When a person passes away and leaves assets to the inheritors, they are generally obligated to pay the “inheritance tax”. On the other hand, when we receive a donation or gift which surpasses a certain amount, we are also obligated to pay the State a part of this, through the so called “donation tax”.
In the practise, both taxes that, initially have a different nature, are paid through the same tax form, that of Inheritance and Donation. From the technical point of view, this is a direct, personal, subjective and progressive tax, which taxes the increase of assets due to the obtained profit. In either case, we recommend you consult with the solicitor to receive the specific tax assessment depending on the circumstance of each case.
The taxable cases of Inheritance and Donation taxes consist of:
- The acquisition of assets and rights by inheritance, legacy or any other succession deeds.
- The acquisition of assets and rights by donation or any other form of legal business free of charge (as to say, without anything in return) and “intervivos” (in life).
- Beneficiaries of life insurance policies receiving amounts, when the person that takes out the policy is a different person to the beneficiary.
The passive subjects of this tax are:
- The inheritors: In the case of “mortis cause” acquisitions, that is, due to the death of a person.
- The donee or beneficiary: In donations and other “inter vivos” (in life) profitable transmissions, or between people that have not passed away.
- The beneficiaries: In life insurance policies, all and when the beneficiary is a different person than who took out the insurance policy.
It is constituted of:
- In “mortis causa” (after death) transmissions: of the net value of the individual acquisition of each heir, that is, the real value of the assets and rights, minus the charges and deductible costs.
- In donations and other profitable “inter vivos” transmissions: of the net value of the acquired assets and rights, that is, the real value of the assets and rights, minus the charges and deductible costs.
- In life insurance policies: of the amounts received by the beneficiary. These amounts are settled adding the amount received for the policy to the rest of the assets and rights that constitute the inherited share of the beneficiary.