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V2404-19 12 September 2019 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · reducción en la base imponible

95% reduction on donation of shares applicable if Wealth Tax exemption is met

A taxpayer inquired whether they could apply regional reductions from the Generalitat Valenciana or the state-level reduction to a donation of shares. The DGT stated it lacks jurisdiction over Valencian regulations and outlined the requirements for the state-level reduction.

The question raised

Whether the reduction established by Law 13/1997, of December 23, of the Generalitat Valenciana, or, failing that, the reduction established by Article 20.6 of Law 29/1987, may be applied.

The DGT's ruling

The 95% state reduction on inter vivos transfers of shares requires that the same be exempt from Wealth Tax. To this end, the kinship group must hold at least 5% individually or 20% collectively, and at least one member must perform management functions with remuneration exceeding 50% of their income. Furthermore, the donor must be 65 years of age or have a disability, and the donee must maintain the acquisition and the exemption for ten years.

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