Over-65s cannot claim exemption on capital gains tax if property is not their main home
The Ministry of Finance has clarified, in a new binding ruling, that taxpayers aged over 65 cannot claim the IRPF capital gains exemption when selling a property that does not legally qualify as their main residence, even if they are registered (empadronados) at that address.
The clarification appears in binding consultation V0241-25, dated 5 March 2025, which examined the case of a taxpayer seeking to apply the exemption without having lived in the property for the minimum required period.
What counts as a “main residence”
Article 33.4.b of Law 35/2006 on Personal Income Tax (IRPF) exempts capital gains from the sale of a main residence when the seller is over 65.
However, this benefit only applies if the property meets the legal definition of a main home.
According to Article 41 bis of the IRPF Regulations (Royal Decree 439/2007), a main residence is one in which the taxpayer has lived continuously for at least three years.
Registration alone is not enough
In the case reviewed, the taxpayer inherited half of a property in 2021 and purchased the remaining half in 2022. She registered herself at the address that same year after selling her previous main home.
But when planning to sell the property in 2024, she had not met the three-year minimum residence requirement, nor could she demonstrate any exceptional circumstances that might permit a shorter period of occupancy under the law.
The Ministry stressed that determining a main residence is a matter of factual proof, and while registration on the municipal census may support a claim, it is not conclusive evidence of actual, continuous residence.
Taxable gain if requirements are not met
As a result, the exemption for over-65s does not apply when a property does not legally qualify as a main residence. The capital gain from the sale must therefore be fully declared and taxed within the IRPF.
This clarification serves as a reminder to residents, including many foreign homeowners in the Canary Islands, to ensure they meet all legal criteria before relying on tax exemptions linked to property sales.
Share:
