inheritance tax deductions aragon

Inheritance Tax DeductionsIn Aragón

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This presentation has been updated and is valid for 2014.

Inheritance Law in Aragón

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While in most autonomous communities in Spain matters of

inheritance are regulated by state legislation, Aragón is one

of the few that has retained competency to legislate

completely in this area – Article 3 Law 28/1990.

Inheritance Law in Aragón

The regional level deductions available in Aragon were

enacted by the parliament in Zaragoza and in their current

form are specified in Legislative Decree 1/2005 as modified

by Law 19/2006, Law 8/2007, Law 11/2008 and Law

12/2010.

Inheritance Legislation in Aragón

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The following categories of exemption are the most important

and likely to be of general application:

Inheritance Tax Deductions in Aragón

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If the beneficiary is disabled

A deduction of 100% may be applied to any beneficiary with

a disability classified to be of a degree greater than 65%

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If the beneficiary is below the age of majority

A deduction of 100% may be applied to any beneficiary who

is under the age of majority

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Deductions in transfer of Family Business

Tax deduction of 99% of the value of the business

Must be children or spouse to benefit from the deduction

Only if no spouse or children may apply deduction to any

relative 'to third degree of consanguinity'

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Deductions in transfer of Family Business

The business may not be sold by the heirs who benefit

from this deduction for a period of 5 years

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Inheritance of the Family Home

The spouse, descendants, parents or any elderly relative

who has lived with the deceased for two years prior to

their death may deduct 99% (Law 19/2006) of the value of

the main family home that they each inherit up to a limit of

125,000€

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Inheritance of the Family Home

The property may not be sold for a period of 5 years after

the inheritance. The limit to this deduction is set at

€125,000 by Article 3(1) of Law 12/2010.

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Special Deduction in the Taxable Sum for Specific Beneficiaries

Where the beneficiary is the spouse, child or parent of the

deceased then a deduction may be made of 100% of the

amount remaining after deductions, including income derived

from a life insurance policy held by the deceased where:

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Special Deduction for Specific Beneficiaries

1) where the total amount of all other deductions (excluding life

insurance policies) does not exceed €150,000

2) the total amount of this deduction, excluding income from a

life insurance policy shall be no greater than €150,000

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Special Deduction for Specific Beneficiaries

3) Should the deceased have left children who are minors then the amounts specified may be increased by a further €150,000

4) If a child predeceases their parent then any deduction may be

passed to any grandchildren

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Special Deduction for Specific Beneficiaries

5) If any of the beneficiaries are disabled to a degree greater

than 33% and less than 65% (as per statutory definitions) then

the amount of the deduction may be increased to €175,000

6) The total pre-existing net worth of the beneficiary is under

€402,678

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Special Deduction for Specific Beneficiaries

7) This deduction will not apply if the beneficiary has received a

gift from the deceased in the period 5 years prior to the date of

death, unless the gift was below 150,000€ in value (with a

percentage of such gifts deductible if made with the objective of

creating a business

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Other Special Deductions:

A general discount of 50% of the taxable base subject to inheritance tax will be applied in 2014 to all beneficiaries in Groups I & II, rising to 100% in 2015.

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Other Deductions:

As a general rule the following deductions may be made on any estate:

Funeral Expenses

Final Medical Expenses of the Deceased

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Other Deductions cntd:

Debts held be the deceased that are evidenced by public

documents e.g. a mortgage

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Once all deductions have been applied the final amount of tax

payable is determined then it is necessary to apply the relevant

rate:

Inheritance Tax Rates in Aragón

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Inheritance Tax Rates in Aragón

Taxable Sum Tax Payable On This Sum

Any Remainder Up To

Applicable Rate on Remainder (%)

0 0 7993,46 7,65

7993,46 611,5 7987,45 8,5

15980,91 1290,43 7987,45 9,35

23968,36 2037,26 7987,45 10,2

31955,81 2851,98 7987,45 11,05

39943,26 3734,59 7987,46 11,9

47930,72 4685,1 7987,45 12,75

55918,17 5703,5 7987,45 13,6

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Inheritance Tax Rates in Aragón

Taxable Sum Tax Payable On This Sum

Any Remainder Up To

Applicable Rate on Remainder (%)

63905,62 6789,79 7987,45 14,45

71893,07 7943,98 7987,45 15,3

79880,52 9166,06 39877,15 16,15

119757,67 15606,22 39877,16 18,7

159634,83 23063,25 79754,3 21,25

239389,13 40011,04 159388,41 25,5

398777,54 80655,08 398777,54 29,75

797555,08 199291,4 en adelante 34

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Existing Wealth

Once the relevant tax rate has been applied the result is multiplied by a coefficient determined by the existing wealth of the beneficiary as well as the group to which they belong:

Existing Wealth Groups

(In Euros) I & II III IV

0 to 402,678 1 1.5882 2

402,678 to 2,007,380 1.05 1.6676 2.1

2,007,380 to 4,020,770

1.1 1.7471 2.2

More than 4,020,770 1.2 1.9059 2.423

Existing Wealth

The Groups referred to consist of the following beneficiaries:

Group I Children, including adopted children, under the age of 21

Group II All other descendants, spouses and parents

Group III Close relatives such as brothers and sisters, grandparents,

aunts and uncles

Group IV More distant relatives

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Each year in Spain thousands of expats pay more

tax on inheritance than they should – simply

because they fail to follow some simple rules.

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To find out where to get expert advice, in English, about how

to reduce your liability for inheritance tax, go to:

Saving on Probate Services in Aragon

Expert Probate Services in Aragón

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