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A taxpayer asks which legislation applies to the inheritance tax following the death of their father, who resided in Madrid after living in the Basque Country. The DGT confirms that Madrid's regulations apply, as Madrid is the deceased's habitual residence.
Question raised - Applicable regulations regarding Inheritance and Gift Tax.
The collection of the tax corresponds to the Provincial Council only if the deceased has their habitual residence in the Basque Country on the date of accrual. Since the deceased has resided in Madrid since December 2020, the applicable regulations are those of the Community of Madrid. Furthermore, the reduction for family business is not applicable if the inheritance consists of paintings from a work and not the professional business itself.
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