Now is an excellent time in the Valencia and Murcia region for donations
It is important to realise that early inheritance and donations of assets in Spain may attract taxes. You need to be aware of the rules. The taxes on Spain for a donation or inheritance in lifetime may vary from region to region. This is as different areas of Spain are autonomous. They can dictate their own taxes for many concepts. Contact us for an explanation of costs and taxes.
We are based in the Valencia region. We also do many early inheritances and donations in the Murcia region. However for donations of property and assets we are usually able to advise the current situation for wherever the assets are located in Spain and to help with a change of ownership.
In each region of Spain the recipient of early inheritances and donations may have a tax–free allowance. This depends on the relationship of the donor to the donee. Thus any gifts should be referred to a law firm, who can advise what taxes (if any) need to be paid.
It is also important to realise that when there is a change of ownership of property in Spain (in whatever manner) there will be costs incurred. This is for Notary, Land Registry, Solicitor fees, and plusvalía (a town hall tax), and sometimes donation tax.
Allowances are very favourable at the moment in the Valencian and Murcian regions for donations to property to children. Therefore many people are choosing to pass on their property as an early inheritance, but costs vary depending on the value of the asset/s and where they are located. We know that very soon the window of opportunity to pass assets in the Valencia Community to children by donation or gifting will close. Taxes are likely to be a great deal higher, so we advise arranging a donation now.
Please be aware that in many regions husbands and wives cannot transfer property or a share of property to each other without giving rise to a tax liability. Thus if one of you is ill, please speak to a solicitor before considering any precipitous action.
Property should not be transferred to a child who is a minor if there is a mortgage on the property. If there is no mortgage both parents need to sign.
For a detailed breakdown of costs of early inheritance and donations of a property and to discuss this issue further, please contact us.