Proposal to cut and standardize Spain's inheritance and gift tax

Automatic summary, not yet reviewed

1. The bill would reorganize kinship groups: spouses, registered partners, ascendants and descendants would all fall into Group I, regardless of age, ending the disadvantage faced by children over 21 and unmarried couples.
2. It would set minimum state reductions by kinship (€1,000,000 for Group I, €350,000 for Group II and €125,000 for Group III) plus a 100% credit on the tax bill for Group I, so inheritances and gifts within the close family would not be taxed. Regional governments could not set lower amounts.
3. It would expand other state reductions: €180,000 or €360,000 for disability or dependency, 100% of the value of the deceased's main home, of family businesses and professional practices, of farms and forests, plus a new reduction for cash gifts used to start or expand a business.
4. The deadline to file and pay would go from six months to one year when at least 75% of the estate is illiquid assets, such as real estate, and payment in kind with homes or rural land would be allowed if the regional government provides for it.
5. The tax cut would have to be factored into the future reform of regional funding, and the state would push for tax obligations in the Basque Country and Navarre to be similar to those in the rest of Spain.
6. The new rules would also apply to people still within the filing deadline when the law takes effect, and it would enter into force on January 1 of the year after its publication in the official state gazette.

Who it affects

• People inheriting or receiving gifts from parents, children, spouses or partners: They would pay no tax, regardless of the region where they live.
• Siblings and more distant relatives: They would get fixed reductions of €350,000 or €125,000 and access to other reductions.
• People with a disability or in a situation of dependency: They could apply extra reductions of €180,000 or €360,000.
• People inheriting the deceased's main home, a business, or a farm or forest: They could reduce 100% of its value if they meet the holding requirements.
• Taxpayers with estates made up of illiquid assets: They would have one year, instead of six months, to file and pay.

Words worth knowing

Base liquidable

The amount on which the tax is calculated, after applying reductions to what is inherited or gifted.

Bonificación

A credit applied to the tax bill, that is, to the final amount to pay.

Adquisiciones mortis causa e inter vivos

What is received by inheritance (after a death) and what is received by gift (during the giver's lifetime).

Causahabiente

The person who inherits or receives assets from someone who has died.

Activos ilíquidos

Assets that are not cash and are harder to turn into cash, such as apartments or land.

It summarizes the text as it was introduced. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries