Castilla La Mancha

Gift tax Castilla La Mancha

“Comunidades Autónomas” have their own inheritance and gift tax regulations as a result of the Spanish State ceding the tax revenue of inheritance and gift tax to the “Comunidades Autónomas”, along with some regulatory autonomy to adapt tax to the particular circumstances of each.

This means that most of them have ruled new (and huge) benefits compared to those established by the Spanish State.

While the tax scheme and regime is the same in all parts of Spain, the “Comunidades Autónomas” took advantage of their new powers to fix higher thresholds, or different rates or direct reductions on the amount to be paid (and sometimes all of these) to benefit close relatives of the deceased or disabled people. There are also benefits that help promote local business, farming, etc. as well as in the acquisition of cultural assets of each Comunidad Autónoma.

However, the regulations change quite frequently so it is necessary to check the regulation in force at the time the tax is due.

Castilla La Mancha has ruled the following benefits:

Reductions for the gift of an individual enterprise or a professional business or a share in a company

There is an improvement of 4% from the State law reduction of 95%, to a reduction of 99% for gifts of the above. The entity must be base physically and for tax purposes in Castilla-La Mancha and be retained for 5 years from the date of donation. Property companies are not allowed.

Reductions for gifts of assets of cultural heritage

There is a reduction for gifts included in the Castilla-La Mancha catalogue of cultural heritage which are made to public institutions – universities, centres of investigation, arts education centres and non-profit cultural organisations.

Deductions for gifts

For ascendants and descendants, both natural and adopted, spouses and unmarried partners who have been registered in the register of unmarried partners of Castilla-La Mancha for 2 years, the following deductions apply for gifts, including recipients of life insurance policies:

a) A deduction of 95% for gifts below 120,000€
b) A deduction of 90% for gifts from 120,000€ to below 240,000€
c) A deduction of 85% for gifts of 240,000€ or more

Tax payers with a disability of 65% or more can apply a deduction of 95%, as can those for contributions to “Patrimonios Protegidos” for disabled people. These deductions are compatible with the previous ones and will be applied afterwards.

Conditions for deductions

a) The gift must be formalized in a public deed stating the origin and location of the assets with the correct tax information and identification.
b) Any non-cash gifts must be retained by the recipient for a minimum of 5 years from the date of the public deed. If the gift is of individual enterprise or a professional business or a share in a company the corresponding conditions must also be adhered to for a minimum of 5 years.
c) If the gift or conditions are not maintained the recipient must present a tax declaration within 30 working days and pay the tax now owed plus interest.

  • The question now is when can these benefits be taken advantage of?

    When the gift is of immovable assets located in Castilla La Mancha or the gift is of other kinds of assets when the beneficiary is a resident in Castilla La Mancha.

  • Any Questions?

    Contact us for specific personal advice for your individual case