Gift tax Spain: Rates, Calculation and Exemptions (Guide 2025)

Do you pay gift tax in Spain when transferring property? Yes, Spanish gift tax (Impuesto sobre Sucesiones y Donaciones) is always payable when donating Spanish property, regardless of whether you are a resident or not. Although national rates reach 34%, autonomous regions determine the final bill. In regions such as Valencia and Andalusia, high exemptions as well as tax rebates (up to 99%) mean that the effective tax burden for family members is often minimal.

When is Spanish gift tax due?

The Spanish tax authorities look at two criteria: the location of the asset and the residence of the recipient. You are liable to tax in Spain in two cases:

• As a resident: You live in Spain and receive a gift (worldwide assets).

• As a non-resident: You live in Belgium/Netherlands, but receive an asset located on Spanish territory is located.

Note that as a resident in Spain, you may pay double gift tax.

Rating: The 'Valor de Referencia'

Since 2022, you are not allowed to simply estimate market value. The taxable base is the top of these two:

1. The value in the notarial deed.

2. The Valor de Referencia: The official reference value established by the Spanish Land Registry.

How is gift tax calculated? (Correct Roadmap & Example)

The calculation differs by region. We use here the specific calculation model for the Comunidad Valenciana (Alicante, Valencia, Castellón), as this is the most popular region for many Belgians.

The Calculation Model:

1. Valuation: Total value of property (or bare ownership share).

2. Application Exemptions (Reducción): Depending on the relationship between donor and donee, exemptions are applied. In Valencia, a tax-free sum (e.g. €100,000 per child) is first deducted from the value.

3. Application Rates: On the remaining amount (the 'Base Liquidable'), the progressive tax rates are applied.

4. Application of coefficients: depending on the relationship between donor and donee, the tax payable is multiplied by a coefficient, e.g. 1 or 2.

5. Bonification (Discount): Finally, a rebate of 99% is added to the calculated tax amount.

Calculation example: Gift of Bare Property to two children (Valencia)

The Situation:

• Donors: Parents (aged 65).

• Recipients: 2 children.

• Object: Holiday home in Alicante (Valencia) with a market value of € 350.000.

• Transaction: Donation of the bare ownership; parents retain usufruct.

Step 1: Valuation of Bare Property

The value of the usufruct depends on the age of the youngest donor (89 - age).

• Age: 65 years. Usufruct = 24% (89 – 65).

• Bare ownership = 76% (100 – 24).

• Total endowment value: € 350.000 * 76% = € 266.000.

Step 2: Distribution per child

The gift is divided between two children.

• Value per child: € 133.000.

Step 3: Regional Exemption (De 'Reducción')

In the Comunidad Valenciana, children (Group II) benefit from a reduction in the taxable base of €100,000.

• Taxable base per child: €133,000 - €100,000 = €33,000.

  (This is the amount on which the tax is calculated, not the full €133,000).

Step 4: Tax calculation (Scale)

On the remaining amount of €33,000, the rates are applied (between 7.65% and about 11%).

• The gross tax (Cuota íntegra) in this case amounts to about € 2.767 per child. The applicable coefficient in this case is 1. € 2.767 * 1 = € 2.767.

Step 5: The Bonification (99%)

To this calculated tax amount, Valencia applies a discount of 99% for timely payment and correct declaration.

• Discount: - €2,739.33.

• Gift tax payable per child: €27.67.

Conclusion: Thanks to the combination of the exemption (€100k) AND the bonification (99%), the children in this example pay only a few tens of euros in gift tax.

Note: This applies specifically to Valencia. Other regions have different rules.

The Real Cost: Capital gains tax & Plusvalía

Just because the gift tax is low does not mean the transaction is free. There are two "forgotten" taxes:

1. Plusvalía Municipal (For the receiver):

   A municipal tax on land appreciation. It must be paid by the children to the municipality.

2. Capital gains tax (For the donor):

   The parents are taxed in Spanish income tax as if they had sold the house. Has the house become worth more since the purchase? Then the parents pay 19% to 28% tax on that "gain" even if they do not receive any money.

Consequences for Belgium?

Is donating in Spain detrimental to your Flemish or Belgian taxes?

No.

• Exemption in Belgium: Because the gift is registered by a Spanish notary and Spanish tax (however little) is due, in Belgium no gift tax due.

• No 'Revival effect': The donated house does not count to push up the rate of later inheritance in Flanders.

• Strategy: Do you have property in both countries? If so, donate the Spanish property first. This is often the cheapest way to plan your global estate. Why donate foreign property first?

Decision: To donate or not to donate?

Donating in regions such as Valencia is very attractive fiscally for the recipient (the children) due to the dual effect of the €100,000 exemption and the 99% bonus. However, the decision depends on the capital gains tax for parents.

• Donating is ideal if: The capital gain on the property is limited (recently bought) or if you want to keep the property in the family for a long time.

• Waiting for legacy is better if: There is a huge capital gain on the house (e.g. bought cheaply 20 years ago). This is because on death, this capital gains tax expires.

Frequently asked questions (FAQ)

Is the €100,000 exemption valid throughout Spain?

No, this exemption is specific to certain autonomous regions such as the Comunidad Valenciana. Other regions such as Andalusia or Murcia have their own systems, some of which are even more favourable or have different conditions.

Do I pay tax in Belgium on a Spanish real estate donation?

No, foreign real estate gifts are exempt from gift tax in Belgium. Read more about Belgian and Spanish inheritance tax.

What if the value of my donation exceeds the exemption?

If the value per child exceeds €100,000 (in Valencia), you will pay tax on the portion above €100,000. However, on the tax amount due, you will usually get the 99% bonus after that, keeping the final bill low.

Can I avoid capital gains tax for the donor?

In most cases, no. There are exceptions, for example if the donor is over 65 years old and donates his/her main residence (which rarely applies to Belgians with a holiday home), or if the property was purchased before 1994 (deductions old regime).

About the author: Glenn Janssens is a lawyer specialising in Spanish real estate transactions and tax regulations. Since 2017, he has been helping Belgian and Dutch individuals and entrepreneurs to safely purchase and structure real estate in Spain. He guides files from A to Z: from due diligence, ownership and tax control to estate planning and optimisation for residents and non-residents. Thanks to his years of experience, hundreds of handled files and focus on transparent communication, Glenn makes complex Spanish legislation understandable and practically applicable for every property buyer.