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V0114-16 15 January 2016 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · reducción por sucesiones

Succession tax reduction is not lost if a co-heir sells their undivided share to the other heirs

An heir inquired whether selling their share of an inherited property to their siblings at a value lower than the acquisition cost would result in the loss of the succession tax reduction. The DGT ruled that the maintenance requirement applies to the group of heirs as a whole.

The question raised

Whether a reduction in the transfer value of approximately 5% compared to the acquisition value would constitute a "substantial reduction" for the purposes of maintaining the applied reduction. Whether the transfer would entail the loss of the right to the reduction. Whether the transferor should reinvest the amount received in real estate or investment funds until the expiry of the legal maintenance period.

The DGT's ruling

The requirement to maintain the acquisition under Article 20.2.c) of Law 29/1987 refers to the group of heirs as a whole. The transfer of an undivided share to the other co-heirs does not entail the loss of the reduction, even if the transfer value is lower than the acquisition value. It is not necessary to reinvest the amount obtained to maintain the right to the reduction.

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