Skip to content
Back to index
V1259-20 5 May 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital mobiliario

Free establishment of usufruct over shares generates income from movable capital for Personal Income Tax purposes

A taxpayer has requested clarification regarding the tax treatment of the free establishment of usufruct over company shares in favour of their parents. The Directorate General for Taxes (DGT) indicates that, for Personal Income Tax (IRPF) purposes, this is classified as income from movable capital and, being a gratuitous act, it shall be presumed to be remunerated at market value. Regarding Inheritance and Gift Tax, general regulations and specific rules for the valuation of usufruct shall apply.

The question raised

Tax treatment of said transaction in Personal Income Tax and in Inheritance and Gift Tax.

The DGT's ruling

In Personal Income Tax, the creation of rights of use or enjoyment over shares is classified as income from movable capital. As it is a transaction for consideration, it is presumed to be remunerated and must be valued at fair market value. In Inheritance and Gift Tax, the special valuation rules for life usufruct apply, and the competence of the Autonomous Community will depend on the connecting factor established by law.

Book your free first meeting