Change to Donation Taxes Update
Over the past months, we have written many times about transferring property in Spain from parent’s names to that of your children as a donation, or early inheritance.
A number of people in the last year have donated their properties to their adult children, as the tax allowances in the Valencia region are currently very generous at 100,000€ tax free per adult child from each parent (as long as not step children and blood relatives) and good in the Murcia region too.
Donation Taxes Update
Brexit looked as if it would have an impact on the inheritance and donation taxes as once British people are no longer members of the European Union, it appeared that the concessions would no longer be applicable. We advised of this. Fortunately, in recent months the Spanish government appears to have accepted that it will not take away the right to regional favourable allowances to non-Europeans (something that previously looked very likely).
After that threat had passed, another one appeared in that the Valencian government had stated it’s intention to reduce or erase the favourable tax free allowances of 100,000€ per adult child for donations, and inheritances. They are still very likely to do this. However we have a bit more breathing space than we thought, as the Spanish government is in total disarray at the present time and unlikley to get round to changing this law in the Valencian region yet.
How To Inherit Paying Little Tax
We can quote the costs for a transfer of the property to your children with hopefully no donation tax currently, with just your deeds and a suma bill.
In summary, this remains a very good time to pass the property on to your children. If there is no donation tax in your circumstances, it is not going to get cheaper than this.
We keep saying this, but really, there will not be much longer that these savings remain. Please contact us to discuss donation or early inheritance to your children.