Reached an age, one of the most important moments in a person’s life comes when they must decide the future of their property, real estate and other belongings. The most common option is inheritance.however, in the last year, propelled by the uncertainty about the future that the coronavirus pandemic has brought, we have seen how donations have also increased, reaching record figures in Spain.
What are donations?
If we abide by its purest definition, donations are voluntary agreements reached between two parties, the one that gives something and its corresponding contracting party. “Unlike inheritances, which are mortis causa, donations are inter vivos, so the transfer always occurs before death,” they point out to 20 minutes from the office Sanahuja Miranda Abogados.
They are usually made to the couple
Donations, in short, are works without price or influence accepted in life by one or several recipients, who in most cases are usually couples or married couples.
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When making a donation, explain Arantxa Goenaga, partner at Círculo Legal Barcelona, the owner must prove that he freely disposes of the property in question and that, after the donation is effective, he will not be left without assets or assets. “Once these requirements are met, the donation, which must be made before a Notary public deed, must be accepted by the donee,” he adds.
During this process, moreover, relevant taxes must be paid. Therefore, to the notarial deed and registration expenses, the taxes corresponding to the donor and donee must be added, which, being of regional competence – donations and successions – will vary depending on the place where it takes place.
How much does the donation process cost?
As he explains, Abel Marín, partner of Marín & Mateo Lawyers and author of the book ‘Protect your inheritance’, “depends on many factors, such as whether it is a donation of money or real estate, the degree of kinship between donor and donee, the amount of the donation and the legislation of each Autonomous Community”.
What differences do they have with inheritances?
The main difference lies in the moment in which they occur, since donation requires that the donor be alive, while inheritance is mortis causa.
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With regard to economic terms, the choice between donating during life and leaving as an inheritance will depend on the Autonomous Community to which one belongs. In this sense, Goenaga clarifies that “depending on the circumstances, one operation or another may be more interesting, but what is clear is that all assets cannot be donated and it will be understood that it is an inheritance.”
For its part, Abel Marín, he has it clearer and considers that “in most cases”, it is best to leave a property in inheritance.
The donations generate a series of personal and family problems that later cannot be fixed even with all the gold in the world
The donations, as they occur before the death of one of the parties, and despite possible advantages from the fiscal point of view, “generate a series of personal and family problems that later cannot be fixed even with all the gold in the world.”
In this regard, he adds: “The imbalance of donations in life to different children generates in some cases conflicts that break family harmony (envy, jealousy, comparative grievances…)”. In addition, he adds: “The later ungratefulness or neglect of children generates in many cases suffering in the parents. Let’s keep in mind that life takes many turns.
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In the event that the donor regrets his action, they express from Marín & Mateo Abogados, the Civil Code distinguishes a series of causes for which the revocation of the donation can be caused: “That the donor who does not have children or descendants have them after the donation is made or the child who was believed dead when the donation was made appears alive, that the donee has not complied with any of the conditions that the donor imposed when making the donation, or cases in which the donee commits a crime against the donor or improperly withhold food.
Advantages of donations
The main advantages presented by donations, emphasize sources from Sanahuja Miranda Abogados, are fiscal naturesince some Autonomous Communities contemplate bonuses for taxes related to this process, and, in the specific case of personal income tax, for those over 65 who donate their habitual residence.
“Beyond the differences, from the fiscal point of view, existing between Autonomous Communities, making a living donation will allow the donor to establish clear conditions for the delivery of the homes,” they clarify from Sanahuja Miranda.
Another factor to take into account in the case of having a large patrimony is that donating in life will allow “go lightening the hereditary mass” for a future inheritance, says Abel Marín.
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drawbacks
Ultimately we must talk about the drawbacks. Two factors stand out in this section: obligation to pay personal income tax by the donor and, more importantly, the impossibility of revoking the decisionsince the civil code contemplates only very specific cases.
“It is not uncommon for donors to repent after a time of the donation made in favor of children who subsequently have unworthy behavior towards their parents. Therefore, I advise you to think about it carefully,” concludes lawyer Marín.
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