“Knowing how to choose time is saving time.” Francis Bacon.
One of the outstanding sections of our office is the strategic management of heritage, an area in which you have to keep in mind, both the present factor and the future factor. Taking advantage of the margins of the present can maximize what later the state of a thick patrimonial thickness given, however, an inefficiency in the resources of the past, may do so to diminish. Thus we start with an important novelty in the heritage area. Today we analyze an important fiscal novelty belonging to the Generalitat Valenciana for 2017.
The Draft of the Law on Fiscal Measures, Administrative and Financial Management and Organization of the Generalitat Valenciana 2017 has introduced significant novelties in regards to the tax on the Tax on the Tax Rent of natural persons, as well as on the tax on inheritance and donations. These are modified through Chapter II of Law 13/1997, of December 23, of the Autonomous section of the Income Tax of the natural persons and remaining taxes assigned, among which we found the aforementioned.
The first thing we have clear: changes in heritage management, both present personal, and in the possible inheritance or donations inter vivos, thus activating what we commented at the beginning will occur: The time to make changes.
Reductions in Mortis Causa ·
The first changes are observed in:
– Art 10, AP2, 1st and 3rd, on the transmission of an individual agricultural company and individual company or professional business, respectively.
– Art 10, AP2, 4th, on the transmission of entities.
In both cases, a basic point is added to the requirements:
1) That the activity does not constitute the main source of income of the deceased.
2) That the deceased has exercised said activity in a regular, personal and direct way.
3) That the net amount of the company’s business figure enables the application of tax incentives for reduced dimension entities.
4) That the company, in this acquired route, remains in the acquirer’s assets during the five years of the death of the deceased (…)
Second, in regards to the transmission of participations in entities, art 10, AP2, 4th exposes:
1) That the entity does not have as main activity the management of real estate or furniture (…)
2) That the net amount of the company’s business figure enables the application of tax incentives for reduced dimension entities.
3) That the participation of the cause in the capital of the entity is at least 5% or 20% jointly (…)
4) That the deceased or any of the people of the family group effectively exercise management functions in the entity (…)
Reductions in inter -living transmissions
In this case, what happens is a considerable decrease in the minimum amount of pre -existing heritage, which was previously set at € 2,000,000 and now becomes € 600,000, therefore, the following text in Art. 10, Bis 3rd:
- Acquisitions for children or adopted under 21, who have a pre -existing heritage of up to € 600,000: € 100,000, plus € 8,000 for every year less than 21 that the donator has, without the reduction can exceed € 156,000.
- Acquisitions for children or adopted of 21 or more years and by parents or adopters, who have a pre -existing heritage, in all cases, of up to € 600,000: € 100,000.
Apart from these two issues, the same thing happens as with the previous Mortis Causa case, in which the same highlights are added to both texts already present.
Bonuses of the quota
The modifications occurred in this Draft Law 13/1997 GV, also reach the quota bonuses, where in art.12, bis 1º, we will now find:
1. They may benefit from the following bonuses on the part of the ISD tax quota that proportionally corresponds to the assets and rights declared by the taxpayer:
a) 75% bonus of mortis acquisitions cause relatives belonging to Group I of Art20.2.A of Law 29/1987, of December 18 of ISD.
b) Bonus of 50% of the Mortis acquisitions cause in relatives of the deceased belonging to Group II of Art.20.2.A of Law 29/1987, of December 18 of the ISD.
c) A 75% bonus Mortis acquisitions causes physical or sensory disabled with a degree of disability equal to or greater than 65% or by psychic disabled with a degree of disability equal to or greater than 33%.
The application of this bonus will exclude that of sections a) or b). Bonuses are eliminated in quota for inter living acquisitions.
New Quarter
New conditions are added in the Quarter of Art.12, in relation to the assimilation to spouses of the de facto couples:
The members of de facto couples whose union meets the requirements established in Law 5/2012, of October 15, of A Generalato, of formalized facts of the Valencian Community are assimilated to spouses and are registered in the Formalized de facto union registration of the Valencian Community.
How to react to changes in donation tax
As observed, the changes that have occurred in the donation tax are reduced in the minimum to begin applying the bonuses, or failing that, to begin to pay the corresponding taxes. That is why the timely measure of a fiscal nature, in this sense, can be changes in the current ownership of companies or participations. In Verum Management we are specialists in this type of operations. If you need more information, contact us at info@verumasesores.com
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