In a recent resolution of the Central Economic-Administrative Court (TEAC) of March 23, 2022, a case is resolved regarding unjustified capital gains due to the holding, declaration or acquisition of assets or rights for which the Form 720 had not been filed on time.
The TEAC accepts and applies the TJUE Resolution of 27 January 2022, Case Commission/Spain C-788/19 and, as opposed to the imprescriptibility and presumption of unjustified capital gains established in article 39.2 of the Personal Income Tax Law, the TEAC understands that there is no taxable income if it is proved by the taxpayer that the assets located abroad were financed with income declared or obtained in prescribed years.
The TEAC states that the TJEU Ruling obliges to reconsider the contested administrative settlement agreement, which it annuls, since the TJEU prevents the liquidation of unjustified capital gains without considering the statute of limitations as a limit. In short, since the Judgment, it is no longer possible to impute capital gains in accordance with art. 39.2 if it is justified that the assets abroad were acquired with income from prescribed tax years.
