A transfer, deed or incorrect sequence can change the tax result and lose available relief. Before action, we establish where tax is due, the cost for both parties and the formal conditions that must be met.
Technical review: August 2026
The Inheritance and Gift Tax (IGT) is a tax levied on increases in wealth obtained by individuals free of charge (i.e., without consideration). The "Gifts" modality applies to gratuitous acquisitions made "inter vivos" (between living persons), such as a gift of money from parents to children or the gift of a property.
This tax is state-level, but its revenue is ceded to the Autonomous Communities (ACs), which have broad regulatory powers to govern key aspects such as reductions, allowances, and rates. This causes large differences in the tax burden of a gift depending on the AC involved.
The declaration of this tax is made by filing Model 651.
While Gifts tax gratuitous transfers during the donor's lifetime, Inheritance Tax taxes acquisitions due to death (inheritances, legacies). Understanding the differences is fundamental for proper estate planning.
The person obliged to pay Gift Tax is the donee, i.e., the person who receives the gifted assets or rights.
The competent Autonomous Community for the tax settlement (and therefore, the regional regulations to apply) depends on the type of asset gifted and the donee's tax residence:
Correctly determining the competent AC is crucial, as differences in tax benefits for gifts can be enormous. An error at this point can lead to paying much more tax than necessary or potential penalties. For example, a gift of money from parents to children can have very different taxation between ACs.
A non-resident donee has limited liability for assets and rights subject in Spain, but regional rules may apply according to the connecting factor. Spanish real estate connects to the Autonomous Community where it is located. Movable assets situated in Spain connect to the region where they were located for the greatest number of days during the immediately preceding five years. A Spanish-resident donee receiving foreign real estate connects to their region of residence.
The five-year period: it does not require five complete years of residence in one region. Days spent in each Autonomous Community during the immediately preceding five years are counted, and the region with the greatest number of days is selected.
The filing deadline is not uniform throughout Spain. The rules of the competent tax authority must be checked before the gift is formalised. In cases managed by the Spanish Tax Agency —including certain gifts involving non-residents— the period is 30 working days from the day after the act or contract. Madrid also uses 30 working days; Catalonia generally uses one month; and Andalusia, for taxable events from 2022, two months.
Late filing may trigger surcharges and late-payment interest and, where the statutory conditions are met following prior action by the tax authority, penalties. The applicable regional or State filing period should therefore be checked in each case.
The calculation of Gift Tax follows these general steps (simplified, as the specific regulations of each AC are decisive):
Need a first estimate for a cash gift or a gift of property? Use our Inheritance and Gift Tax calculator. The result is indicative only and must be checked against the rules and facts applicable on the tax accrual date.
Access IGT CalculatorAs mentioned, ACs have great capacity to modify Gift Tax, especially through reductions in the taxable base and allowances on the final tax liability. This means the amount payable for the same gift can vary enormously between territories, making it essential for estate planning.
Some of the most common reductions and allowances (always verify the specific regulations of the competent AC at the time of the gift!) are:
Usually the most significant. Many ACs offer very high reductions and/or allowances (up to 99% or 100%) for gifts between direct relatives (Group I: children and other descendants under 21; Group II: children and other descendants over 21, spouse, parents, and other ascendants).
Some ACs have specific reductions if the gift of money is intended for the purchase of the donee's first primary residence (especially for young people and under certain value and wealth limits).
Significant reductions (up to 95% or more) for the gift of shares in family businesses or individual professional practices, if strict requirements for maintaining the activity and shares are met.
Additional reductions exist if the donee has a recognized degree of disability, the amount of which varies by degree and AC.
The Community of Madrid provides significant reliefs, but their application depends on kinship, amount, documentation and, in some cases, the purpose of the gift:
Percentages alone are not enough: the required document, limits, aggregation rules and any maintenance or use conditions must be checked before the gift is executed.
Given the enormous differences between ACs, it is essential to analyze where and how to make a gift to minimize the tax impact. Proper planning can mean savings of thousands of euros in Gift Tax. Contact GESTISYD for personalized advice.
If your situation looks similar to any of these, we can help. If not, we will tell you straight away.
Even though the gift is gratuitous, the donor may have to declare a capital gain in their personal income tax (IRPF), equal to the difference between the property's acquisition value and its value at the time of the gift. The local municipal capital gains tax may also apply and is payable by the donee as the acquirer. This is one of the most common oversights in family gifts: planning Form 651 without assessing the full tax cost. At GESTISYD we always review the impact on both sides (donor and donee) before the gift is finalised.
Yes, in theory, all gifts are subject to tax, regardless of their amount. However, many ACs have exempt minimums or such high reductions/allowances for gifts between parents and children that, in practice, the tax payable may be zero. Even so, the obligation to file the return (Model 651) usually exists.
It depends on many factors and requires personalized estate planning: the applicable AC (allowances can differ for inheritance and gifts), the personal and financial situation of the donor and donee, objectives (helping during life vs. post-mortem transfer), and other taxes involved (such as Personal Income Tax for the donor for potential capital gains on gifting certain assets, like real estate).
You will pay Gift Tax in the Valencian Community, as that is where the gifted property is located. Valencian regulations will apply for the tax settlement.
Yes. The donee pays Gift Tax. For Gift Tax on real estate, the cadastral reference value applies, or the declared value if higher; where no certifiable reference value exists, the higher of declared value and market value applies. The donor must separately review any capital gain under Personal Income Tax valuation rules. The donee may also be liable for Municipal Capital Gains Tax (IIVTNU).
For gifting real estate, a public deed before a notary is mandatory for its validity. For other assets (such as a gift of money or shares), it is not strictly mandatory for the validity of the gift between parties, but it is highly recommended to provide public faith of the date, amount, and conditions of the gift. This greatly facilitates the settlement of Model 651 and avoids future problems with the Tax Administration or between parties.
Properly managing an inter vivos gift and assessing its tax impact using Model 651 can be complex. At GESTISYD, we offer:
We analyze your specific case, the applicable AC, and advise you on the best way and time to make the gift, minimizing the impact of Gift Tax.
We calculate the tax by applying all relevant reductions and tax benefits for gifts and prepare and file Model 651 with the competent Administration.
We inform you about all tax implications (donor's IRPF for capital gains and Municipal Capital Gains Tax payable by the donee for real estate) and coordinate with the notary if necessary for formalization.
We manage gifts with international elements, such as when the donor or donee is a non-resident in Spain, or when assets located abroad are gifted to a Spanish resident.
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