8.4.5. Reductions for contributions to protected assets of people with disabilities

Law 41/2003, of November 18, on the patrimonial protection of people with disabilities, has established a specific regulation for the patrimony of people with disabilities, whose immediate objective is the creation of a patrimonial mass destined to satisfy the needs vitals of a person with a disability. The Law favors the constitution of this patrimony and the free contribution of assets and rights to it by establishing a series of tax measures both for the owner of the protected patrimony and for the contributors for the contributions they make.

Beneficiaries of Protected Heritage

1. The protected assets of people with disabilities will have as beneficiary, exclusively, the person in whose interest it is established, who will be its owner.

2. For the purposes of this law, only people with disabilities will be considered:

   • Those affected by a mental disability equal to or greater than 33 percent.

   • Those affected by a physical or sensory disability equal to or greater than 65 percent.

Contributions to protected assets of people with disabilities will give the right to reduce the tax base with the following conditions:

1. The tax base will be reduced by contributions made by people who have a direct or collateral family relationship with the person with a disability up to the third degree inclusive, as well as by the spouse of the person with a disability or by those who had him or her at their disposal. position under guardianship or foster care, with a maximum limit of 10,000 euros per year for each contributor and for the set of protected assets to which they make contributions.

2. The total of the reductions made by all the people who make contributions in favor of the same protected assets may not exceed 24,250 euros per year. When several contributions are made in favor of the same protected assets, the reductions corresponding to said contributions must be reduced proportionally.

3. The positive amount of the taxpayer's general tax base once the appropriate reductions have been made.

Important : In no case will contributions made by the taxpayer with a disability who own the protected assets be entitled to a reduction.

Non-monetary contributions

When the contributions are non-monetary, the amount of the contribution will be taken as the amount resulting from the provisions of article 18 of Law 49/2002, of December 23, on the tax regime of non-profit entities and tax incentives for patronage.

Contributions of elements related to the activity carried out by taxpayers for the Income Tax of Physical Persons who obtain income from economic activities will not generate the right to reduction.

Excess contributions made and not reduced

1. Contributions that exceed the limits provided for in the previous section will give the right to reduce the tax base of the following four tax periods, until the maximum reduction amounts are exhausted in each of them, if applicable.

2. Contributions that cannot be reduced due to insufficient tax base may be reduced in the following four tax periods.

3. When reductions in the tax base for contributions made in the year with reductions from previous years pending to be applied occur in the same tax period, the reductions from previous years will be applied first, until the maximum reduction amounts are exhausted.

Disposition of assets or rights contributed to the protected heritage 

The disposition in the tax period in which the contribution is made or in the following four of any asset or right contributed to the protected assets of the person with a disability will determine the following tax obligations:

a) If the taxpayer was a taxpayer of the Personal Income Tax, he must replace the reductions in the tax base unduly made by submitting the appropriate complementary self-assessment including the applicable late payment interest, within the period established. mediate between the date on which the disposition occurs and the end of the regulatory declaration period corresponding to the tax period in which said disposition is made.

b) The owner of the protected assets who received the contribution must integrate into the tax base the part of the contribution received that had ceased to be integrated in the tax period in which they received the contribution as a consequence of the application of the provisions of letter w) of article 7 of the law, by submitting the appropriate complementary self-assessment plus the applicable late payment interest, in the period between the date on which the disposition occurs and the end of the regulatory declaration period corresponding to the tax period in that said provision is made.

In cases in which the contribution had been made to the protected assets of the relatives, spouses or dependents of the workers under guardianship or foster care, referred to in section 1 of this article, by a taxpayer of the Tax on Companies, the obligation described in the previous paragraph must be fulfilled by said worker.

The expenditure of money and the consumption of fungible movable property integrated into the protected assets will not be considered as acts of advance disposition, when they are made to meet the vital needs of the beneficiary.

Now, for such a conclusion to be possible, given that the tax benefits are linked to the effective constitution of an estate, the latter must be established, which implies that, except in exceptional circumstances that the person with a disability may specifically be going through, , the expenditure of money or fungible assets before the passage of four years from their contribution should not prevent the constitution and maintenance during the time of the aforementioned protected assets.

For the purposes provided for in this section, in the case of homogeneous assets or rights, it will be understood that those provided in the first place were disposed of.

In the event of the death of the owner of the protected assets, the contributor or the workers referred to in section 2 of article 43 of the consolidated text of the Corporate Tax Law, the provisions of letters a) and b) will not apply. of this section.

Completion

A data capture window will open in which you must indicate the following data: 

• NIF of the disabled owner of the protected assets to which the contributions have been made.

• Excesses pending reduction from the years 2016 to 2019.

  Taxpayers who have requested in said declarations to be able to reduce the excess in the following four years, will record in this box the amount that, pending application for this concept, should be applied in the declaration for the 2020 financial year.

• Contributions made in 2020 to the protected assets of the person with disabilities.

• Set of contributions, and excesses pending reduction, of all contributors to the same protected assets, with the right to be reduced in 2020, when they exceed 24,250 euros per year. 

• The program will transfer the contributions and contributions not applied to the corresponding section of Annex C.3

• To correctly complete this last section, you must take into account the following examples:

  1. Two taxpayers make contributions to their son's protected assets, for 15,000 each. Box should not be completed because the total amount entitled to be reduced in the year, 20,000 euros (10,000 euros per taxpayer) is less than 24,520 euros.

  2. Three taxpayers make contributions to the protected assets of a family member. Each of them contributes 15,000 euros. Yes, this box must be completed because the total amount entitled to be reduced, 30,000 euros (10,000 euros per taxpayer) is greater than 24,520 euros. The amount of 30,000 euros must be put in the box.