Below is an article from Vera Liprandi of De Cotta Law, Tenerife.
For more information, book your FREE consultation on November, Tuesday 13th, during our Open Day, in partnership with BlevinsFranks.
Inheritance tax increases for the residents
in the Canary Islands
On the 25th
of June 2012 the Canary Islands Parliament approved Law 4/2012 which established
various measures to preserve the provision of basic public services in the islands during the economical
downturn. In particular the law established several tax increases and abolished
the 99.9% allowance which was applicable to the inheritance tax payable by
parents, children and spouses who were residents in the Canary
Islands.In Spain the
autonomous regions are allowed to set their own inheritance tax levels and
allowances, these were drastically reduced by the new law. De Cotta Law has prepared an easy to understand
article detailing the main inheritance tax allowances applicable to the
residents in the Canary Islands from the 1st
July 2012.Taxable
beneficiaries are divided into four distinct groups which are taxed in a
different way:-
Group I:
Descendants and adopted children under twenty-one years.-
Group II:
Issue and adopted issue of twenty one years or more, spouses (or “parejas de
hecho”), parents and adoptive parents.-
Group III:
Relatives of the second degree (brothers/sisters) and third degree
(uncles/aunts, nephews/nieces), and their ascendants and descendants.-
Group IV:
Relatives of the fourth degree (cousins) and more distant relatives, and
strangers (including non adopted stepchildren).
According to the new law the allowances applicable to the residents in
the Canary Islands are:
- Group I
beneficiaries receive a 100% tax allowance up to a maximum of: a. €138,650
if they are under 10 years; b. €92,150 if they are 10 years old and under
15 years; c. €57,650 if they are 15 years old and under 18 years; d.
€40,400 if they are 18 years old and under 21 years.
- Group II beneficiaries receive the
following deductions from the taxable value: a. The spouse receives a
deduction of €40,400, b. Children and adopted children of twenty-one years
or more receive a deduction of €23,125; and c. The rest of descendants, parents
and adoptive parents receive a deduction of €18,500.
- Group III
beneficiaries receive a tax deduction from the taxable value of €9,300.
- Group IV
beneficiaries receive no deduction.Further
allowances are established in case of disability of the inheritor, if the
inheritor is more than 75 years old, and also in relation to life insurances,
business and company shares, main home, “patrimonio histórico”, “patrimonio
natural” and if the same assets are the object of various transmissions subject
to inheritance tax in ten years.It must be noted that these allowances only apply for the estates of people who have been
resident in the Canary Islands for five years
and the beneficiaries are similarly resident. If both the deceased and beneficiaries
do not satisfy the residency requirement then the national state rules apply, and
these allow a deduction of just under €16,000 from the taxable
value for spouse, children and parents of the deceased and just under €8,000
for Group III beneficiaries.
De Cotta Law Open
Day – Tuesday 13th November
De Cotta Law,
the Firm of English Lawyers and Spanish abogados with offices in the Canary
Islands and Mainland Spain, are holding an
Open Day in Tenerife on Tuesday 13th
November 2012, from 9:30 to 17:00. Only on that day De Cotta Law specialist
Solicitor Jonathan Sutton will be available for free consultations on English
law and in particular on the effects of the new European Regulation 650/2012 on
inheritance and how this will affect YOU.
Jon
will be able to advise our clients on English wills, inheritance tax and
Probate, litigation and personal injury claims and how a claim can often be
brought in the UK even if
the accident was in Spain.
All attendants will also have the possibility to meet and receive free
financial advice from the financial adviser Paul Montague, Blevins Franks, who
will also be present on that day.
All
legal consultations throughout the day will be completely FREE; to book your
private consultation please call our office on 922 719 520 or send an email to [email protected]
Visit
De Cotta Law’s offices, opposite The Scotch Corner bar, in San Eugenio, Playa
de Las Americas, Adeje and take advantage of a free, private legal
consultation.
De
Cotta Law- Over 25 Years Experience in Spain
De
Cotta Law
Avda. de los Pueblos Esq. C/ Colón
Parque Residencial Villaflor, Local B-20, 1ª Planta
San Eugenio, Playa de Las Americas
38660 Costa Adeje, Tenerife
España
Tel.: (00 34) 922 719 520
Fax: (00 34) 922 724 511
Email: [email protected]
Website: www.decottalaw.com