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Form 100. Personal Income Tax Declaration 2018

8.2.2.2. Transitional regime for profits derived from unaffected elements acquired before 12-31-94

  1. Profits generated until January 19, 2006:

    The reducing coefficients established in Law 18/1991 will apply to capital gains derived from the transfer of assets not used in economic activities , acquired before December 31, 1994. of June 6, of the Personal Income Tax, provided that the value of all the transfers made from January 1, 2016 with the right to apply the percentages does not exceed the amount of 400,000 euros.

    For these purposes, assets not assigned to economic activities will be considered those in which the disengagement of these activities has occurred more than three years prior to the date of transmission.

  2. Earnings generated after January 19, 2006:

    The part of the capital gain generated prior to January 20, 2006 will be distinguished from that generated after this date. For these purposes, the part of the capital gain generated prior to January 20, 2006 will be determined by the part of the gain that proportionally corresponds to the number of days elapsed between the acquisition date and January 19, 2006, both inclusive. , with respect to the total number of days that the element would have remained in the taxpayer's assets.

    The part of the profit generated prior to January 20, 2006 will be reduced by applying the reducing coefficients established in the previous regulations. The part of the profit generated after January 20, 2006 will not be subject to reduction.

    If during the financial year transfers have been made to which the ninth transitional provision of the Personal Income Tax Law is applicable, the additional data requested in section G2 on page 9 of the declaration must be completed, indicating the transfer value of all the assets. to whose capital gain this regime would have been applicable, transmitted from January 1, 2015 until the date of transmission of the capital element (not including the value of the latter).

SPECIAL REGIME: SECURITIES ADMITTED TO TRADING (Directive 2004/39/EC) AND IIC SHARES OR PARTICIPATIONS ACQUIRED BEFORE 12-31-94

The capital gain obtained will be reduced in one of the following two ways:

  1. If the transfer value is equal to or greater than that corresponding to Wealth Tax purposes for the year 2005.

    The part of the capital gain generated prior to January 20, 2006 will be reduced by applying the reducing coefficients. For these purposes, the transfer value will be taken to be that which corresponds to the securities, shares or participations for the purposes of the Wealth Tax for the year 2005.

  2. If the transfer value is lower than that corresponding to Wealth Tax purposes for 2005.

    In this case, the entire capital gain generated will be reduced by applying the reducing coefficients.

EQUITY GAINS DERIVED FROM ITEMS ACQUIRED BEFORE 12-31-94 (DT 9 Law)

The reducing coefficients established in the previous tax regulations will apply to capital gains derived from the transfer of assets not used in economic activities , acquired before December 31, 1994. . (D.T. 8 ap. 2, rules 2 and 4 Law 18/91) provided that the value of all the transfers made from January 1, 2015 with the right to apply the percentages does not exceed the amount of 400,000 euros.

Once the part of the capital gain generated prior to January 20, 2006 has been determined, its amount will be reduced, if applicable, as follows:

  1. The period of permanence in the taxpayer's assets prior to December 31, 1996 of the asset element will be calculated. For these purposes, the number of years, rounded by excess, between the date of acquisition and December 31, 1996, will be taken as the period of permanence in the taxpayer's assets. According to this rule, one year and one day will constitute two years; two years and one day will constitute three years, and so on.

  2. The transfer value of all the assets to whose capital gains this regime would have been applicable, transmitted from January 1, 2015 to the date of transmission of the assets (not including the value of the latter), will be previously calculated.

    If this value is greater than 400,000 euros, no reduction will be made in the gain derived from the transfer of the property, even if there is a reduction to the part of the capital gain generated prior to January 20, 2006.

  3. If the transfer value referred to in the previous section is less than 400,000 euros, said value and the transfer value of the asset element will be added, differentiating the following situations depending on the result:

    1. That the sum is less than 400,000 euros

      In this case, the part of the capital gain generated prior to January 20, 2006 will be reduced by the amount resulting from applying the percentages indicated in number 4 below, for each year of permanence in the taxpayer's assets since its acquisition until December 31, 1996 that exceeds two.

    2. That the sum is greater than 400,000 euros

      In this case, the reduction will be made to the part of the capital gain generated prior to January 20, 2006 that proportionally corresponds to the part of the transfer value of the capital element that, added to the amount of point 2 above, does not exceed 400,000 euros.

The limit of 400,000 euros is individual. Therefore, it is computed for each taxpayer for the part of the transmission value that corresponds to them of the elements transmitted as of January 1, 2015, depending on whether the ownership of the element is private or joint.

To determine whether or not 400,000 euros are reached, the transfer values corresponding to the capital gains generated by the transmission of the following assets not affected by economic activities will not be taken into consideration:

  1. The transmission values corresponding to acquisitions made after December 30, 1994, as the abatement coefficients are not applicable.

  2. The transfer values corresponding to transfers that have caused a capital gain not subject to tax by virtue of the provisions of article 33 of the Personal Income Tax Law or that are exempt from it or in the case of partial exemption due to reinvestment, will only be excluded the transfer value that was subject to reinvestment.

  3. The transfer values corresponding to transfers of shares or participations listed on official markets acquired prior to December 31, 1994 when their acquisition value is higher than the value for the purposes of the 2005 Wealth Tax, given that in that case they are not abatement coefficients would apply.

For these purposes, assets not assigned to economic activities will be considered those in which the disengagement of these activities has occurred more than three years prior to the date of transmission.

The part of the profit that has been generated prior to January 20, 2006 must be distinguished from that generated after this date.

  1. Profit generated until January 19, 2006.

    The application of the reducing coefficients is carried out in the following way:

    1. The profit or loss is determined for each element in accordance with the rules that are applicable in each case.

    2. If the result is a capital loss, it will not be subject to reduction.

    3. In the case of capital gains, the amount will be reduced as follows:

      1. The period of permanence in the assets of the taxable person will be taken as the number of years between the date of acquisition of the element and December 31, 1996, rounded up.

        In the case of subscription rights, the permanence period will be taken to correspond to the securities from which they come.

        If improvements have been made to the assets transferred, the period of permanence of these in the assets of the taxable person will be taken as the number of years between the date on which they were made and December 31, 1996, rounded by excess. .

      2. If the assets transferred were real estate, rights over them or securities of the entities included in article 108 of Law 24/1988, of July 28, on the Securities Market, with the exception of shares or participations representing the capital social or assets of the Real Estate Investment Companies or Funds, the capital gain will be reduced by 11.11 percent for each year of permanence that exceeds two.

        Capital gains derived from these elements will not be subject to tax when, as of December 31, 1996, they had a retention period of more than ten years (acquired before 12-31-86).

      3. If the assets transferred were shares admitted to trading on any of the official secondary securities markets defined in Directive 2004/39/EC of the European Parliament and of the Council of April 21, 2004 on markets in financial instruments, and representative of the participation in own funds of companies or entities, with the exception of shares representing the capital stock of Real Estate and Personal Investment Companies, the capital gain will be reduced by 25 percent for each year of permanence that exceeds two.

        Capital gains derived from these elements will not be subject to tax when, as of December 31, 1996, they had a retention period of more than five years (acquired before 12-31-91).

      4. The remaining capital gains will be reduced by 14.28 percent for each year of stay that exceeds two.

        Capital gains derived from these elements will not be subject to tax when, as of December 31, 1996, they had a retention period of more than eight years (acquired before 12-31-88).

    4. If improvements have been made in the transferred assets, the part of the disposal value that corresponds to each component thereof will be distinguished for the purposes of applying the provisions of the previous rules.
  2. Profit generated as of January 20, 2006.

    The profit generated after January 20, 2006 will not be subject to reduction.