When and why did the DFL2 arise?
Decree with Force of Law Number 2 was created in 1959. It was issued with the purpose to solve the housing deficit that affected the middle sectors of the population.
This would allow people to acquire the homes in order to obtain income, but only up to 140 square meters. There is the payment of 50 percent of the territorial tax, with a range of between 10 to 20 years; it depends on the surface of the house.
Decree with Force of Law was modified in 2010 and set the maximum number of homes to two per person. In other words, if you own three or more homes acquired as of that date, you only have the right to take advantage of the DFL 2 franchises for the first two. This is as long as you have not acquired homes before the indicated date.
What does it mean for a home to be subjected to DFL2?
Decree with Force of Law Number 2 or DFL2 is a benefit for homes called “economicas”. These are defined with a built area that do not exceed 140 square meters; it should be noted that parking, gardens or pools are not considered in the footage.
New DFL2 homes
- You can reduce 50% of the tariff in the Conservator of Real Estate. When buying a house you must register as DFL 2 and thus only pay half of the tariffs.
- Reduction of 50% of the stamp and stamp rate.
- Exemption from inheritance tax and donations, this property can be left as inheritance after a death or in life and will not pay taxes.
New and Used DFL2 homes
- Income from tax-free lease.
- Reduction of 50% of contributions: up to 70 m² will have the benefit for 20 years, between 71 m² and 100 m² will have the franchise for 15 years, from 100 m² to 140 m² the exemption of payment of contributions will be for 10 years.
Sale of the property
The gain will be tax free, as long as more than one year has elapsed between the date of purchase and sale. Otherwise, the REIC (‘SII’ in Spanish) can presume habitability and demand the payment of the respective tax. You can also be subject to income taxes if the seller is engaged in the usual marketing of homes.
When are the lost benefits?
The condition of DFL2 is lost if the property changes its residential destination or if it exceeds the maximum building area of 140 square meters. Extensions are allowed, as long as the permitted footage is not exceeded and the respective municipal reception is available.
Translated from ‘Conoce qué es una vivienda acogida al DFL2‘