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V1917-22 8 September 2022 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · reducción en la base imponible

Reduction for donation of shares maintained if value and Wealth Tax exemption rights are preserved

The taxpayer asks whether selling part of donated shares to reinvest in another entity, or contributing the remainder to said entity, voids the reduction in Inheritance and Gift Tax. The DGT rules that the benefit is not lost provided the initial value and the right to Wealth Tax exemption are maintained.

The question raised

Whether the proposed operations constitute a breach of the tax benefit applied to the donation.

The DGT's ruling

To maintain the reduction under Article 20.6 of the LISD, the donee must preserve the acquisition value and be entitled to the exemption in Wealth Tax for ten years. The sale of shares to reinvest the amount in another entity does not breach the requirement if the initial value is maintained and the new shares allow for the Wealth Tax exemption. Likewise, the contribution of the donated shares to another commercial entity does not affect the maintenance of the reduction if the value and the right to the exemption regarding the substitute shares are preserved.

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