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V1069-21 ·23 April 2021 ·consulta-vinculante Medium impact
Tax

Donations subject to an obligation to repay a debt are taxed on their full amount for Inheritance and Gift Tax purposes

A query was raised regarding whether cash donations and the transfer of usufruct of shares, which require the donee to repay a debt to the company, constitute 'donaciones modales' (donations with a charge). The DGT ruled that these are onerous donations and are taxed on their full amount for Inheritance and Gift Tax purposes.

In 6 key points

How it affects those involved

This ruling clarifies that when a donation carries an obligation to settle a debt, the entire value of the gift is subject to tax, rather than just the net benefit received by the donee.

Lifecycle

2021-04-23PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

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This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
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