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Practical manual for Income Tax 2024. Volume 1

General calculation rules

Regulations: Articles 34 to 36 Law IRPF and 40 Regulation IRPF

Note: Please note the summary tables of the general rules at the end of this section.

The determination of the amount of capital gains or losses arising from the transfer, whether onerous or lucrative, of non-affected assets is determined by the difference between the transfer and acquisition values of the assets.

Precision: To determine the amount of the capital gain or loss arising from the see the section on specific valuation rules in this Chapter.

A. Acquisition value

The acquisition value will be formed by the sum of:

  1. In the case of transfers for valuable consideration: for the actual amount for which said acquisition would have been made.

    In the case of transfers for valuable consideration, the acquisition value must be determined based on the actual amount for which the acquisition was made. Likewise, to determine the transfer value, the real amount for which the sale was made is taken as the amount actually paid, provided that it is not less than the normal market value, in which case the latter will prevail. Therefore, this will be the way of determining the acquisition and transfer values of the property transferred for the purposes of calculating the capital gain or loss in the IRPF , regardless of the establishment of a reference value of the properties for determining the tax base in the ITPAJD

    However, in those cases where there is no reference value or it cannot be certified by the General Directorate of Cadastre, establishing the market value as the taxable base in the ITPAJD after a prior administrative check, said market value will be taken as the acquisition value of the properties in the IRPF , as it is higher than the agreed price or consideration. Only in such cases is the Supreme Court's ruling of December 21, 2015, issued in appeal for the unification of doctrine no. applicable. 2068/2014 ( ROJ : STS 5470/2015) in relation to the principle of uniqueness of values as opposed to the principle of watertightness. 

  2. In the case of transfers for profit or free of charge (inheritance, legacy or donation): for the declared or the administratively verified for the purposes of the Inheritance and Gift Tax, without this being able to exceed the market value. For these purposes, the following should be taken into account:

    • For acquisitions or transfers by inheritance, for profit, made before January 1, 2022, article 36 of the Personal Income Tax Law establishes that the real amount of the respective acquisition and transfer values will be taken as those resulting from the application of the rules of ISD , without being able to exceed the market value.

      In accordance with the aforementioned regulations, the real value of the assets and rights will be taken, less any deductible charges and debts.

      In this regard, the Supreme Court, in its reiterated jurisprudence, equates real value with normal market value (see in this regard Supreme Court ruling No. 202/1991, of May 7, 1991 (ROJ: STS 17245/1991)), and for its definition it refers to the Order of 30 November 1994 on rules for the valuation of real estate for certain financial entities (BOE of 13 December), repealed by Order ECO/805/2003, of 27 March, on rules for the valuation of real estate and certain rights for certain financial purposes (BOE of 9 April), which defines market value as: “the price at which the property could be sold, by private contract between a willing seller and an independent buyer, on the date of the appraisal, assuming that the property had been publicly offered on the market, that market conditions allowed for its orderly disposal, and that there was a normal period, taking into account the nature of the property, to negotiate the sale.” See in this regard, among others, Supreme Court judgments Nos. 3379/1991, of October 5 (ROJ: STS 4887/1995), or 163/2019, of March 26 (ROJ: STS 881/2019).

    • For acquisitions or transfers by inheritance, for profit, made from January 1, 2022, to the extent that the rules of the ISD establish the reference value of the properties as the taxable base (unless the declared value is higher, in which case this will be taken), this reference value will be the one that must be taken into account as the real amount for which the acquisition or transfer has been made when calculating the capital gain or loss in the Personal Income Tax, without being able to exceed the market value. The Tax Agency may therefore regularise the capital gain declared in the IRPF taking into account the reference value of the property, if the taxpayer declared lower values.

    However, as of July 11, 2021, in the case of lucrative acquisitions due to death, derived from contracts or succession agreements with effect from the present , the beneficiary thereof who transfers the acquired assets before the expiration of five years from the conclusion of the succession agreement or the death of the deceased, if earlier, will be subrogated in the position of the latter, with respect to the value and date of acquisition of those, when this value is lower than that provided for in the previous paragraph.

    Law 11/2021, of July 9, on measures to prevent and combat tax fraud, transposing Council Directive ( EU ) 2016/1164, of 12 July 2016, which establishes rules against tax avoidance practices that directly affect the functioning of the internal market, modifying various tax rules and the regulation of gambling, has added a new paragraph to article 36 of the Personal Income Tax Law to subject to taxation those cases in which, in the five years following the conclusion of the succession agreement or the death of the deceased (if earlier), the assets are transferred by the beneficiary of the succession agreement. In this case, the successor loses the value update carried out through the ISD and is subrogated on the date and value of acquisition of the original owner. The Constitutional Court has confirmed the constitutionality of this temporary condition provided for in the new paragraph of article 36 of the Personal Income Tax Law ( STC 62/2023, of May 24). 

    It should be noted that the institution of "succession agreements" (contractual succession) is prohibited under common law (articles 1,271, 658 and 816 of the State Civil Code), but is maintained in the civil, regional or special laws of certain Autonomous Communities where the Civil Code is not fully in force (Aragon, the Balearic Islands, Catalonia, Galicia, Navarre and the Basque Country).

    Important: The provisions for succession agreements will only apply to transfers of assets made after July 11, 2021, which were acquired for profit due to death by virtue of contracts or succession agreements with present effects.

    See in this regard the first transitional provision.4 of Law 11/2021, of July 9, on measures to prevent and combat tax fraud, transposition of Council Directive ( EU ) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market , modifying various tax and gambling regulations regulations ( BOE of July 10)

    In the lucrative transfers of companies or shares referred to in article 20.6 of Law 29/1987, of December 18, on the Tax on Inheritances and Donations ( BOE of December 19), the acquisition value will coincide with the original value of the donor since the donee is subrogated in the position of the former with respect to the values and dates of acquisition of said assets.

  3. The cost of investments and improvements made to the acquired assets, without taking into account, for these purposes, the costs of maintenance and repair.

    For these purposes, an improvement is considered to be the compensation paid by the owner to his tenant so that the latter vacates the property.

    The Resolution of March 1, 2013, of the Institute of Accounting and Auditing of Accounts, which dictates rules for the registration and valuation of tangible fixed assets and real estate investments ( BOE of March 8), in section 3 of its second rule understands "improvement" as the set of activities through which an alteration occurs in an element of fixed assets, increasing its previous productive efficiency.

  4. The expenses (commissions, Notary Public, Registry, etc. .) and taxes inherent to the acquisition ( Patrimonial Transfers and Documented Legal Acts, VAT or Inheritance or Donation Tax if the acquisition was made free of charge), excluding the interests that had been paid by the acquirer.

    Please note that if a property has been inherited, the Urban Land Value Increase Tax has been paid, and the property has subsequently been transferred, the heir will have included it as a higher acquisition value. Therefore, if a tax refund has been received, it must be removed from the purchase price by submitting a supplementary self-assessment.

  5. From the sum corresponding to the previous amounts , the amount of the tax-deductible amortizations will be subtracted, computing in all cases the minimum amortization , regardless of its effective consideration as an expense.

    The minimum amortization is the result of the maximum amortization period or the corresponding fixed percentage, depending on each case.

    For leased properties, the minimum depreciation amount is determined by applying 1.5 percent until December 31, 1998; 2% until December 31, 2002, and 3% from January 1, 2003.

    In relation to the calculation of depreciation, it should be noted that:

    • Amortization not applicable for assets are not susceptible to depreciation, such as land, securities, etc.

    • "Tax-deductible" depreciation corresponds to real estate or personal property used for economic activities, to real estate or personal property leased or subleased, to real rights of use and enjoyment of real estate, to cases of provision of technical assistance that does not constitute an economic activity and to the leasing of businesses or mines or subleases. In these cases, the minimum amortization will be computed, regardless of its actual consideration as an expense.

    • In the case of the transfer of assets related to economic activities, the book value is considered as the acquisition value, taking into account any depreciation that would have been tax deductible, without prejudice to the minimum depreciation referred to above.

    • In the case of real estate that has been leased, depreciation will be considered to meet the effectiveness requirement when, in each year, it does not exceed the result of applying the percentage of 3% to the highest of the following values: acquisition cost paid or the cadastral value, excluding the value of the land. When the value of the land is not known, it will be calculated by prorating the acquisition cost paid between the cadastral values of the land and the construction for each year.

      In the case of real estate acquired for profit, it must be taken into account that the acquisition cost paid includes the value of the property acquired in application of the rules on Inheritance or Gift Tax or its value verified in these taxes (not including the value of the land). Interpretive criteria established by the Supreme Court (Administrative Litigation Chamber) in its Judgment No. 1130/2021, of September 15, in the appeal for cassation number 5664/2019 ( ROJ : STS 3483/2021).

      The acquisition cost also includes the amount of taxes and expenses inherent to the acquisition and, where applicable, all investments and improvements made.

B. Transmission value

The transmission value will consist of:

  1. The actual amount for which the transfer was made or the declared value or, where applicable, the value administratively verified for the purposes of the Inheritance and Gift Tax when the transfer was made for profit or free of charge, without this being able to exceed the market value.

    The actual amount of the sale value will be taken as the amount actually paid, provided that it is not less than the normal market value, in which case the latter will prevail.

  2. From the above amount, expenses and taxes inherent to the transfer, excluding interest, may be deducted to the extent that they have been paid by the transferor.

Precision: treatment of amounts delivered as a deposit in the event of the transfer of a property.

The deposit contract is a private document by which the buyer and seller agree to reserve the right to purchase the property, with the buyer paying an advance payment (deposit) equivalent to a percentage of the property's price. Its amount is therefore part of the purchase price of the property, which will be deducted from it.

For the buyer:

  • In the event of a sale, the payment of a deposit will not have any impact on personal income tax.

  • In the event of withdrawal, a capital loss will be incurred and will be included in the general taxable base.

  • In the event of non-compliance by the seller, the buyer may consider that a capital loss has occurred (with respect to the amount delivered and not recovered) when, once the right to credit has been recognized with respect to the amount delivered, any of the circumstances established in letter k) of article 14.2. occur, for which it is necessary that it be a judicial procedure aimed at the enforcement of the credit.

For the seller:

  • If the sale is made, the amount received as a deposit will be affected by your personal income tax return for the tax period in which the asset is sold, at which time it will be deducted from the sale price.
  • If the transfer is not made due to a cause attributable to the buyer, the amounts received by the seller as a deposit will be classified as capital gains and will be allocated to the tax period in which the seller can proceed with its execution, in accordance with the terms of the contract.

    This capital gain, as it does not derive from a transfer, will form part of the general income, in accordance with the provisions of article 45 of the Income Law, and its integration will be carried out in the general tax base, in the manner provided for in article 48 of the same Law.

    Therefore, the signing of the deposit contract does not give rise to a variation in the value of the assets, as a result of a change in their composition for the purposes of their classification as capital gain or loss, but rather said capital gain or loss will occur when the transfer is made, if applicable.

C. Special assumption: Transfer of assets to which improvements have been made in a year other than that of acquisition

In the case of assets on which improvements have been made in a year other than that of acquisition, it will be necessary to distinguish the part of the transfer value that corresponds to the asset and to the improvement or improvements made, in order to determine, separately and independently, both the capital gains or losses derived from each, as well as the reduction that, where applicable, is applicable. For these purposes, the values and dates of acquisition will be taken as those that correspond, respectively, to the asset and to each of the improvements made.

Consequently, the capital gains or losses thus determined may have different periods of generation, and the reduction percentages that may be applied to the capital gains will also be different depending on the seniority of the assets themselves and each of the improvements made as of December 31, 1996, taking into account that if improvements have been made to the transferred assets, the period of time that these improvements remain in the taxpayer's assets will be taken as the number of years between the date on which they were made and December 31, 1996, rounded up.

Summary diagrams

The components of the respective acquisition and transfer values, depending on whether the transfer is onerous or lucrative, are those indicated in the following tables:

a) Outline - summary: onerous transmission

Regulations: Art. 35 Law Income Tax

(+) Actual amount of the acquisition.

(+) Investments and improvements made to acquired assets.

(+) Expenses and taxes inherent to the acquisition (except interest), paid by the purchaser.

(-) Depreciation (leased property or furniture and rights thereon, as well as in the cases of provision of technical assistance that does not constitute economic activity).

= Acquisition value



(+) Actual amount of the transfer provided that it is not less than the market value, in which case, the latter prevails.

(-) Expenses and taxes inherent to the transfer paid by the transferor.

= Transmission value

b) Outline - summary: lucrative streaming

Regulations: Art. 36 Law Income Tax

(+) Purchase value for the purposes of Inheritance and Gift Tax with the limit of the market value.

(+) Investments and improvements made to acquired assets.

(+) Expenses and taxes inherent to the acquisition (except interest), paid by the purchaser.

(-) Depreciation (leased property or furniture and rights thereon, as well as in the cases of provision of technical assistance that does not constitute economic activity).

= Acquisition value



(+) Actual amount of the transfer (or Transfer value for the purposes of Inheritance and Gift Tax with the limit of the market value.

(-) Expenses and taxes inherent to the transfer paid by the transferor.

= Transmission value