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V0402-22 2 March 2022 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · hecho imponible

Mortgage debt may be deductible for Inheritance Tax if its existence is proven

A taxpayer inquired whether documentation for an inherited mortgage is sufficient to deduct the debt from Inheritance and Gift Tax. The Directorate General for Taxes (DGT) stated that the debt is deductible if proven via a public deed, a private document meeting legal requirements, or other means; however, the sufficiency of such documentation must be assessed by the Tax Administration.

The question raised

Whether the documentation to be submitted to the relevant tax authority is sufficient to consider said loan as a deductible debt for Inheritance and Gift Tax purposes.

The DGT's ruling

Debts incurred by the deceased are deductible provided that their existence is proven by a public document, a private document that meets the requirements of Article 1.227 of the Civil Code, or is otherwise justified. However, the sufficiency of the documentation provided is a factual matter to be assessed by the tax administration according to the circumstances of the case.

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