THE ACCUMULATION OF DONATIONS.

THE ACCUMULATION OF DONATIONS.

 

 

I have already expressed myself on other occasions about the complexity of the inheritance and gift tax, nowadays increased:

A.- due to the existence of different concurrent administrations and different partial regulations;

B.- due to the influence that community regulations have had on it;

C.- and due to the state legislator's forgetfulness of this tax (as an example, law 21/1987 is not adapted to the euro), because despite the fact that the autonomous communities have competences, these are limited, being the bulk of the regulations of a state nature.

1.- THE COMPETENCES OF THE AUTONOMOUS COMMUNITIES

Law 14/1996, of December 30, on the transfer of State taxes to the Autonomous Communities and complementary fiscal measures, in its article 15 determines that, in relation to the regulations of Inheritance and Donations Tax, the Autonomous Communities may regulate :

(...) the determination of the amount and coefficients of the pre-existing patrimony, and the setting of the rate whose progressivity must be similar to that of the State, being identical to that of the latter in terms of the amount of the first tranche of the tax base and minimum marginal rate.

In the case of "mortis causa" acquisitions, reductions in the tax base may be regulated, and those of the State must be maintained in conditions similar to those established by it and may create others that respond to circumstances of an economic or social nature, typical of the Communities. Autonomous, as long as they do not imply a reduction in the overall tax burden for this tax (...).

In use of their powers, there are Autonomous Communities that have left the inheritance tax practically non-existent, as is the case of Madrid or Andalusia (at least in the transmissions that occur between ascendants, descendants and spouses) while in others, it is a tribute that requires significant economic efforts to the long-suffering taxpayer.

This matter is currently on the political scene, and it is impossible for us to see changes.

An anomaly that occurs, in my opinion, in the tax derives from the regulation of the accumulation of donations and how this is done in the event that there are different autonomous communities interested.

2.- PURPOSE OF THE ACCUMULATION OF DONATIONS.

The purpose of the rule of the accumulation of donations derives from the fact that the tax rate of the donation tax is progressive, that is, it increases, depending on the amount of the tax base.

Thus, less is paid for three donations of 100,000 euros than for a single donation of 300,000 euros.

In accordance with state regulations or in general, if there are no reductions in the base or bonuses in the quota and without a multiplier coefficient, each donation of 100,000 euros would pay approximately 12,488.34 euros (average rate of 12.48%), while a donation of 300,000 would pay 55,879.62 euros (average rate 18,62%).

The difference is 18,414.60 euros.

To avoid the picaresque of dividing donations, article 30 of the inheritance and donation tax law stated in its original wording:

1.- The donations that are granted by the same donor to the same donee within a period of three years, counting from the date of each one, will be considered as a single transfer for the purposes of the liquidation of the tax, for which reason the tax quota will be obtained based on the sum of all tax bases. The quotas previously paid for the accumulated donations will be deductible from the liquidation that is practiced as a consequence of the accumulation.

That is, all donations from the same donor to the same recipient made within a period of three years were considered as a single donation, for tax purposes.

The tax bases were added and what was previously paid was subtracted, so that the same was paid for the donation of a good or an amount of money, once or several times, within a period of three years.

This regulation that made all its sense when there was a single inheritance and gift tax regime for the entire national territory, as it was until December 31, 1996, when it became a tax ceded to the autonomous communities. , and that caused the modification of article 30 of the inheritance tax law, which currently says:

Donations and other comparable “inter vivos” transmissions that are granted by the same donor to the same donee within a period of three years, counting from the date of each one, will be considered as a single transmission for the purposes of the liquidation of the tax. To determine the tax rate, the average rate corresponding to the theoretical taxable base of the total accumulated acquisitions will be applied to the taxable base of the current acquisition..

This precept must be completed with article 32 of Law 22/2009, of December 18, which regulates the financing system of the Autonomous Communities of common regime and Cities with Statute of Autonomy and modifies certain tax regulations, which For the purposes of distributing the money collected between different interested autonomous communities, it tells us:

When in a single document different assets or rights are donated by the same donor in favor of the same grantee and by applying the connection points, the yield must be understood as produced in different Autonomous Communities, each one of them shall be responsible for the result of applying , to the value of those donated whose performance is attributed to it, the average rate that, according to its rules, would correspond to the value of all those transferred.

When it is appropriate to accumulate donations, the yield resulting from applying, to the value of the assets and rights currently transferred, the average rate that, according to its regulations, would correspond to the value of all accumulated donations, will correspond to the Autonomous Community. For these purposes, all accumulated assets and rights shall be understood to be those from previous donations and those that are the object of the current transfer.

From then on, the tax bases are not added, but the average rates of each Community are applied to the set of accumulated donations, as we will see later.

3.- AUTONOMOUS COMPETENCES ON STAGE.

The tax regulations of each autonomous community are applicable when dealing with real estate, these are located in the territory of that Autonomous Community; and in the case of other assets and rights, the tax will be paid in the Autonomous Community and in accordance with its regulations where the donee has his habitual residence on the date of accrual.

The existence of different autonomous communities interested in the collection of the tax can lead to unwanted consequences, both for the amount to be paid, and for possible sanctions, if there is no correct advice.

4.- THE EXAMPLE.

To explain this whole situation, let's start with an example, in which a father donates to his son a flat in Madrid and a villa in Burgohondo (Ávila), each with an identical value of 200,000 euros.

First assumption.- The donation of the two assets is made on the same day and in the same deed.

In this case, there would be a settlement of 200,000 euros in the Community of Madrid and another settlement of 200,000 euros in the Community of Castilla León, but applying in both the average rate corresponding to a donation of 400,000 euros, as a result of the joint interpretation of the article. 30 of the inheritance tax law and article 32 of Law 22/2009, of December 18.

The tax quota in Madrid would be 404.60 euros, having a bonus of 99%, while the tax quota in the Community of Castilla León, (none of the reductions provided for in its regulations (specified in donations to protected heritage ; money destined to the acquisition of the first habitual residence, donation of individual companies or professional businesses and/or money destined to its constitution or expansion; or donations to victims of terrorism and not being the subsidized tax rate), the amount to enter would be 40,460 euros.

Total to pay, for both donations, 40,964.40 euros.

Let's see graphic examples of the above:

MADRID
TAXABLE BASE 200.000,00 €
AVERAGE RATE CORRESPONDING TO 400,000 Euros 20,23%
TAX RATE 40.460,00 €
BONUS 10% 40.055,00 €
TO ENTER 404,60 €

 

CASTILE-LEON
TAXABLE BASE 200.000,00 €
AVERAGE RATE CORRESPONDING TO 400,000 Euros 20,23%
TAX RATE 40.460,00 €
BONUS 0% 0,00 €
TO ENTER 40.460,00 €

What is surprising is that, literally applying article 30 of the inheritance tax law, (“The average rate corresponding to the theoretical nettable base of the total accumulated acquisitions will be applied to the net taxable base of the current acquisition”). If the donations are not made in the same document, we would go to one of the following two cases.

Second assumption.- The father donates the apartment in Madrid, and later, but before three years have elapsed, he donates the villa in Burgohondo.

The donation of the Madrid flat would be calculated on a taxable base of 200,000, according to the average rate resulting from these 200,000 euros, and since the fee is subsidized to 99%, it would give an amount to enter of 316.21 euros.

But in the donation of the Burgohondo villa, the value of the Madrid villa would be added to its value, since as indicated in article 30 of the inheritance tax law, to determine the tax rate, the taxable base of the current acquisition will be applied to the average rate corresponding to the theoretical net payable base of the total accumulated acquisitions.

That is, the second donation in Castilla-León would be considered a donation of 200,000 euros, but the average rate would be applied to an acquisition of 400,000 euros and would pay 40,640 euros.

Total to pay, for both donations, 40,956.21 euros.

Let's see graphic examples of what has been exposed:

MADRID

TAXABLE BASE 200.000,00 €
AVERAGE RATE CORRESPONDING TO 200,000 Euros 15,81%
TAX RATE 31.621,21 €
BONUS 10% 31.305,00 €
TO ENTER 316,21 €
CASTILE-LEON
TAXABLE BASE 200.000,00 €
AVERAGE RATE CORRESPONDING TO 400,000 Euros 20,23%
TAX RATE 40.460,00 €
BONUS 0% 0,00 €
TO ENTER 40.460,00 €

Third assumption.- The father donates the villa in Burgohondo and later, but before three years have elapsed, he donates the apartment in Madrid.

The donation of the Burgohondo chalet would be calculated on a tax base of 200,000, and according to the average rate resulting from these 200,000 euros, which would give an amount payable of 31,621.21 euros; but in the donation of the apartment in Madrid, the value of the villa in Burgohondo would be added to its value, since as we have said to determine the tax rate, the average rate corresponding to the theoretical taxable base of the total cumulative acquisitions.

That is, the second donation in Madrid would be considered a donation of 200,000 euros, but the average rate would be applied to an acquisition of 400,000 euros and would pay 404.60 euros.

Total to pay for both donations: 32,025.81 euros.

Let's see graphic examples of what has been exposed:

CASTILE-LEON
TAXABLE BASE 200.000,00 €
AVERAGE RATE CORRESPONDING TO 200,000 Euros 15,81%
TAX RATE 31.621,21 €
BONUS 0% 0,00 €
TO ENTER 31.621,21 €
MADRID
TAXABLE BASE 200.000,00 €
AVERAGE RATE CORRESPONDING TO 400,000 Euros 20,23%
TAX RATE 40.460,00 €
BONUS 10% 40.055,00 €
TO ENTER 404,60 €

The casuistry that can occur is enormous, taking into account that there are 17 different tax regimes in Spain.

To give another example, let's imagine that a father decides to donate a villa in Galapagar to his son, for a value of 600,000 euros. And after two years he decides to donate a house on the Costa Brava, which he bought on the advice of a former activist friend from Barcelona.

The donation from Madrid, according to the average rate resulting from these 600,000 euros, and since the fee is subsidized to 99%, would give an amount to be paid of 1,213.80 euros.

For its part, the donation from the house on the Costa Brava would pay over 200,000 euros, but when the value of the donation from Madrid was added to it, it would pay for the average rate of a 7%, that is, a total of 14,000 euros.

5.- CRITICAL VISION.

The regulation of the accumulation of donations could make sense, in the original wording of the law in a context of a single administration and a single legislation for the entire State, and on the basis of accumulating tax bases.

And we must remember that donations to the donor's inheritance also accumulate, if 4 years have not elapsed since the donation and the death of the donor,

With several applicable laws, very difficult to interpret and apply by a taxpayer, with different criteria to set tax benefits, subject to a self-assessment regime, with computer systems not specially programmed for these purposes and in the face of various voracious administrations. , I can only think that the argument for its maintenance is to have an ace up its sleeve to punish an error or mistake by the taxpayer, even without any desire to defraud or deceive.

I am not talking about justice, but about the coherence of a system, which, if maintained, should be linked to a unification of the regulations of the Autonomous Communities, limiting their competence to the power to set bonuses in the quota. Either that, or maintain the accumulation when the same administration is competent.

The fact that the order of each of the documents can influence total taxation seems nonsense to me.

WE NEED CLEAR RULES NOW.

 

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