They are exempt from paying personal income tax if certain circumstances occur
Selling an apartment implies assuming some expenses and above all, we must be accountable to the Treasury! One of them is personal income tax, warns Helpmycash, which also explains in which cases you will be exempt from paying this tax to the Tax Agency.
Exemption for reinvestment in habitual residence
If you have sold your habitual residence and use the money to buy a new habitual residence, you can be free to pay personal income tax. To do this, you must meet a series of requirements:
The house you sell has to be the usual one. You must have resided there for at least three years continuously. If you do not meet this requirement, but the change of residence occurred for justified reasons, you can also take advantage of the tax benefit.
The new home must also be the habitual. To do this, you must inhabit it effectively within a period of twelve months from the purchase or completion of the works.
The term you have to make the reinvestment is two years. These can be both before and after the sale.
For the reinvestment to be complete, you must allocate all the money from the sale (taking into account the expenses) to the acquisition of the new house. If there is a surplus, you can take advantage of the exemption only partially.
Exemption for people over 65 years of age
Those over 65 do not have to pay personal income tax on the sale of their habitual residence, regardless of whether or not they reinvest their money in another residence. If the house they sell is a second residence, on the other hand, they will have to pay taxes on it, unless they use the money from the sale to constitute a life annuity under the following requirements:
Term. The contracting of the life annuity must be done within a period of six months from the date of sale.
Amount. The maximum amount whose reinvestment gives the right to enjoy the exemption is 240,000 euros.
Frequency. The rent must have a frequency of less than or equal to one year. In addition, this must begin to be received within a period of one year from its constitution.
Communication. You must notify the insurance company or the bank that the money is the product of the sale of a home and that you intend to benefit from the exemption.
Exemption for delivering the apartment in dation in payment
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If you had to hand over your home in a dation of payment because you have not been able to pay the mortgage, you can also enjoy the exemptionalthough it is necessary that you do not have any other property in property whose amount is sufficient to satisfy the entire debt.
In this case, to calculate whether you had a capital gain or loss, the difference between the acquisition value of the apartment that is transferred and its transfer value will be used. The latter is nothing more than the debt value that is extinguished with the dation.