The Region of Murcia 2018 Budget Law (Law 7/2017 passed on 21st December 2017) sets new tax benefits on Inheritance Tax and Gift Tax, and at the same time, some other benefits have disappeared.
The following tax deductions are also applied to Non-Residents, as long as they are fiscal residents of a European Union Country, which leaves UK tax residents in an unknown position in the distant future.
This is a summary of those important changes on Inheritance and Gift Taxes, which came into force on the 1st of January 2018:
1. Inheritance Tax.
A tax reduction of 99% in any inherited good as long as inheritors are spouses, parents or children.
The former tax deduction for inheriting farming land disappears.
Reductions in the inheritance of business are extended to distant relatives.
2. Gift Tax.
A tax reduction of 99% in any gifted good as long as inheritors are spouses, parents or children. It is worth pointing out that in case of gifting a property or any other but cash, the donor may be subjected to Capital Gains Tax in case that the value of the good is higher when it is gifted.
On the other hand, Plusvalia Tax (Local Capital Gains Tax) is applied.
The following tax deductions disappear:
a. Cash for property purchase.
b. Cash for a business purchase.
c. Plots for building the usual dwelling.
e. Real-estate property for business purposes.