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V1818-18 21 June 2018 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · reducción en la base imponible

Eligibility for the 95% reduction in Inheritance and Gift Tax on the donation of shares

A taxpayer inquired whether they could apply the reduction for the donation of shares in a commercial entity while serving as sole administrator and commercial agent. The DGT ruled that the reduction is applicable provided the requirements for exemption from Wealth Tax are met.

The question raised

Admissibility of the reduction provided for in the Inheritance and Gift Tax Law.

The DGT's ruling

To apply the 95% reduction in the tax base for the donation of shares, it is a prerequisite that said shares benefit from the exemption in Wealth Tax. In this case, income from professional activity as a commercial agent is not taken into account to determine whether remuneration for management functions exceeds 50% of total income. Therefore, if the other legal requirements are met, the reduction is applicable.

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