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V2319-19 9 September 2019 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
OTRO · donación

Transfer of funds from parents to children: ISD if a gift, ITP and AJD if a loan

A taxpayer has enquired about the taxation and documentation required for funds provided by parents to cover a house deposit. The DGT clarifies that taxation depends on whether the transaction is structured as a loan or a gift.

The question raised

Taxation of the transaction and how it must be documented.

The DGT's ruling

If the transfer of money is a loan, it is subject to but exempt from Transfer Tax and Stamp Duty, although the obligation to file the tax return persists. If the transfer is a donation, it is subject to Inheritance and Gift Tax. The DGT does not rule on the method of documentation or the place of delivery.

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