Spanish Tax Administration Order HAP/2474/2015 of 19 November approved the form for requesting a return based on the habitual residence reinvestment exemption.

The exemption for reinvestment in a habitual residence is effective as of 1 January 2015, allowing non-residents to be exempt from paying taxes on capital gains obtained from the sale of their habitual residence in Spain when said earnings are used to purchase a new habitual residence in the country where they are currently residents for tax purposes.

It is worth highlighting that the exemption will only be applicable when Non-Resident Income Tax taxpayers are residents of a European Union Member State or a member state of the European Economic Area with which there is an effective means of taxation information exchange.
To this end, only the proportional part of the capital gains obtained corresponding to the re-invested amount is exempt when the amount re-invested in the new habitual residence is lower than the total value of the disposal of the habitual residence in Spain.

In order to request the return, non-resident taxpayers must submit the form to the Spanish Tax Agency Administration corresponding to the location of the property disposed in Spain, attaching proof of the transfer of the habitual residence and the purchase of the new residence in the other State.

The deadline for submitting the request form along with the documents proving the transaction is three months from the date of purchase of the habitual residence outside Spain.


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