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V3351-14 18 December 2014 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · explotación agraria prioritaria

75% tax base reduction applicable to partial transfers of priority agricultural holdings

The DGT has addressed whether transfers between members of a partnership (Comunidad de Bienes) involving a priority agricultural holding qualify for reductions under Law 19/1995, and whether these are compatible with Inheritance and Gift Tax reductions. The DGT ruled that the partial transfer of a partner's share is compatible with the reduction under Article 11, but warned that reductions under both laws cannot be applied simultaneously.

The question raised

Compatibility of the planned operations with the reductions provided in Articles 9 to 11 of Law 19/1995, of July 4, on the modernization of agricultural holdings. Compatibility of such reductions with those provided in the Inheritance and Gift Tax Law.

The DGT's ruling

The transfer of the total or partial interest of a co-owner in a Community of Property that constitutes a priority agricultural holding may qualify for the 75% reduction provided for in Article 11 of Law 19/1995. It is not possible to apply the benefits of Articles 9 and 10 due to failure to meet the requirements of integrity or completion of boundaries. The reductions under Law 19/1995 and those under the Inheritance and Gift Tax Law are incompatible with each other due to overlapping factual scenarios.

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