The generosity of donating a home in Spain can not only make a significant difference to the lives of those who receive it, but also brings a number of benefits to both the donor and society at large. In this article, we will explore the reasons to consider this noble deed, as well as the key steps to take if you wish to donate a property in Spain.
Donating a home is a tangible way to help individuals and families facing financial hardship or emergency situations. It can provide them with a safe haven and lay the foundation for a brighter future.
In Spain, donations of property are subject to certain tax benefits. Depending on the autonomous community, you can obtain reductions in gift tax, which can make the act of donating more financially attractive.
Donating a home is a lasting way to leave a positive legacy in society. You can take satisfaction in knowing that you are contributing to the well-being of others and making a significant difference in people's lives.
Before making a decision, carefully consider your reasons for donating the property and whether you are willing to give it up permanently. Make sure your donation is aligned with your personal values and goals.
It is important to talk to a lawyer or tax advisor who is familiar with the local laws and regulations in your autonomous community. They will help you understand the legal and tax aspects of the donation and guide you through the process.
You should obtain an updated appraisal of the property from a professional appraiser. This will determine the market value of the property and will be essential for the tax aspects of the gift.
You will need to draw up a gift contract, which should be drawn up by a notary. This document will set out the terms and conditions of the gift, including the identity of the recipient, the property in question and any special conditions you may wish to impose.
Make sure you fully understand the costs associated with the gift, including taxes and notary fees. Your advisor will help you calculate these costs and take the necessary steps.
Once all legal and fiscal requirements have been fulfilled, you can proceed with the handover of the property to the receiver. This involves the transfer of the property in the land registry and the handover of the keys.
Donar una vivienda en España es un acto de generosidad que puede cambiar vidas. Al seguir estos pasos y buscar la orientación adecuada, puedes asegurarte de que tu donación sea beneficiosa tanto para ti como para quienes la reciben. Es una forma de construir un futuro más brillante y de contribuir al bienestar de la sociedad en su conjunto.
Whether it is an inheritance ('mortis causa' transmission) or a gift ('inter vivos'), the taxable person, i.e. the person liable to pay the tax, is the person who acquires, inherits or receives by gift a property. The regulation of this tax is devolved to the autonomous communities and they have opted for very different taxation systems.
In the case of the Canary Islands, persons who receive a donation belonging to groups I (descendants and adopted children under 21 years of age) and II (descendants and adopted children over 21 years of age, spouses and parents) will benefit, provided that the donation is formalised in a public document, from a rebate of 99.9 percent of the tax liability, regardless of the tax liability, for group I exclusively. In the case of group II, this rebate will be 99.9 per cent up to 55,000 euros and, above that amount, the following scale will be applied:
- If the tax liability is greater than 55,000 euros and less than or equal to 65,000 euros: 90 percent.
- If the tax liability is greater than 65,000 euros and less than or equal to 95,000 euros: 80 percent.
- If the tax liability is greater than 95,000 euros and less than or equal to 125,000 euros: 70 percent.
- If the tax liability is greater than 125,000 euros and less than or equal to 155,000 euros: 60 percent.
- If the tax liability is greater than 155,000 euros and less than or equal to 185,000 euros: 50 percent.
- If the tax liability is greater than 185,000 euros and less than or equal to 215,000 euros: 40 percent.
- If the tax liability is greater than 215,000 euros and less than or equal to 245,000 euros: 30 percent.
- If the tax liability is greater than 245,000 euros and less than or equal to 275,000 euros: 20 percent.
- If the tax liability is greater than 275,000 euros and less than or equal to 305,000 euros: 10 percent.
Thus, from 2020, the tax exemption for each taxpayer for inheritances and donations received (99.9 percent) is limited to the first 300,000 euros.
Furthermore, it is important to know that, in the case of a donation of real estate, the tax will be paid in the autonomous community where the property is located (and therefore its regulations will apply). This is not the case in the case of inheritance: regardless of where the property is located, the regulations of the community where the deceased had his or her habitual residence will apply. This is essential when planning how to transfer real estate. In the case of money, the donation will be settled where the donee has his or her habitual residence.
As we conclude this article, we would like to remind all our readers that if you are ever considering buying a property in Tenerife, please do not hesitate to contact your trusted agent and a professional agency with the best reputation in the south of the island: DOM Tenerife Real Estate. We are happy to help you find the perfect property and provide expert advice on the exciting process of investing in this unique corner of the Canary Islands - your dream of owning a property in Tenerife is within reach! DOM Tenerife - buy safely!
#Inheritance and Gift Tax # Canary Islands # Taxable person # Tax rebate # Tax liability # Tax regulations # Donation groups # Tax exemption # Real estate donation # Autonomous communities # domtenerife