5. Economic rights

Regulations: Art. 4.Five Wealth Tax Law

The following instruments are considered exempt from economic rights:

• The consolidated rights of the participants and the economic rights of the beneficiaries in a pension plan.

• The economic content rights that correspond to premiums paid to insured pension plans defined in article 51.3 of the Personal Income Tax Law .

  According to the aforementioned article 51.3 of the Personal Income Tax Law , insured pension plans are legally defined as insurance contracts that must meet the following requirements:

  1. The taxpayer must be the policyholder, insured and beneficiary. However, in the event of death, the right to benefits may be generated under the terms provided for in the regulations governing pension plans and funds.

  2. The contingencies covered must be only those provided for in article 8.6 of the consolidated text of the Law on the Regulation of Pension Plans and Funds approved by Royal Legislative Decree 1/2002, of November 29 (retirement; total and permanent incapacity for work in the usual profession or absolute and permanent incapacity for any work, and severe disability; death of the participant or beneficiary and severe or great dependency of the participant), and must have retirement as its main coverage under the terms established in article 49.1 of the IRPF Regulations .

  3. This type of insurance must necessarily offer an interest rate guarantee and use actuarial techniques.

  4. The policy conditions will expressly and prominently state that this is an insured pension plan. The name Insured Pension Plan and its acronym are reserved for insurance contracts that meet the requirements set forth in this Law.

  5. Policyholders of insured pension plans may, by unilateral decision, transfer their mathematical provision to another insured pension plan of which they are policyholders, or to one or more pension plans of the individual or associated system of which they are participants. Once the contingency has been reached, mobilization will only be possible if the conditions of the plan allow it. The procedure for carrying out the mobilization of the mathematical provision is regulated in article 49.3 of the IRPF Regulations.

• The economic content rights that correspond to contributions made by the taxpayer to the corporate social security plans regulated in article 51.4 of the Personal Income Tax Law .

  In accordance with article 51.4 of the Personal Income Tax Law , corporate social security plans must, in any case, meet the following requirements:

  1. The principles of non-discrimination, capitalization, irrevocability of contributions and attribution of rights established in section 1 of article 5 of the Revised Text of the Law on the Regulation of Pension Plans and Funds, approved by Royal Legislative Decree 1/2002, of November 29, will apply to this type of insurance contract.

  2. The policy will establish the premiums that the policyholder must pay, which will be charged to the insured.

  3. The policy conditions must expressly and prominently state that it is a Corporate Social Security Plan, with this designation reserved for insurance contracts that meet the legally established requirements.

  4. The contingencies covered must be only those provided for in article 8.6 of the consolidated text of the Law on Regulation of Pension Plans and Funds (retirement; total and permanent incapacity for work in the usual profession or absolute and permanent incapacity for any work, and severe disability; death and severe or great dependency of the participant), the main coverage must be retirement in the terms established in article 49.1 of the IRPF Regulations .

  5. Company pension plans must offer an interest rate guarantee and use actuarial techniques.

• The rights of economic content derived from the premiums paid by the taxpayer to collective insurance contracts, other than company social security plans, which implement the pension commitments assumed by companies, in the terms provided for in the First Additional Provision of the consolidated text of the Law on Regulation of Pension Plans and Funds, and in its implementing regulations, as well as those derived from the premiums paid by employers to the aforementioned collective insurance contracts.

• The economic content rights that correspond to premiums paid to private insurance that covers dependency defined in article 51.5 of the IRPF Law .

  These are the premiums paid for private insurance that exclusively covers the risk of severe or high dependency in accordance with the provisions of the Law on the promotion of personal autonomy and care for people in situations of dependency.