7. Temporary or life annuities

Regulations: Art. 17.Two Wealth Tax Law

We must distinguish:

• In general , the valuation of temporary or life annuities constituted as a consequence of the delivery of capital, whether in money, movable or immovable property, whose ownership corresponds to the declarant must be carried out by the result of capitalizing the annuity at the legal interest rate of the money in force on the date of accrual of this Tax (December 31) and taking from the resulting capital that part that, according to the established rules to value the usufructs, corresponds to the age of the annuitant, if the income is for life, or to the duration of the income, if it is temporary.

  The rules for valuing usufructs can be consulted in the section " Real rights of use and enjoyment (excluding those that, where appropriate, fall on the habitual residence of the taxable person)", which It is discussed in Chapter 3 of this manual.

  For the year 2022, the legal interest rate on money has been set at 3 percent. 

  When the amount of income is not quantified in monetary units, the valuation will be obtained by capitalizing the amount of 8,106.28 euros, the amount of the public multiple-effect income indicator (IPREM) for the year 2022.

• As an exception , when temporary or life income is received from life insurance, these will be computed at the value established in the valuation rule provided for life insurance in the base taxable of the recipient. That is, they will be computed by their redemption value at the time of accrual of the Tax and, from July 11, 2021, in the cases in which the policyholder does not have the power to exercise the right of total redemption on the date of accrual of the Tax, for the value of the mathematical provision on the aforementioned date.