What if you could unlock the value of your home—without leaving it?
For many people over 65, this is more than a hypothetical. It’s a very real challenge: they own their home outright, often mortgage-free, but their retirement income is limited. Rising living costs, health expenses, and the desire to enjoy this stage of life more comfortably are driving many older adults to explore ways to get liquidity from their home.
However, selling the property entirely—and having to move out—is often not an option they’re emotionally or practically willing to consider. The idea of leaving the family home, the neighborhood they know, and a space filled with memories can be overwhelming.
The good news is that there’s a legal and increasingly common alternative: selling the bare ownership of your home while retaining the lifetime usufruct—your right to live there until the end of your life. It’s a model that allows you to continue enjoying your home while receiving a lump sum or financial cushion to improve your quality of life.
But what happens with your taxes? How does this affect your IRPF (Spanish Personal Income Tax)? And can it really be done without unpleasant surprises from the tax office?
This article explores all the key points. For deeper detail, you can always refer to this complete guide on sale of a property retaining usufruct and transferring bare ownership under IRPF.
What does it mean to keep the usufruct?
When you sell the bare ownership of your property but retain the usufruct, you’re effectively separating the two components of full property ownership:
- The bare ownership, which is sold to a third party (the buyer).
- The usufruct, which is retained by you (the seller), giving you the legal right to live in or rent out the property for the rest of your life.
This means you are no longer the legal owner, but you maintain full rights of use. In many ways, it’s like “renting the property from yourself”—except there’s no monthly rent to pay, and the arrangement is protected by law and a public deed.
The best part? You don’t need to change your habits, leave your home, or alter your lifestyle.
This type of sale is recognized and regulated under Spanish civil law, and it has been growing in popularity because it aligns perfectly with the financial needs of many seniors.
How does this affect your income taxes?
Selling a home—even partially—has tax consequences, but in the case of this specific model, there are important exceptions and benefits, particularly for those over 65.
✅ If you are over 65 and the home is your primary residence:
You are completely exempt from paying tax (IRPF) on any capital gains you earn from selling the bare ownership. This is a major advantage and one of the main reasons why this type of operation is attractive to older homeowners.
⚠️ If you are under 65 or the home is not your main residence:
You will need to declare the capital gain you’ve made from selling the bare ownership in your tax return. However, the gain is only calculated on the portion sold, not on the entire property.
💡 How is the gain calculated?
It’s based on:
Sale price of the bare ownership – Acquisition cost of that portion
This means that if you originally bought the property for €100,000 and you sell the bare ownership for €60,000, the capital gain is the difference between that €60,000 and the corresponding acquisition value of that portion.
This amount is included in the “savings income” bracket and taxed accordingly, unless an exemption applies.
In any case, it’s essential to have an expert tax advisor assess your situation to avoid surprises and ensure that you’re making the most of all available deductions or exemptions.
Main benefits of this strategy
Selling your home while keeping the usufruct can provide real-life benefits far beyond the financial side:
- ✅ You don’t need to move: You stay in your home as long as you wish, with full legal backing.
- ✅ You receive immediate liquidity: This can help pay for private healthcare, home assistance, renovations, travel, or even support to your children or grandchildren.
- ✅ You gain peace of mind: You eliminate the worry of not having enough income in retirement.
- ✅ You may avoid paying taxes: Especially if you meet the 65+ and primary residence requirements under Spanish law.
This setup also tends to be simpler and more transparent than other financial products like the reverse mortgage, which can involve interest, debt accumulation, and greater financial risk.
Are there downsides?
As with any important financial decision, it’s important to be informed and cautious:
- 🔸 You give up full ownership: The property will no longer be yours to sell or inherit.
- 🔸 Your heirs may not inherit the property: The buyer becomes full owner upon your passing.
- 🔸 You must ensure a fair valuation: The amount you receive should be appropriate for the portion sold.
To avoid complications, always work with a trusted professional. At Kalma, they specialize in this type of operation and offer personalized, transparent support to ensure your interests are protected at every step.
Conclusion: A smart way to age on your terms
Selling the bare ownership of your home while keeping the usufruct is a practical, dignified, and increasingly common option for seniors who want to enjoy a more comfortable retirement—without leaving the place they love.
With the right legal and tax guidance, this model can offer financial freedom, legal certainty, and even zero tax cost under the IRPF.
If you’re considering this path, take time to learn, evaluate your options, and consult with professionals. With proper planning, this can be one of the best financial decisions of your life.
👉 Learn more in this guide on sale of property with usufruct and bare ownership IRPF.
Media Info
Name: Michael
Organization:Somoskalma
Email: info@somoskalma.com
Address: la Castellana 141, Planta 5, 28046 Madrid
Website:https://www.somoskalma.com/
