Skip to content
Back to index
V3060-23 23 November 2023 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · hecho imponible

Life insurance payouts must be subject to Inheritance Tax

A query was raised regarding whether life insurance payouts, where the beneficiaries are the legal heirs, are subject to taxation. The Directorate-General for Tax Assurance (DGT) has ruled that receiving these amounts constitutes a taxable event under Inheritance and Gift Tax.

The question raised

Taxation of insurance.

The DGT's ruling

The receipt of amounts by life insurance beneficiaries, when the policyholder is different from the beneficiary, constitutes a taxable event for Inheritance and Gift Tax. If the beneficiary receives the money, they must pay tax on this concept and add said amount to the rest of the assets and rights received through inheritance. The DGT does not have the competence to determine who the legal heirs are.

Book your free first meeting