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V1104-16 21 March 2016 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · patrimonio especial protegido

Donation of primary residence does not qualify for the Disability Asset Protection Act

A query was raised regarding whether the donation of a primary residence to a child with a disability could fall under Law 41/2003. The Directorate General for Tax Affairs (DGT) ruled that such a donation does not meet the criteria of said law, nor does it grant direct tax benefits.

The question raised

Application of the Law for the Asset Protection of Persons with Disabilities.

The DGT's ruling

Law 41/2003 regulates a special protected estate linked to the vital needs of persons with disabilities, which is isolated from the rest of the personal estate. The donation of the primary residence does not fulfill the purposes of this law. Furthermore, there is no direct tax benefit for this scenario in either state Inheritance and Gift Tax regulations or regional regulations.

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