The Canary Islands Budget Law for 2020 came into force on 01/01/2020 and includes the following tax changes: the IGIC general rate (the general Canary Islands VAT rate) increased to 7%; in respect of Inheritance Tax, the 99.9% allowance is applicable to Group I beneficiaries (descendants/adopted children under 21 years) and a variable progressive relief is applicable to Group II (issue and adopted issue of 21 years or more, spouses, parents) and Group III (brothers/sisters, uncles/aunts, nephews/nieces, etc.) depending on the amount of the inheritance tax to be paid by each tax payer: in this case the 99.9% inheritance tax allowance is applicable up to 55,000€ and then reduced allowances are applicable to the amount of the tax to be paid as from 55,000€ – if the total inheritance tax to be paid is more than 305,000€ the allowance will only be a 99.9% on 55,000€.
In respect of Donation Tax, the same variable progressive relief is applicable to Group II, and the 99.9% allowance is applicable to Group I. For more information or a consultation please call us on 922 719520 or email [email protected]