Skip to content
Back to index
V2675-20 2 September 2020 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · hecho imponible

Mortgage debt cannot be deducted from ISD if it does not correspond to the legatee under the will

A legatee inquired whether she could deduct a reverse mortgage from an inherited property and assume the debt alongside other legatees. The DGT ruled that only debts specified in the will may be deducted, and assuming another person's debt constitutes a gift.

The question raised

Taxation under the Inheritance and Gift Tax.

The DGT's ruling

The settlement of the estate must be carried out in accordance with the will, therefore a debt that does not correspond to the legatee cannot be deducted. If the legatee assumes the debt of another without consideration, a new taxable event occurs by way of a gift. In this case, the heir would be the taxable person for said gift.

Book your free first meeting