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V4407-16 14 October 2016 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
ISD · transmisión intergeneracional

Reduction for transfer of economic activity may apply even if furniture and stock are sold separately

A query was raised regarding whether the reduction under Article 20.6 of the Inheritance and Gift Tax Act applies to a donation of a pharmacy licence and facilities where furniture and stock are sold separately. The DGT ruled that the reduction is indeed applicable to the value of the donated elements.

The question raised

Applicability of Article 20.6 of the Inheritance and Gift Tax Law.

The DGT's ruling

The gratuitous transfer of a business license and facilities falls within the purpose of facilitating the intergenerational transfer of economic activities. This is valid even if other integrated elements, such as furniture and stock, are transferred for consideration. The reduction shall be applied to the real value of the assets subject to the donation.

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