 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 under the conditions indicated below:

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

For these purposes the rehabilitation of the home is considered to be the same as its acquisition, and works on it that meet any of the following requirements are considered as such:

1. That these are subsidized actions in the area of housing rehabilitation under the terms provided for in Royal Decree 233/2013, of April 5, which regulates the State Plan for the promotion of housing rental, building rehabilitation, and urban regeneration and renewal, 2013-2016.

2. Those whose main objective is the reconstruction of the dwelling by consolidating and treating the structures, facades or roofs and other similar works, provided that the overall cost of the rehabilitation operations exceeds 25% of the purchase price if this had been carried out during the two years immediately prior to the start of the rehabilitation works or, otherwise, the market value of the dwelling at the time of said start. For these purposes, the proportional part corresponding to the land will be deducted from the purchase price or market value of the home.

Likewise, the taxpayer can also obtain the tax benefit of the reinvestment exemption if he allocates the amounts obtained from the sale of the habitual residence to pay the price of a new habitual residence under construction, including the possibility of self-promotion.

In accordance with the doctrine established by the Supreme Court Ruling No. 1098/2020, of July 23, 2020, filed in the administrative appeal no. 4417/2017 ( ROJ : STS 2698/2020) in the case of reinvestment in future construction, two requirements must be met for the reinvestment exemption to apply:

 1) That the entire amount received be applied to the construction of the new home, within the two-year reinvestment period.

 2) That the requirements of article 55 of the IRPF Regulation are met in the version in force on December 31, 2012, in accordance with the eighteenth transitional provision of the IRPF Law and the twelfth transitional provision of the IRPF Regulation . For this purpose, proof must be provided that the works have been completed within a period of four years, unless otherwise provided for in sections 3 and 4 of article 55 of the IRPF Regulations.