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V0542-18 26 February 2018 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · reducción por adquisición de empresa

Family business inheritance tax relief may be maintained without continuing the economic activity

A taxpayer inquired whether they are entitled to the business acquisition reduction after inheriting a pharmacy that must be sold due to a lack of professional qualifications. The Directorate General for Taxes (DGT) ruled that to retain the reduction, it is not necessary to continue the business activity, but rather to maintain the value of the acquired assets for ten years.

The question raised

Whether the consultant is entitled to the reduction for the acquisition of companies established in Article 20.2.C) of Law 29/1987.

The DGT's ruling

Regarding the reduction for the acquisition of a company in successions, it is not necessary for the acquirer to continue with the activity of the deceased. It is sufficient that the value of the acquisition is maintained during the ten years following the death. This allows both for reinvestment in another economic activity and for the placement of the amount in a financial institution, provided that the maintenance of the value can be proven.

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